For Nicole, who has spent eight years living in the UK and boasts ample cross-border shopping experience, Black Friday came with a perk: the swift arrival of a new rice cooker ordered just days prior via AliExpress. It’s a far cry from her initial experience years ago when, as a student in the UK, she ordered a rice cooker from Amazon, paid a steep shipping fee, and then waited two months for an item that never came. Ultimately, she settled for a secondhand model from a local market.
Today, overseas shoppers like Nicole benefit from AliExpress Choice’s “five-day delivery” guarantee, which offers free shipping within five business days for packages dispatched from China. It’s a substantial improvement over the former 14-day minimum delivery window.
AliExpress Choice, launched in 2023, is a cross-border e-commerce service offering curated products with fast delivery, free returns, and monthly discounts, serving approximately 55 countries as a premium option.
Within China, Cainiao has developed a pickup network that integrates warehousing, sorting, and mainline hubs, shaving one to two days off transit times. Overseas, its “fast-in, fast-out” customs clearance model consolidates customs and warehousing steps, eliminating the need for separate sorting centers. For the last mile, Cainiao’s robust delivery networks in major Western markets enable next-day delivery for most areas once packages clear customs.
These capabilities reflect Cainiao’s evolution over the past decade.
Founded on Alibaba founder Jack Ma’s ambitious vision of achieving global 72-hour delivery, Cainiao has steadily transformed. Over the last 11 years, it has expanded from developing electronic waybills to providing warehousing and distribution services for Tmall Global and Tmall Supermarket within China. It later branched into overseas infrastructure and chartered air cargo services, establishing a global logistics network that shifted its focus from an asset-light approach to a more infrastructure-heavy model.
As Chinese merchants sought overseas growth before and after the pandemic, Cainiao and the so-called “four little dragons” of cross-border e-commerce capitalized on fresh opportunities.
Since 2022, Cainiao’s international operations—including cross-border express, supply chain management, and overseas local services—have become its main revenue driver, accounting for over 47% of total revenue. Each quarter since, the international business has contributed the largest share of the company’s growth. In fiscal 2023, Cainiao delivered over 1.5 billion cross-border parcels worldwide, serving more than 100,000 merchants and brands engaged in global trade.
Still, cross-border e-commerce remains a niche compared to domestic e-commerce in most countries, limiting its logistics market size. To address this, Cainiao has begun testing local-to-local courier services abroad in addition to cross-border direct shipping and overseas warehousing.
In Spain, for example, Cainiao’s years of investment in its logistics network allow it to handle not only shipments from China but also domestic deliveries within Spain and cross-border routes to France, Poland, and other European nations. Notably, Cainiao’s network also covers Spain’s outlying islands, enabling next-day delivery across the entire country.
Recently, 36Kr visited Cainiao’s campus in Hangzhou to interview Wei Xiong, senior vice president of Cainiao and general manager of its cross-border logistics division. Wei, who joined Cainiao in 2018 after more than a decade in strategic consulting, discussed the company’s transformations over five years of building out its global logistics network, how it navigates collaboration and competition, and how it continues to seek new growth.
The following interview has been edited and consolidated for brevity and clarity.
36Kr: How different is Cainiao today compared to when it primarily focused on electronic waybills?
Xiong Wei (XW): Every five years, Cainiao reaches a new phase of strategic development. In its first five years, the focus was on leveraging technology to support the courier industry and expanding universal logistics services. For instance, Cainiao introduced electronic shipping labels, a foundational innovation. By the third Singles’ Day shopping festival, e-commerce logistics had exploded in popularity, but domestic courier networks were still underdeveloped, necessitating the creation of a robust technical backbone.
As delivery companies scaled up, went public, and achieved greater service capabilities, Cainiao shifted its focus to innovation. In the next five-year phase, beginning in 2018, the company introduced bonded import services for Tmall Global and export solutions aimed at overseas consumers. These offerings delivered a faster, more reliable, and fully controllable end-to-end logistics experience.
36Kr: People know how Cainiao supports Tmall Supermarket and Tmall Global within China, but what about its operations abroad?
XW: Starting in 2017 and 2018, we made significant investments in two key areas.
The first was overseas infrastructure. In 2017, we launched our first e-hub in Kuala Lumpur, Malaysia, followed by additional hubs in Liege, Belgium, and Hong Kong in 2018. These nodes have greatly enhanced the efficiency of our global logistics network.
