Beijing-headquartered ByteDance has been planning to relocate the e-commerce unit of its short video app Douyin to Shanghai, 36Kr reported on Friday, citing sources from inside the company.

Shanghai’s preferential tax policies, as well as the firm’s desire to hire e-commerce talent based in Shanghai and Hangzhou, are behind the idea, the sources added. Hangzhou is home to e-commerce giant Alibaba, while its competitor Pinduoduo is located in Shanghai.

Employees unwilling to move to Shanghai can choose to shift to other positions inside the company, the sources said. The e-commerce team currently employs 2,500 workers, about 2,000 in operations and 500 in R&D.

ByteDance only set up its e-commerce department in June of last year. Nevertheless, its gross merchandise volume (GMV) reached RMB 500 billion (USD 77.5 billion), including transactions on its Douyin Xiaodian marketplace and deals directed to third-party e-commerce platforms such as JD.com and Taobao.

In January, Douyin unveiled a payment service as part of its effort to build a closed loop in the e-commerce business and promoted the service during the Spring Festival as sponsor of the hours-long gala held by state broadcaster CCTV.

For this year, Douyin has set a target of RMB 1 trillion (USD 150 billion) in GMV, not far below the RMB 1.27 trillion Pinduoduo reached in the twelve months ended June 30, 2020, according to LatePost.