Last year at this time, Supply Chain Matters featured a commentary focused on China’s online fulfillment provider Alibaba. Noted was that we can sometimes get enamored with names such as Amazon and Wal-Mart but Alibaba is indeed an evolving player to reckon with in this era of online commerce and hanging retail supply chain customer fulfillment.
That point was again driven home this week with reports of probably one of the largest online fulfillment events, ever, an event that made a significant statement relative to the processing of a single day’s volumes and on promoting largescale consumer interest in an online shopping event.
China’s Singles Day is somewhat equivalent to Black Friday or Cyber Monday in terms of an online shopping event. This event was conceived by students in the 1990’s as a mock celebration for people not in relationships, with a desire to give something to oneself. It traditionally occurs on the 11th day of the 11th month or Double Eleven, since when written numerically, November 11th is represents “bare branches”, a Chinese expression for bachelors and singles. In 2009, Alibaba orchestrated an online shopping event promotion to rival that of Western nations. The event is now replete with high anticipation including a four-hour variety television shopping focused extravaganza complete with Hollywood celebrities and other guests.
According to Alibaba, this year’s Singles Day online event recorded a record 91.2 billion yuan ($14.3 billion) in one-day gross sales. Volume was reported as surpassing last year’s $9.3 billion in sales after 12 hours. For the sake of comparison, last year’s online Black Friday and Cyber Monday volumes do not come close to that of this year’s Singles Day.
A report from BBC News highlights data indicating that the event now represents 80 percent of China’s total online shopping with an estimated 120,000 orders processed each minute. Nearly 73 percent of online purchases in the first hour had reportedly originated by mobile phone. Alibaba further indicated that this year there would be 40,000 merchants and 30,000 brands from 25 countries offering merchandise across its various online platforms.
Of significance from a supply chain logistics and fulfillment perspective is that Alibaba owns its own parcel delivery logistics entity, Cainiao, along with close relationships with other logistics providers to insure that packages are delivered to expectations amid a number of residential delivery challenges across China’s high density urban and rural landscapes. The online firm estimates that 1.7 million delivery persons and over 400,000 vehicles will be deployed to deliver this week’s volume of packages. In a September commentary, we called attention to Cainiao’s efforts to forge shipping relationships with other global parcel delivery entities including the United States Postal Service.
Make no mistake, when it comes to sheer volume and scale of B2C/B2B online commerce, Alibaba is the provider to watch. This week’s Singles Day milestone provides yet more evidence of such scale and inherent online retail customer fulfillment capability.