Proving the Business Case for the Internet of Things

Cainiao opens three cold chain centres in China that provide real-time data for food distributors

Steve Rogerson
June 30, 2015
 
Cainiao, the logistics affiliate of Alibaba Group, has established three fresh food distribution centres in three Chinese cities – Beijing, Shanghai and Guangzhou. The centres are expected to support cold chain delivery of fresh food purchased on Taobao Marketplace and Tmall.com to the doorsteps of Chinese consumers within 24 hours.
 
They operate a logistics information platform that provides real-time access to information for both buyers and sellers, as well as information that allows delivery service providers to improve the efficiency and effectiveness of their services.
 
The company's cold chain delivery service reaches 18 Chinese cities, including Beijing, Shanghai, Suzhou, Nanjing, Hangzhou and Shenzhen. By the end of 2015, it plans to expand this service to 50 major Chinese cities. To fulfil the varying needs of customers, the three new distribution centres also support on-demand delivery services, including delivery on specific dates and times, and night delivery.
 
"The cold supply chain in China normally serves the business-to-business market, however, with the rising popularity of consumer e-commerce, we believe efficient cold chain delivery in the business-to-consumer segment is sorely needed as we aim to give our consumers the freshest possible result," said Maggie Chen, head of the fresh food delivery team of Cainiao, "The company will invest more and work closely with our partners to strengthen the cold chain network across China."
 
Driven by their growing disposable income and healthier eating habits, an increasing number of Chinese consumers are seeking out better quality, freshness and convenience when they shop for food. The demand for quality food has fuelled recent growth in online food retailing, which in turn is driving the development of cold chain logistics to serve China's online population of 618 million.
 
To meet the rising demand from Chinese consumers, Cainiao has joined hands with its partners to establish cold chain infrastructure and techniques to operate and manage refrigerated warehouses, equipment and packaging to ensure the quality of perishables, such as meat and produce, upon delivery.
 
According to Roland Berger Strategy Consultants, China's cold chain logistics industry is growing 25 per cent a year and will reach RMB470bn in scale by 2017. Cainiao, a consortium of logistics companies operating a network of warehouses and delivery services, is working with several partners to improve cold chain infrastructure, efficiency and service quality.
 
Cainiao was formerly known as China Smart Logistics.