Home Facts world

Taobao mall vendors end protest as ministry steps in

Taobao mall vendors end protest as ministry steps in

Write: Merten [2011-10-17]

Taobao mall vendors end protest as ministry steps in

China's largest business-to-consumer online marketplace, Taobao Mall Co, last Tuesday announced significant increases in the commission rates and premium fees it charges to all online shops, which outraged small dealers. [File photo]

Small vendors at Taobao Mall Sunday said they will stop the protest against service fee hikes after China's Ministry of Commerce stepped in and ordered Taobao.com to respond to vendors' demands.

"We will suspend some of our activities today as government authorities have stepped in," said the protestors in an online statement, "we believe the government will give us a satisfactory result on the matter."

The Ministry of Commerce expressed its concerns over the protest and vowed to stabilize prices and support small businesses, according to a statement posted on the ministry's website on Saturday. The ministry also asked Taobao Mall to take active measures to address reasonable demands of small- and medium-sized vendors on its platform.

Taobao mall raised its annual membership fee last week from 6,000 yuan to between 30,000 yuan and 60,000 yuan, depending on business type and scale. The online retailer also hiked vendors' cash deposit from the original 10,000 yuan to a maximum of 150,000 yuan, also depending on the category of goods sold. The new rule is believed to be in favor of large vendors and making it more difficult for smaller ones to survive.

Angry small vendors, more than 1,000 of them, started protesting against the new rule on last Tuesday night by attacking large vendors at Taobao Mall. The protesters deliberately snapped up goods at large vendors' online shops and then ask for refunds or filing complaints.

Taobao Mall, founded in April 2008, hosts more than 40 million registered users, 50,000 registered businesses and 70,000 brands.

According to Analysys International, Taobao Mall accounts for 33 percent of the B2C online retail market in China, followed by 360buy.com and Amazon.cn.