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place model and the geographically dispersed buyers and sellers based in china.Five strategic pillars of Cainiao networkStrategy 1: The express delivery strategy – bringing an end to price wars among courier companies.Strategy 2: The warehouse and distribution strategy – uses hubs to decrease shipping rates and achieve next day delivery in 50 cities within the year.9
Strategy 3: The cross-border logistics strategy – Building a global network to achieve synchronization of international logistics information.Strategy 4: The rural area logistics strategy – reaching “a thousand counties and a hundred thousand villages” covering second tier logistics.Strategy 5: The pickup stations strategy – Tens of thousands of pickup stations all over the country to cover last-mile delivery4.Alibaba Worldwide:Alibaba International MarketIn 2017, international market only contributes small portion for Alibaba total revenue, which consist of two segment, International commerce retail (6%) and International commerce wholesale (4%) total of 10%. Income are still generating mainly from domestic sales, which is 67%. Currently, China facing economic slowdown, so company looking for market expansion oversea in years to come. In an interview, Jack Ma set goal to attain 50% of company’s revenue outside of China, and it seem like a very difficult goal to attain when look at it current situation and its big competitor like Amazon. International ExpansionAfter issuing initial public offering (IPO) in 2014, Alibaba seeking more opportunity in global market. Even though the international revenue is relatively small, but all of them shown significant increase. According to it company annual report, revenue from international commerce retail business in the end of 2016 was $353 million, the increase of 288% compare to it previous year, primarily due to the growth of Lazada and AliExpress. Revenue from international commerce wholesale business was $224 million, an increase of 9%, which due to the growth revenue of the import and export services from Alibaba.com.Alibaba try to laying the foundation for long-term growth. Their cross-border and international consumer business constantly shown rapid growth in every quarter. The business includes Tmall Global for cross-border imports, AliExpress for cross-border exports, and Lazada for the Southeast Asia market. Alibaba continue looking for revenue in oversea markets where they 10
believe they can bring a unique value to merchants and consumers. For example, Tmall Global provides global brands, retailers, small business and farmers from economies around the world access to over 440 million Chinese consumers on the platform. Moreover, the company continue to invest in the commerce infrastructure in emerging markets, such as Southeast Asia, to expand merchant and consumer opportunities and capture the long-term growth potential of cross-borderand local trade (Alibaba’s 2016 annual report).