Alibaba extends New Retail push with US$693 million investment in STO Express
- Many of China’s courier firms have risen together with the rapid growth of e-commerce in the country
- Alibaba wants a strong logistics network so that it can deliver goods as fast as possible
Alibaba Group Holding’s latest investment in Chinese courier company STO Express comes as China’s largest e-commerce company looks to bolster its New Retail strategy of integrating online and offline shopping.
The 4.66 billion yuan (US$693 million) investment in Shanghai-headquartered STO Express is Alibaba’s fourth investment in an express courier company. Before STO Express, Alibaba had taken minority stakes in Chinese courier firms YTO Express, ZTO Express and Best Inc.
New York-listed Alibaba already operates logistics affiliate Cainiao Network, which runs a platform that does everything from digitising and standardising waybills to route optimisation for couriers.
Alibaba’s investment for an almost 15 per cent stake in STO Express comes as the logistics sector becomes a key area of development for China, as a crucial part of its infrastructure and economy.
Many of China’s courier firms have risen together with the rapid growth of e-commerce in the country, with seven such firms going public in 2017 alone. In 2018, total parcel volume reached almost 51 billion.
“We will deepen our existing collaboration with STO in technology, last-mile delivery across China and New Retail logistics,” said Alibaba in a statement.
