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Cainiao expands China BtC cold chain

SHENZHEN: Cainiao, the logistics subsidiary of the Alibaba Group, is opening distribution centers in Beijing, Shanghai and Guangzhou this month to provide next day delivery of meat and other perishables purchased on the Taobao marketplace and via Tmall.com.

taobaoThe three new distribution centers are equipped for cold-chain storage and delivery and bring to 18 the number of Chinese cities with 24-hour, door-to-door delivery of perishables ordered via Alibaba's online marketplaces.

Cainiao says the service will be expanded to 50 cities by the end of 2015.

"The cold supply chain in China normally serves the business-to-business market," said Maggie Chen, head of Cainiao's fresh food delivery team. "However with the rising popularity of e-commerce we believe efficient cold-chain delivery in the business-to-consumers segment is sorely needed."

Last year strategy consultants Roland Berger estimated the cold chain logistics sector in China would grow at an average 25 percent per annum to be worth RMB 470 billion (US$&5.7 billion) by 2017 with B2C growth "as high as 80-120 percent".

Cainiao, which is 48 percent owned by Alibaba, provides an IT platform to support a consortium of logistics companies. For the new distribution centers, cold chain partners Hengfu Logistics and Honotop Logistics will manage the refrigerated warehouses, while Winshine Logistics and Chengbang Logistics will be responsible for last-mile delivery to consumers.

Meanwhile Cainiao says it has rolled out same-day delivery service in Shanghai and Beijing with consumers receiving goods ordered through Tmall's supermarket site on the same day if they place orders before 11 a.m. The company says the same-day service will be extended to 12 cities including Guangzhou, Shenzhen, Chengdu, Tianjin, Wuhan and Nanjing by the end of the year.

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