Dive Brief:
- Alibaba.com plans to add origin countries beyond China to its recently launched Logistics Marketplace offering as it looks to gain momentum in a crowded market, Yikun Shao, the company's head of North America B2B supply chain, told Supply Chain Dive.
- The marketplace, first announced in April, aims to help U.S. small and medium-sized businesses more easily access logistics providers. Users can compare real-time quotes and book a variety of cross-border transportation services, including full container shipping, door-to-door express delivery and direct shipping from suppliers to Amazon fulfillment centers.
- The offering is currently supporting China-based shipments to 46 markets. Alibaba.com is working to include more origin countries and destinations since many of the available logistics providers have the capability to cover other trade lanes, Shao said in an interview.
Dive Insight:
The launch and planned expansion of Alibaba.com's Logistics Marketplace comes as the company — part of China-based tech giant Alibaba Group — has expanded its scope beyond connecting retailers, wholesalers and other buyers to suppliers.
Now, it's helping businesses find fulfillment and cross-border shipping services as well. Since Alibaba.com users are often small- and medium-sized enterprises, they need more help securing logistics services at the right price and service level, according to Shao.
"They don't have the time and the resources to deploy a traditional approach when it comes to logistics, contract negotiations and securing space at the best possible prices," Shao said.
These hurdles have led several companies to launch supply chain platforms and service offerings touted as one-stop shops for SMBs.
Last year, Amazon debuted an end-to-end set of supply chain services for its third-party sellers to use across all sales channels. That set includes Amazon Global Logistics, which handles cross-border transportation and aims to add more origin points beyond China.
Flexport also launched its own comprehensive supply chain tool to help companies move products from factories to customers.
The edge Alibaba.com's offering has versus other freight marketplaces is a variety of logistics providers and mechanisms to incentivize "the highest level of service," Shao said.
The marketplace uses a ratings system to help buyers choose a variety of pre-vetted service providers based on performance indicators like response time and on-time delivery rate, according to a news release. Alibaba.com monitors platform-level performance data tied to these providers to make sure they meet customer expectations.
"That's one of the most important areas that we really tackled and really focused on before we launched the product," Shao said.
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