Xiaomi to set up e-commerce business

Chinese smartphone maker Xiaomi is developing a full-fledged e-commerce business model for its phones and other devices, a top company executive said on Friday.

Xiaomi Indian head Manu Kumar Jain said the mobile phone maker is actively considering investing in a few startup technology companies to develop ecosystem.

Major portion of Xiaomi sales come through its channel partners such as Flipkart or Amazon or Snapdeal, beside its own portal — me.com.

"The investment will go into setting up our own e-commerce business (including setting up) warehouse and logistics. We also enable sales though me.com, which is our own e-commerce platform. We have not done any marketing for that (to promote the site)," Jain told reporters in a media interaction in Hyderabad.

He said the company is currently getting a few thousand orders a day, adding, they would also be investing in setting up a research and development centre in Bengaluru, a manufacturing facility and expanding exclusive sales and service network.

Jain, however, did not disclose the budget that will go into the expansion. When asked about the proposed manufacturing facility, he said they are in talks with various state governments for setting up the plant.

Jain said the company does not intend to manufacture the phones directly but through a contractual manufacturer.

To a poser, he said Xiaomi is currently talking to a few startups to invest in the company. "We are actively talking to few other tech companies. They are startups and none of them are like the new ones who are looking for angel's money. They are established. They have raised one or two rounds of funding and generating revenues," Jain explained.

According to Jain, Xiaomi has sold over a million smartphones in the first four months of its entry into the Indian market in July 2014, making it the fifth-largest player in the domestic market with a share of 4%.

The five-year-old company, which rolled out its first smartphone in August 2011, sold 61.1 million units globally last year, as against 18.7 million units in 2013, he claimed.