Alibaba (BABA) Aids U.S. Businesses With Logistics Marketplace
Alibaba (BABA) Aids U.S. Businesses With Logistics Marketplace Yahoo Finance
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Alibaba Launches Logistics Marketplace for SMEs in the United States
Alibaba has introduced Logistics Marketplace, an affordable logistics solution for small and medium-sized enterprises (SMEs) in the United States. This solution aims to reshape supply chain strategies and overcome traditional logistics challenges.
The Logistics Marketplace provides a platform for buyers and pre-vetted logistics service providers to connect and offer tailored solutions to target customers. It allows buyers to compare real-time quotes from different providers, book customized solutions, and access verified options such as customs clearance, storage, combined shipments, and drop shipping.
The platform also includes features like “Send Inquiry” and “Logistics RFQ” for sellers, streamlining their process of partnering with freight forwarders. This move is expected to help SMEs expand their global reach and gain traction in the United States.
Alibaba Group Holding Limited Price and Consensus
Alibaba Group Holding Limited price-consensus-chart | Alibaba Group Holding Limited Quote
Strengthening Logistics Services Aids Growth
In addition to the Logistics Marketplace, Alibaba’s logistics arm Cainiao has launched a “consolidated shipping” service in the United States to enhance its overseas logistics offerings. This service combines multiple shopping orders from various Chinese e-commerce platforms and delivers them to U.S. customers through air and sea transport routes, reducing delivery times to as little as five days.
Furthermore, Alibaba has introduced Cainiao Express, a new express delivery service that offers doorstep, half-day, same-day, and next-day deliveries to select Alibaba-owned businesses.
The company has also announced plans to invest $1.1 billion in South Korea over three years to build a logistics center and expand its operations in the country. Additionally, Alibaba will invest $200 million this year for the development of the logistics center and $100 million for small and mid-sized firms.
All these initiatives are expected to help Alibaba capitalize on the growth opportunities in the global logistics market, which is projected to reach $16.79 trillion by 2032, with a CAGR of 5.6% between 2023 and 2032 according to Allied Market Research.
By strengthening its position in the logistics market, Alibaba aims to improve its overall financial performance in the near term. The Zacks Consensus Estimate for Alibaba’s fiscal 2024 revenues is $130.77 billion, indicating a year-over-year growth of 3.7%.
Stiff Competition
Despite its efforts, Alibaba faces tough competition from industry players like Amazon and JD.com in the logistics market. Alibaba’s shares have declined by 11.2% year-to-date, underperforming the Zacks Retail-Wholesale sector’s return of 6.4%.
Amazon has introduced “Supply Chain by Amazon,” an end-to-end supply chain service that allows third-party sellers to handle inventory, shipping, customs clearance, storage, and delivery to customers.
JD.com has expanded its international express delivery service from Guangzhou and Shenzhen to nearly every district in China. The service offers efficient logistics solutions for various products, including documents and apparel, with the United States, the U.K., and Germany as top destinations. JD.com has also partnered with Geopost to enhance its global logistics capabilities.
Zacks Rank & Stock to Consider
Alibaba currently holds a Zacks Rank #4 (Sell). A better-ranked stock in the same sector is The Gap, which has a Zacks Rank #1 (Strong Buy) and has gained 2.8% year-to-date with a long-term earnings growth rate of 12%.
For the latest recommendations from Zacks Investment Research, you can download the 7 Best Stocks for the Next 30 Days.
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