Alibaba Group and its financing partners plan to invest 30 billion yuan ($4.5 billion USD) to build warehouses across China. The reason? Alibaba wants to meet a 10-year goal of delivering any online order in China within eight hours.
It’s an ambitious goal. The warehouses will occupy 3 million square meters (560 American football fields) and will be built in key areas near Beijing, Shanghai and Guangzhou, Alibaba said in a statement today.
“There are bottlenecks because e-commerce is growing so fast and exceeds the ability of local logistics companies,” Chief Strategy Officer Zeng Ming told reporters in Beijing today.
To provide exception online shopping experience, an E-commerce site needs to provide great online user interface and speedy delivery. Alibaba plans to work on delivery speed which will directly boost its online retail sales. It’s as good as buying and receiving a product on the same day. The experience is almost like buying directly from the brick-and-mortar retail stores.
Alibaba Group’s Taobao.com, owns more than 80 percent of the entire Chinese e-commerce market share in 2009. Daily orders are also expected to increase by 150 percent to 20 million next year, compared to 8 million at present, Bloomberg reported. Alibaba.com is used by giant corporations like Walmart and Proctor & Gamble to find suppliers.
Jack Ma, Chairman of Alibaba Group said that Alibaba might surpass Walmart in sales in less than 10 years. Judging by the ambitious logistic operations and the ever growing online community in China, Ma’s vision could be a reality within the next decade.
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