China's Alibaba is Bullish on E-Commerce

August 19, 2013
Image representing Alibaba as depicted in Crun...
China’s Alibab is on a U.S. acquisition spress.

Chinese e-commerce giant Alibaba is on an investment spree. The latest is a $75 million minority investment in premium shipping site ShopRunner. Shoprunner offers services similar to those provided by Amazon Prime. The deal follows a similar investment in Fanatics, a US sports merchandise e-commerce company.

What does this mean for those of us in the shipping and and logistics field? The obvious message is that the Chinese and Alibaba, specifically, are clearly bullish on e-commerce. It is indeed the Chinese market that holds the key to extraordinary growth in retail. Anyone who is able to tap even a part of that market is laying claim to a golden goose.

Alibaba’s U.S. acquisitions are also indicative of its desire to learn some of the finer points of e-commerce as practiced in the U.S. as well as the importance it places on e-commerce in the run up to its expected IPO later this year or early next. E-commerce continues to grow at a rapid clip in the U.S., enjoying double digit growth as warehouse availability is at a premium.

This trend has been in evidence the last couple of years as Capacity LLC has worked a number of its retail clients to develop processes and systems that enable them to handle consumer orders directly. It has been an extraordinarily exciting time for us as we have increasingly served as the conduit between a number of consumer brands and their customers. From the vantage point of our warehouse floors, it’s a trend that we see increasing dramatically in the months and years ahead.

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