The second area was aviation. Around late 2017 and early 2018, we began building an aviation network, launching our first charter flight to Russia in 2018. Even before the pandemic, we had a robust roster of e-commerce–dedicated charter flights. When the pandemic hit, we ramped up investments in this sector. Today, Cainiao operates hundreds of charter flights every week, shipping approximately five million parcels daily from China to destinations worldwide.
36Kr: What drove Cainiao’s focus over these past five years?
XW: The cross-border logistics market itself presented the opportunity. If overseas consumers wanted to buy Chinese products, they typically only had two choices. They could choose slow and outdated national postal services, costing USD 1–2, or go with faster services like DHL or FedEx that deliver in about three days but charge around USD 100—an expense most consumers wouldn’t justify. By building our own logistics network, we struck a balance between cost and efficiency, meeting the needs of the average consumer.
36Kr: What services and pricing does Cainiao currently offer?
XW: In mid-2020, we launched our “USD 5, ten-day delivery” service, which now covers a wide range of global markets. Early last year, we introduced the “USD 10, five-day delivery” option, available in about a dozen major markets. These two services have become our most popular offerings.
36Kr: Is the five-day delivery service for AliExpress financially viable?
XW: Right now, shipping costs and the logistics fees paid by merchants and consumers don’t exactly match up, but we’re fine with letting users pay less for the moment to try out better service. Data shows that our five-day service, compared to similar packages arranged by other providers, often has a clear cost advantage.
36Kr: How do other Chinese cross-border e-commerce platforms stack up in terms of delivery speed?
XW: It depends on each platform’s logistics strategy. Amazon, for example, primarily focuses on ten-day deliveries and hasn’t yet moved to introduce five-day options. In contrast, platforms like AliExpress, Temu, and Shein have collectively raised the industry standard by emphasizing five- and ten-day delivery options.
With Chinese products already excelling in price and quality, ongoing advancements in logistics are poised to further encourage overseas consumers to increase their purchases.
36Kr: What are Cainiao’s current cross-border parcel volumes?
XW: We now handle about five million parcels a day, which is around one-third of all cross-border export packages leaving China. The other two-thirds come from other platforms and smaller shipments. Globally, if you compare us to top logistics companies like FedEx and DHL, they each process roughly one million parcels daily.
36Kr: How big a share of Cainiao’s export volume does AliExpress command?
XW: AliExpress is a key client of Cainiao. We have an entire team dedicated to supporting it with custom logistics solutions. We also have another team serving other market clients.
36Kr: We’ve heard that Cainiao is working to cooperate more with companies like Temu and Shein. Any updates?
XW: AliExpress is a major client, but we also collaborate with other platforms in specific service areas. These partnerships leverage our logistics network to achieve scale and efficiency.
36Kr: Does this suggest that internet giants are less competitively rigid with one another now?
XW: In the past, the focus was largely on strategic defense. Today, the approach is more commercially and market-driven. By allowing more players to leverage Cainiao’s logistics network, we not only achieve better economies of scale but also contribute to upgrading the entire supply chain.
36Kr: 2024 marks the start of a new five-year plan for Cainiao. What’s next?
XW: We will keep expanding our global network of major hubs to go beyond just import and export. We’re also investing in large-scale local courier services overseas, such as routes from the Middle East to Europe or from North America to South America, with the goal of building a truly worldwide network. This marks Cainiao’s 3.0 phase.
We’ve already established at least ten local networks worldwide. In Spain, for instance, we handle last-mile deliveries from China to Spain, as well as shipping within Spain and from Spain to France, Poland and other countries.
36Kr: The “four little dragons” have been aggressively expanding overseas, and AliExpress has risen in importance within Alibaba. How is Cainiao handling these added demands?
XW: AliExpress has been around for over a decade, and growth took off after the pandemic. Competition is intensifying, but we are collectively enlarging the market for cross-border e-commerce, which is a healthy trend.
Late last year and early this year, we also updated our operating mechanisms: Cainiao and AliExpress signed a framework agreement for a customized solution, simplifying our commercial relationship and enabling more efficient solutions for merchants and consumers alike.
KrASIA Connection features translated and adapted content that was originally published by 36Kr. This article was written by Peng Qian for 36Kr.