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Alibaba invests huge sums in Cainiao - JD.com is ready to conquer the market

According to a Telworld report, the Alibaba Group has announced it's going to invest 5.3 billion yuan in the Cainiao Network. The percentage of Cainiao shares belonging to Alibaba will change from 47% to 51%, which means Alibaba will have a controlling interest. It is planning to raise 100 billion yuan in five years. This money will go in to data technology optimization, improvements in logistics efficiency and a supply chain optimization. 

The so-called Singles Day, November 11th sales day, is right around the corner and Liu Qiangdong is promising that in five years JD.com will catch up and overtake Alibaba. Alibaba is investing huge sums of money in a global logistics network, but JD.com is very determined to win the race.

Customer demands for delivery are becoming ever more stringent. An automatisation of the logistic process would definitely be a great improvement. At this moment, Alibaba still has some issues with delivery and it's global logistics lag behind those of Amazon.

It is clear that by carrying out it's plan on logistics, Alibaba also intends to crush JD.com. However, unlike JD.com, Alibaba is not going to control the logistics process, it will just create a high-efficiency technical platform for Cainiao. If the plan "One-day domestic delivery, three-days global delivery" works, Cainiao will strengthen Alibaba greatly. A new challenge that might appear in a future is to keep a balance between the two high-load platforms.

Source: Telworld

Publication date: 10/9/2017


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