Cainiao Sees 26% YoY Growth in Q2 FY23

Cainiao Sees 26% YoY Growth in Q2 FY23

Cainiao Network, the logistics arm of Alibaba Group Holding Limited, has announced its financial results for the quarter ended September 30, 2022.

In the quarter ended September 30, 2022, revenue from Cainiao, before inter-segment elimination, grew 26% year-over-year to RMB 18,282 million (US$ 2,570 million), of which 73% was generated from external customers.

Referencing Cainiao CEO Wan Lin’s speech at the company’s Open Week 2022 in July, he emphasised Cainiao’s continued commitment towards the development of a strong and sustainable logistics organisation, with a focus on globalization and long-termism.

Operationalizing resources to broaden doorstep delivery network With a focus on improving customer experience, Cainiao has strengthened its last mile logistics capabilities with the expansion of Cainiao Post network to encompass over 170,000 stations, more than 20% yearover-year growth. Cainiao Post stations located in urban residential communities grew to over 116,000, of which over 80,000 offer doorstep parcel delivery services.

Cainiao has reinforced its logistics and supply chain management capabilities to provide value-added services in B2B and B2C areas such as furniture assembly, bulky goods delivery, cold chain management, FMCG, and beauty products.

This quarter, Cainiao has partnered with Shiseido’s subsidiary, Aupres, to officially launch a central distribution center in North China. The partnership encompasses the management of warehouse, central distribution center, as well as end-to-end logistics and supply chain management to support their physical stores nationwide and eCommerce channels. This move has helped Aupres to consolidate and streamline its B2B and B2C businesses in China.

To address the pain point of furniture assembly, Cainiao has established and strengthened its own team to provide same day delivery and assembly services spanning 300 Chinese cities and suburbs. To further safeguard service stability for merchants and customers, Cainiao has set up its own warehouses and consolidation/distribution centres in key manufacturing hubs, along with regular designated delivery slots.

Reinforcing global logistics network to safeguard trade flows To reinforce its global logistics network, Cainiao has expanded the number of overseas distribution centres to 12, with a focus on last mile deliveries and smart lockers to optimize and localize its services in destination countries.

For example, by leveraging its warehouses in China’s Weihai and Yantai, and distribution center in South Korea, it is able to achieve cross-border deliveries between China and South Korea in as fast as 37 hours.

Its investments in in-market logistics network development in countries such as Spain and France also allowed Chinese merchants to pre-stock their goods locally to accomplish deliveries to local consumers in as fast as two days, with some key cities achieving same day deliveries.

This quarter, Cainiao has also accelerated globalization initiatives, with the roll out of self-operated smart logistics facilities in 16 countries and regions.

On the ESG front, Cainiao has continued its efforts in the areas of green logistics and emergency logistics.

Internet of Things (IoT) technology has been implemented in over 1,000 Cainiao Post stations to support recycling initiatives, along with the introduction of a carbon billing system. Cainiao has also partnered with 28 organizations on emergency logistics and rolled out digitalized transportation system to improve overall efficiency during emergencies.

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