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Cold Chain Supply Chain Targeted by Chinese Firms

The fresh food e-commerce sector is expected to post rapid growth over the next five years as several enterprises in China have made investments in the sector, which is expected to stimulate the development of cold chain logistics.

Shenzhen-based delivery company SF Express has already opened Heike, an online shopping service community store, which integrates services with SF Express's cold chain logistics.

"After opening cold chain logistics, its operations will speed up when the company's partners receive more orders," said Li Dongqi, CEO at SF Best, an online food store under SF Express.

Other domestic firms are also striving to tap into the fresh food sector. Cainiao Network Technology, which was founded by Jack Ma, co-founder and chairman of Chinese e-commerce giant Alibaba, and other investors, announced recently that it planned to expand its cold chain 24-hour delivery business to Beijing and Guangzhou.

Jingdong Mall has announced plans to team up with Dalian Zhangzi Island Fishery Group, China's largest seafood company, to achieve vertical integration in the online-to-offline supply chain in the seafood sector.

E-commerce firms have become the most important factor driving the development of cold chain logistics. Last year, the capacity of cold storage in China was 26 million tonnes, up 36 percent from a year earlier. SF Best recorded sales of 400m yuan ($63.8m) in 2013, surging by 536 percent from 2012, while fresh food sales at Jingdong grew fivefold this year, compared with the sales reported in 2013.

Several analysts predicted that the cold chain industry will maintain a 20 percent growth rate this year, they also projected that an additional 30 million tonnes of cold storage will be in demand during the next five years.

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