China's e-commerce giant Alibaba is reportedly selling cargo spaces to merchants on Maersk container ships through its One Touch platform, a Reuters report said.
According to Maersk, the One Touch service helps merchants by streamlining the export process, taking out the freight forwarders or the middlemen between merchants and shipping lines. Through the service, merchants can lock in cargo space by paying a deposit in advance.
Internet Retailer, a trade publication, said that Alibaba's One Touch platform, the fastest growing unit in the company's business-to-business (B2B) division, has already served more than 20,000 merchants. The platform offers a range of export services to merchants, which include financing and dealing with customs.
Alibaba's move is seen as a shift towards increasing exposure to global logistics business, which it can achieve in two ways: one, by partnering with companies such as Maersk, the world's largest container-shipping firm, and the U.S. Postal Service, and another way, by investing directly such as pouring $300 million into SingPost, Singapore's postal service.
This is in addition to services provided by Cainiao, in which Alibaba has 47 percent stake. About 70 percent of deliveries in mainland China are handled by Cainiao, with distribution hubs the size of 37 football field, Bloomberg reported. Alibaba also holds a minority stake in YTO Express.
Alibaba's investments in logistics worth billions of dollars dwarfed Amazon's, which has a fleet of cargo planes and has thousands of delivery trucks for its own use.
Amazon also has 68.5 million square feet warehouse and distribution area, half of what Walmart has, according to Bloomberg.
Although the two companies are regarded as competitors, they differ from each other in some ways. Alibaba helps retailers and suppliers get customers, and unlike Amazon, does not have its own inventory. This allows Alibaba to build its own infrastructure, from payment to logistics, and now has ventured into China shipping.