Packages shipped from China are about to get a boost from the U.S. Postal Service. An agreement between the Postal Service and Cainiao, Alibaba Group Holding Ltd.’s logistics service, means U.S. consumers could receive overseas packages from Alibaba’s global marketplace AliExpress faster.
Cainiao Vice President Wan Lin called the agreement on cross-border e-commerce “a key part of Alibaba’s globalization strategy and our vision to enable consumers around the world to enjoy the convenience and benefits of e-commerce.”
A memorandum of understanding signed Wednesday by the Postal Service and Cainiao aims to make shipping channels into the United States more efficient for Chinese merchants. The agreement also calls for the Postal Service, which has 600,000 employees, to help Cainiao, formerly known as China Smart Logistics, expand worldwide shipping capabilities, especially in South America, according to Alibaba Group.
“Alibaba is using AliExpress as the ‘tip of their sword’ to enter the U.S.,” says ChannelAdvisor Chairman Scot Wingo. “This deal with USPS lays the groundwork to extend Alibaba’s strong logistics and 3PL [third-party logistics] network into the U.S.” ChannelAdvisor provides technology for selling through such e-marketplaces as Amazon.com, ebay, Rakuten and Aliexpress.com.
The Postal Service gave no details about its role. It said in a statement, “It is hoped through this collaboration—which is designed to improve the customer end-to-end experience—American consumers who order goods from e-commerce sellers in China soon will receive faster package delivery.”
Wan said in a statement, “As cross-border e-commerce grows rapidly, it is critical that we evolve shipping services to the next level, with shorter delivery times and easier methods to track a shipment.”
In June, Cianiao president Judy Tong said the two-year-old company, of which Alibaba Group Holding owns 48%, plans to conduct an initial public offering to fund its rapid expansion. Cainiao is building delivery hubs near five of China’s largest cities, including one near Beijing that will span an area equivalent to 37 football fields. Cainiao intends to extend a network to reach the U.S., Russia, Brazil and Spain to complement existing bases in seven countries.
The global cross-border e-commerce market for business-to-consumer transactions is expected to hit $1 trillion in 2014, up from $230 billion in 2014, according to a report from consulting firm Accenture and AliResearch, Alibaba Group’s research arm. Alibaba also has been working with mail carriers in other nations, including Singapore Post and Spanish Post.
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