Alibaba, (the largest e-commerce company in the global market) has tied up with a Gurgaon-based firm, i.e. Allcargo Logistics’ overseas to ship LCL consignments to India at a cheaper rate. This move will help in faster deliveries for the Chinese retailer’s potential customers in India. LCL refers to cargo that does not fill a standard cargo container as well as it is grouped with other consignments to be delivered at the same destination.
According to Shashi Kiran Shetty, Allcargo’s founder and chairman, Alibaba has globally tied up with Antwerp-based subsidiary and Shanghai’s Amass Logistics.
This effort is gaining more traction at this time because the air freights are constantly rising, while the shipping is becoming more frequent. Thus, tying up with a logistics firm would mean the said company needs not to wait for the container to be full, in order to ship it.
As per Biswanath Bhattacharya, (partner at KPMG), due to the booming ecommerce sector, the supply chains are getting stretched and therefore all the companies are competing on timelines.
Jack Ma (Alibaba’s founder) told Narendra Modi that the company is very excited about the Digital India and Make in India programmes of the NDA government. This tie-up is also the first step in Allcargo Logistics’ planned rush into ecommerce.
According to retail advisory Technopak, the online retail industry, which was valued at $1 billion two years ago, is posed to reach $32 billion in 2020.
Transportation by sea is gaining momentum in the modern era, especially in cross-border sales. Last year, Allcargo bought Econocaribe Consolidators (US-based firm), through which it became the world’s largest player in LCL segment.
Shashi Kiran Shetty says that within a year, Allcargo is planning to get into the ecommerce sector and may look for major acquisitions. He further adds that, with enormous transportation capabilities, Allcargo can easily manage all the small and big trucks. Further, with a global network of freight forwarders, the company can easily transport materials at a faster rate.