Meat Industry Summit

April 8-11 Carlsbad, CA The Future of Retail and Meat Industry Implications Sponsored by:

Eric Pelletier Alibaba Group The Future of Retail and Meat Industry Implications

Eric Pelletier, Vice President, Alibaba Group Our Mission & Vision

OUR MISSION To make it easy to do business anywhere

OUR VISION To build the future infrastructure of commerce To be a company that lasts at least 102 years

FOUNDED IN HANGZHOU IN 1999 A GLOBAL TECHNOLOGY COMPANY

+10 million 70 million active packages merchants daily

636 million 90% US$ 768 active mobile GMV billion GMV consumers Alibaba Ecosystem

CORE COMMERCE DIGITAL MEDIA & ENTERTAINMENT

Tudou

Rural Taobao 699million NEW RETAIL Mobile LOCAL SERVICES Active Users

AutoNavi

PAYMENTS & FINANCIAL SERVICES

LOGISTICS

ADVERTISING & DATA MANAGEMENT PLATFORM

CLOUD COMPUTING 10th Annual Global Shopping Festival Alibaba: Gateway to the China Consumer… …and to the Indian and South East Asian Consumer US Brands Selling on Tmall Market Opportunity in China China Leads E-Commerce Worldwide

China Market Opportunity E-commerce Growth by Country 2018-2023

• Within 5 years, the Chinese middle class CHINA US UK JAPAN GERMANY is expected to reach 600 million (double the size of the entire U.S. population) 1,086M • There are 10 cities in US with population of 1m+; In China today there are 102. In 2023 10 years, estimated to be 220. 2018 • Of China’s 1.4 billion people, only half 735M

use the Internet and primarily via smart 636M phone—MASSIVE RUNWAY FOR GROWTH 504M • Ecommerce spend as a % of retail sale is 35% and rising

113M 103M 86.5M 95M 81M 70M Then in China Now in China Chinese consumers spend half of their income on clothes and food

衣 食 住 行 娱 康 奢 BEAUTY FOOD HOME TRAVEL LEISURE EDUCATION LUXURY

Source: Goldman Sachs 2016 Chinese Consumers Consume Differently

Some consumers prefer Higher consumption of meat, Demand for high imported fish, milk and fruits quality food is increasing food due to safety concerns

Source: Goldman Sachs 2016 The Five Drivers of Changing Food Consumption

1. Quality and safety

2. Advances in supply chain

3. Rural migration and urbanisation

4. Taste preferences of younger consumers

5. Increasing demand for premium food New Retail: Reshaping the Future of Retail A New Retail Experience: Hema Alibaba Sales Channels for Fresh, Frozen, and Packaged Food

ONLINE OFFLINE Selling to China

Direct Sourcing

Sell to Alibaba

Direct Retail to Consumer

Sell through your own store Direct Sourcing: Alibaba Win-Chain Wholesale

Win-Chain Online Market Places Purchasing Entity

1 Bulk Volume

Limited selection Business Entry 2 Offline Market Places

of products

Sell Distribute 3 Direct purchasing relationship preferred Growing Opportunity for US Meat in China

➢ Since 2000, China’s imports of beef have increased at nearly 28% annually ➢ Ongoing regulatory discussions to open the China market to US firms ➢ The Chinese middle class expected to grow to more than 100 million households by 2021 ➢ Per capita disposable income of urban consumers will double between 2010 and 2020, from about $4,000 to about $8,000 ➢ Other countries are already taking advantage ➢ Need to proceed strategically to take advantage of growing market Contact Information

Simon Shin [email protected] 971-777-3154 THANK YOU