Manufacturing News

Alibaba direct trade sourcing site sees 10,000 orders daily

Alibaba Group's direct sourcing platform for the international trading marketplace is receiving nearly 10,000 orders per day during the first half of July, which are worth more than $30 million daily, the company said on Tuesday.

The platform, dubbed the "light cavalry" by company insiders, allows foreign buyers to list their criteria for the products they need, after which Chinese suppliers can proactively contact them and negotiate deals online, according to a statement the company sent to the Global Times Tuesday.

Before the service was introduced, Chinese suppliers could only list their information online and wait for foreign buyers to contact them. The process could be inefficient and time-consuming.

The platform has gained huge popularity since it was established in 2010, with the number of buyers using the platform growing by seven to 10 times in the past two years.

According to the statement, suppliers using the service have received $4.5 billion worth of orders in 2012, and the company expects that figure to grow to over $20 billion this year.

"Buyers' and suppliers' information and data are shared (on the platform), and they take actions based on their needs," Wu Minzhi, president of Alibaba's International Trade Division, was quoted as saying in the statement. "This is the reverse thinking style that Alibaba wants to provide to the cross-border e-commerce scene."

Lu Zhenwang, founder of Shanghai Wanqing Commerce Consulting, told the Global Times Tuesday that China's slowing foreign trade is challenging all business-to-business (B2B) companies, and that is why Alibaba is making innovative changes to improve on its original simple but less efficient model.

"If Alibaba wants to succeed in the long term, it has to ensure smooth two-way communication among buyers and suppliers and satisfy both parties. The 'light cavalry' platform is popular because it has achieved that goal," he said.

Lu said that Alibaba's most daunting - yet important - task is now to ensure that all the information about its buyers and suppliers is accurate.

"The company will be upgrading itself from an information publisher to a guardian and distri­butor of only the most valuable and trustworthy information," he said. "It needs to help its clients filter out junk information that slows down the negotiation of deals."

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