Cainiao enhances parcel processing capacity by 10 times
Cainiao Smart Logistics Network, the logistics arm of Alibaba Group Holding Limited, has announced the full implementation of Apollo system, a proprietary logistics technology across 11 Asian countries, enhancing the parcel processing capacity by 10 times during peak periods where hundreds of millions of parcels are processed. Customers in these countries will be able to receive parcels from China as soon as the same day when an order is placed.
Developed and implemented by Cainiao, the Apollo system was launched to establish a highly-efficient logistics network and operations standardization across different Alibaba Group’s businesses and its partners. Spanning 6 months, the Apollo team comprising 600 developers and engineers embarked on the digitalization initiative which leveraged big data and intelligent algorithms to optimize various objectives based on parcel location, destination, cost considerations and partner logistics efficiency. This algorithm can be constantly re-iterated and optimized based on changing business needs and environment.
It is now adopted by e-Commerce and logistics partners across 11 Asian countries, namely Indonesia, Malaysia, Singapore, Vietnam, Thailand, Philippines, Pakistan, Nepal, Myanmar, Bangladesh and Sri Lanka, with the estimated coverage of one billion users. The full implementation leads to 50% increase in delivery accuracy as well as 10% reduction in the average cost through its smart order splitting, route optimization and pricing technologies.
As one of the fastest growing e-Commerce markets in the world, Southeast Asia is projected to achieve a 23 per cent compound annual growth to reach US$53 billion in 2023. However, the inadequate local logistics infrastructure results in a long delivery time and high cost. Survey showed that 34% of consumers in Southeast Asia are unsatisfied with their current delivery services. As customer satisfaction is a key factor for customer retention, optimizing the delivery experience is crucial to improving customer lifetime value.
Weicai Chen, Project Manager of Apollo said: “Southeast Asia is a dynamic market which is home to a large number of e-commerce and logistics firms, but its overall logistics user experience needs improvements in order to remain competitive and efficient. We are committed to digitalizing the whole industry by upgrading its logistics technology and infrastructure with our local partners. With Apollo, we will be able to drive the integration of logistics capabilities with e-commerce strategy to cope with the e-commerce boom in the region.”
