Dong Wenhong: New Logistics Model Key to the Growth of Emerging Retail Era

December 2, 2016浙江省
By Chen YanxvEditor: Hewater Liu
Dong Wenhong: New Logistics Model Key to the Growth of Emerging Retail Era

Dong Wenhong gives a speech at the 3rd World Internet Conference held in Wuzhen, east China's Zhejiang Province. [China Women's News]


The traditional logistics industry in China has been faced with a shortage of human resources, a lack of unified standards and the underdeveloped degree of information utilization, to which the emergence of intelligent logistics with an emphasis upon the internet, cloud computing and big data is a solution, an industry expert said at recent gathering.

CEO of Cainiao Network Technology Co., Ltd. Dong Wenhong, who is also one of partners of the Alibaba Group, made the remarks during an interview at the 3rd World Internet Conference held on November 16-18 in Wuzhen, east China's Zhejiang Province. The rise of the internet, cloud computing and big data will make a fundamental transformation to the operation of traditional industries, including the logistics industry, Dong added.

Reporter: How do you comment on the changes brought about by cloud computing and big data to the domestic express delivery industry?

Dong: The Chinese express delivery industry is the most efficient in terms of price versus performance ratio across the world. The industry has been building ties with big data and cloud computing after it bid farewell to the extensive growth pattern of years ago. Its growth rate has reached more than 40 percent for six consecutive years. Without the support of new technology, the industry cannot cope with the task of handling billions of postal packages annually.

Right now, the express delivery industry has increasingly emphasized the competence and quality of its service and stressed the sharing of industry data amongst industry practitioners. As a consequence, all practitioners have developed closer ties to the industry's growth. For instance, Cainiao championed setting up an alliance with the participation of key domestic delivery enterprises this March, with the target of providing domestic customers with a qualified delivery service. This development model with an emphasis upon technology and service will become stronger and stronger, and the trend of openness in this industry is expected to be persistent in the following years.

Reporter: What do you think of the ties between the internet and real economy?

Dong: The internet and real economy have become closely interconnected and there is no clear dividing line between them. Some people often mistake the internet for online business and the real economy for offline business. In fact, the internet is never an opposed model to the real economy.

Chinese tycoon and Alibaba founder Jack Ma recently proposed the concept of "Five News" (new retail, new manufacture, new finance, new technology and new energy), according to which logistics industry is expected to play an important role in the promotion of retail and manufacturing businesses in terms of both online and offline models. Cainiao has aimed to cultivate a new kind of logistics industry, which operates under the motivation of big data and socialized coordination and is beneficial to the further development of new retail business.

Reporter: SF Express and the other four big private practitioners have rushed to be listed on the market. How do you feel about this trend?

Dong: These five big private express delivery firms have accumulated giant businesses for years. The intention to be listed on the market has shown their pursuit of higher achievements in the future. Cainiao is delighted to see them proactively embracing change and the future. However, they should be continually aware of the importance of better service and the sharing as well as opening up of big data, when they are listed on the market.

Reporter: Should express delivery companies pay more attention to air transportation, especially when they compete against each other in providing fast and better service?

Dong: Air transportation is a useful channel to speed up the delivery of postal packages. Nevertheless, a comprehensive promotion in the delivery service of the express delivery industry has demanded the optimization of all procedures, which can only be achieved with the utilization of big data, cloud computing and artificial intelligence as well as closer coordination of social resources.

Reporter: Both the domestic express delivery industry and e-commerce have experienced fast growth in recent years. What do you think of their ties?

Dong: The new model of the express delivery industry will become a pillar in the era of the emerging retail business. We are considering how to further lower the total expenditure of social logistics and speed up the sale of commodities for businesses, thus we cannot simply divide our business operation into online and offline. This model has shown its force in the successful assistance of an e-commerce agent in the sale of its goods both online and offline during this year 's shopping spree in November.

Reporter: Can you tell me which things you have done this year in relation to the internet?

Dong: We are indefinitely working on an "Environmental Friendly Express Delivery Initiative." We have worked with manufacturing firms and experts in the research and production of biologically disposable package bags. So far, the initiative has been implemented in ten cities. We have won the understanding and support of government departments, delivery firms, e-commerce agents and customers in the initiative's implementation. We hope government departments will introduce more regulations to further their actions on this point.

(Source: China Women's News/Translated and edited by Women of China)

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