Subscribe / Unsubscribe Enewsletters | Login | Register

Pencil Banner

China's e-commerce binge tests logistics, rakes in sales

Michael Kan | Nov. 11, 2014
Masses of Chinese will be buying online goods during the country's version of Cyber Monday.

"That's our biggest day. A big test to our capacity," he said, while standing outside one of the company's shipping centers in Shanghai. Everyday, the facility processes 800,000 packages, but during the holiday, the figure is expected to reach 2 million, the maximum capacity for the center.

Xiang is hopeful that packages will arrive in a timely manner. Following last year's sale, packages shipped 1,400 miles from Guangzhou to Beijing took about three days, he said.

But others expect a longer wait. Brian Lee is the CEO of handbag retailer Sino Supreme, which has a major virtual storefront on Alibaba's Tmall site and sells through other Chinese e-commerce sites. During Tuesday's sales event, he projects his company will sell 27,000 handbags, a surge from the 200 they typically sell in a day.

The massive sales volume, however, means the company and its shipping partners will have their hands full processing orders. In the past, packages sent out to customers have taken seven to 10 days to arrive in some cases, a major delay from the two days it normally takes, Lee said.

"Customers do understand that you are going through hell, so they kind of have a lower expectation," he added.

Despite the logistical hurdles, the Singles' Day sales festival is a huge money maker for the company, generating about 15 to 20 percent of all the company's online sales for the year. To meet demand, Sino Supreme has stocked up on about 50,000 handbags, Lee said.

Participating merchants through Alibaba's Tmall site are offering discounts of up to 50 percent on their goods. Some merchants such as Android smartphone maker Xiaomi quickly sold out on certain deals within 15 minutes of the start of the sales event.

This year's festival also marks the first time Alibaba has sought to globalize the annual event, offering discounts through its English-language AliExpress site. After the first hour, the U.S. ranked as the festival's fourth-largest market, behind China, Hong Kong and Taiwan.

 

Previous Page  1  2 

Sign up for Computerworld eNewsletters.