July 4, 2023: On Friday, the company said that Alibaba’s grocery department Freshippo grew its number of physical stores in China as the business prepares to spin off from its parent organization and go public.

Freshippo, known as Hema in China, plans to spread 12 stores across mainland China in influential cities such as Beijing, Shanghai, and Guangzhou.

Groceries have evolved into a battlefield for China’s two biggest e-commerce companies, Alibaba and JD.com.

Previous week, JD set up a new business unit to house its grocery business 7Fresh, and appointed a business veteran to lead the division.

Alibaba’s Freshippo tries to blend the company’s strength in e-commerce and logistics with the more traditional shopping adventure. Users can order online and get groceries provided, but can also head to the physical stores known for their fresh produce, such as lobsters.

The development arrived three months after Alibaba divided itself into six separate enterprise units to get the company back to growth. These units can increase outside capital and go public.

However, Freshippo is a separate, independent business under Alibaba, not one of the six enterprise groups. In the previous month, Alibaba greenlit an initial public offering for Freshippo but did not give a timeline.

Freshippo has over 300 stores across 27 cities in China.