Alibaba Intends To Reach Rural Populations Of China

Alibaba has planned to sell goods to the rural communities of China despite of challenged postal conditions. 

Alibaba has disclosed its plans to dominate the industry. The Chinese ecommerce company is hungry for the expansion and its reach to the Northern China’s underdeveloped parts. It is ready to do it though it would be difficult for it to deliver its goods to consumers there.

Part of Alibaba’s 2016 plan involves expanding its operations in the largest cities of the most populated country. This involves focus on electronic sales and online grocery in Beijing, a gateway for providing services to 400 million people in the underdeveloped northern regions, the Hangzhou based organization stated.

It is being packed as an “Alibaba everywhere” approach, and hinges on to make it comparatively convenient for people living in rural areas to purchase from the online trading company. Wall Street Journal reported that the sluggish growth of the organization in bigger cities of China has spurred it to enter untapped regions.

The problem is that getting “everywhere” is tough. The postal system of China could not be relied upon, as there are very few distribution centers and roads in rural areas are bad.

The Journal has reported that total electronic sales in the second largest economy would be reaching $356bn this year. In big cities, it means that a large number of packages would be delivered through couriers moving through streets on scooters.

Delivering to far-flung communities is a more different task. Journal has reported that Customers complaints about lost mail have made China strip over 100 delivery service providers – a challenge for the Southeast Asian country that is ranked as the 26^th on the planet by the World Bank as far as logistics infrastructure is concerned.

A factor responsible is less number of national retail chains in the country that provide services to customers when compared to the United States, where medium and big sized boxes are able to sprinkle generously across 50 different states.

The US is able to benefit from the roads established in 19^th century to run a strong postal system. Moody’s informed that due to the lack of development of the retail store networks in China, out of the cumulative, 11% take place across the internet versus 8% in the United States.

That would be increasing to just less than 16% later in 2016. That means the ecommerce organization would be able to reduce its workload by finding a method for reliably getting packed goods from online to offline.

CEO of Alibaba, Daniel Zhang, said, “We are going to consolidate and expand our current market, particularly by enhancing reputation, optimizing user experience and increasing our market share in first-tier cities.” The sharp focus in the major cities of the country follows the decision of Alibaba to establish its second head office in Beijing.