New Cainiao freight flights to cut Lazada logistics costs to East Malaysia by -50% – The Moodie Davitt Report – The Moodie Davitt Report
CHINA/MALAYSIA. Alibaba Group logistics arm Cainiao Network has announced the launch of direct air freight from China to East Malaysia to enhance ecommerce platform Lazada’s cross-border logistics. The company said the move has been made to enhance delivery efficiency and stability amid growing consumer demand.
Three times weekly, direct flights will go to Kota Kinabalu and Kuching in the Malaysian states of Sabah and Sarawak respectively.
The establishment of the new freight flights by Cainiao will facilitate faster delivery times from Lazada to consumers in East Malaysia
Cainiao noted that this will reduce logistics cost by over -50 per% for Sabah and Sarawak customers. It will shorten average delivery time by two days, from 14 to 12 days or as fast as seven days.
Previously, shipping to East Malaysia locations such as Sabah and Sarawak typically entailed multiple modes of transportation. This included flying freight to Kuala Lumpur, a domestic flight to Kota Kinabalu or Kuching, followed by last mile courier delivery to consumers’ doorsteps.
Cainiao pointed out that currently pandemic and movement control order restrictions on international and domestic commercial and cargo flights have further lengthened delivery time and exacerbated delivery challenges.
To instill greater long-term shipping stability and deliver higher levels of customer experience, Cainiao and Lazada have been working together to establish a comprehensive cross-border logistics network in Malaysia. With a stable and seamless logistics value chain, customers in Malaysia can now gain access to a wider array of global products from countries such as China, South Korea and Japan.
Cainiao Executive General Manager and Chief LazGlobal Logistics Officer Shawn Louis said: “Industry data revealed that Malaysia’s ecommerce is set to more than double from US$6 billion to US$13 billion from 2020 to 2025, with 61% of cross-border ecommerce purchases from China.
Lazada’s branded destination LazMall – the Southeast Asia region’s largest virtual mall – houses over 32,000 international and local brands
“Against the backdrop of growing consumer demand and increased e-tailer competition, superior logistics services will continue to be the key differentiator for merchants to improve customer experience and establish their competitive edge.”
He added: “In our efforts to further streamline the logistics value chain and deliver a more efficient and seamless shipping service to end consumers, we have launched a direct air freight route to East Malaysia, effectively removing domestic air freight and ground transfers.
“This logistics upgrade will benefit consumers in East Malaysia as they can now enjoy the same delivery timeliness and shipping cost as those in West Malaysia.”
The latest logistics enhancement announcement comes after the commencement of operation of the Cainiao Aeropolis eWTP Hub, an e-fulfilment hub located at Kuala Lumpur International Airport (KLIA), in November 2020.
The move aims to shape Malaysia into a major regional player for ecommerce distribution and a leading airfreight gateway in ASEAN. The first customer to leverage the hub’s facilities was Lazada.
Lazada has operations in Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam, offering logistics, retail technology and payment services solutions to its sellers.
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