News / Alibaba extends partnership with KN to cover cross-border B2B shipments

12/04/2017

Kuehne + Nagel this morning signed an agreement with the world’s largest e-commerce platform, Alibaba, to cover B2B volumes.

The memorandum of understanding (MoU) deepens an existing partnership and is further evidence of Alibaba’s strategy of engaging as many logistics service providers and freight carriers as possible – in contrast to Amazon’s apparent preference for controlling as much of its supply chain as possible.

KN and Alibaba already have an arrangement for the e-commerce platform’s sellers to use the 3PL’s air freight and less-than-container load (LCL) solutions for cross-border shipments.

Today’s MoU extends that to include the full scope of KN’s forwarding services – including full ocean container loads and ground and contract logistics services both inside and outside China.

Steve Su, director of Logistics at Alibaba.com, said: “We are pleased to partner with Kuehne + Nagel to offer our SME customers comprehensive logistics services, enabling them to capitalise on cross-border trade opportunities.”

Wong Siew Loong, president of North Asia at Kuehne + Nagel, said: “We are excited to enter this MoU with Alibaba.com bringing together Alibaba’s e-commerce penetration with Kuehne + Nagel’s worldwide logistics capabilities. For Kuehne + Nagel, the establishment of this relationship is in line with our global strategy to digitalise logistics services in order to meet the evolving needs of customers today.”

The major obstacle to the growth of Alibaba beyond its domestic market in China has been the complexities of cross-border e-commerce shipment, especially in terms of customs.

The deal follows a slew of other agreements between Alibaba and freight service providers. Maersk, CMA CGM and Zim all offer ocean booking services to Chinese shippers, while Flexport and SEKO Logistics are among 3PLs picked to help with shipments.

Flexport chief executive Ryan Petersen told The Loadstar: “They are driving real volumes onto our platform though it does remain small, and it is small shippers. Alibaba is dominant in China but has had a hard time making it elsewhere.

“They are certainly interested in the financial aspect of the transactions, and how they make money out of it, so we’ll see what happens,” he added.

In addition, the WCA’s e-commerce network has also signed a deal with Alibaba, potentially offering the platform access to up its 4,000-plus member forwarders.

“Alibaba has ambitions to be as well-known as Amazon in Europe and the US, but needs logistics to do so,” WCA chief executive Dan March told last year’s FIATA conference in Dublin.