Kroger to sell groceries in China via Alibaba

Kroger, the largest US supermarket chain, will start to sell some of its products to Chinese shoppers through a website owned by internet giant Alibaba, the latest move by the supermarket chain to boost its digital business.

Cincinnati-based Kroger is working to catch up with Walmart and with Amazon.com, which bought grocer Whole Foods last year.

Kroger Co. said Tuesday that it will sell items from its store brand Simple Truth on Alibaba's Tmall site, including Simple Truth nuts and multivitamins. The online store will open Wednesday, Kroger said.

Many American companies sell their goods on Tmall as way to reach Chinese customers without having to open brick-and-mortar stores in the country. Costco, for example, sells Kirkland vitamins, nuts and other products on the site.

"E-commerce enables Kroger to quickly scale to reach new customers and markets where we don't operate physical stores, starting with China," Kroger Chief Digital Officer Yael Cosset said in a statement. "We anticipate Chinese consumers will love Our Brands — starting with Simple Truth products — just like our American customers do."

Cosset, who told The Wall Street Journal the company had looked at other companies before settling on Alibaba, did not disclosed the terms of the financial arrangement with the Chinese site.

"Growing into the Chinese market is a huge opportunity for Kroger and we are really excited," Cosset told the Journal.

A spokeswoman for Alibaba said the company was "pleased to work with Kroger" on bringing its natural and organic lines to Chinese consumers.

"Kroger is proud to continue to lead the way in making natural, organic and free-from products more mainstream and accessible," Cosset said. "Sharing Kroger's exclusive brands and status as a food authority the world over is exciting."

It will be the first time Kroger has introduced its private-label Our Brands and Simple Truth to international consumers.

Since being launched five years ago, Simple Truth has become the second-largest selling brand in Kroger's 2,800 US stores, topping $2 billion this year, Supermarket News reports.

The entry onto China is the fifth e-commerce move Kroger has made in the last three months in order to counter competition from Amazon's Whole Foods and others, the Journal reports.

Since May, Kroger has launched an online delivery service, upped its investment in a British online grocer and agreed to buy a meal-kit company.

"Kroger is the world's third-largest retailer by revenue, $122.7 billion in sales in 2017," Cosset told Supermarket News. "We are creating the grocery retail model of the future by focusing on digital and technology."

The partnership could also give Alibaba an edge in its rivalry with JD.com, which is partnered with Walmart.

Kroger Co. shares rose 2.4 percent Tuesday after the Wall Street Journal reported on the new venture.

The Associated Press contributed to this story.