Alibaba’s logistics arm Cainiao to speed up delivery times to meet boom in online shopping

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Cainiao Network Technology, the logistics unit of Chinese Internet giant Alibaba Group Holding, announced a three-year initiative to ramp up efficiency so it can deliver packages within 24 hours in China and 72 hours globally.

The affiliate of the country’s largest e-commerce player said the company will invest at least 1 billion yuan (RM605.2mil) in its logistic network to increase chartered flights, build out warehouse facilities and expand partnerships with customs authorities around the world.

“Logistics is no longer an afterthought. Today, logistics has become a game changer and key differentiator that sets one business apart from another,” Cainiao president Lin Wan said in a statement. “Our investment to establish a global smart logistics network, including international shipping routes and warehousing facilities, will provide businesses with greater operational efficiency, cost savings, transparency and accuracy in their supply chain management.”

To benefit its merchants running 100,000 online stores, Cainiao plans to quadruple its chartered flights to 1,260 from 260 over the next nine months while airfreight delivery time will drop to three to five days from the current seven to 10.

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In addition, Cainiao will double the floor space of its overseas warehouses over the next three years to 2 million square metres so that Chinese merchants can store their goods closer to customers, which will further speed up delivery times.

The company also said it will double down on its 72-hour delivery commitment for merchants using its warehouse network by optimising the logistics supply chain in over 500 counties and in 21 Chinese provinces.

E-commerce players across China have been expanding their infrastructure to meet the needs of millions of consumers who have embraced online shopping since the Covid-19 pandemic hit the country.

Cainiao’s move comes after JD.com, the second largest e-commerce company in China, expanded its logistics network and added three more of its highly automated Asia No 1 logistics parks last month to increase same or next day delivery service for lower-tier cities in the country.

Earlier this month, JD Logistics announced a fully-integrated smart logistics park in Tianjin, a city east of Beijing. The intelligent warehouse, which JD said was the first of its kind in Asia, is equipped with Internet of Things and artificial intelligence technology to enable optimised processing of millions of packages with low inventory turnover.

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Alibaba is the parent company of the South China Morning Post. – South China Morning Post

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