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The Middle East has a population of about 490 million. This includes people in Qatar, Israel, Kuwait, and the United Arab Emirates which are among the top 50 with GDP per capita countries. According to Internet World Stats, the number of Internet users in the Middle East exceeds 160 million, and the Internet penetration rate is 60%, indicating a potential for e-commerce.
E-commerce platform Souq was acquired by Amazon in 2017. Noon, a 1 billion dollar e-commerce platform invested by the Saudi Arabian sovereign investment fund was launched in the UAE late September 2017. Jollychic is one of the best Chinese e-commerce representatives that ventured into the Middle East and expanding rapidly into an all-category e-commerce marketplace. With a vibrant e-commerce landscape, iMile founder Huang Zhen saw an opportunity to connect businesses in China and buyers in the Middle East.
iMile allows consumers to place orders on Chinese e-commerce platforms. These orders will be sent to iMile’s warehouse via the sellers, and transported by air to iMile’s warehouse in Saudi Arabia and the UAE, and finally to the consumers with iMile’s express delivery, forming a closed loop delivery chain.
In the Middle East, most e-commerce platforms allow COD (cash on delivery) because online payment is not yet popular and fully developed. 80% of consumers will still prefer cash on delivery. Even though COD makes online consumption easier and more accessible, many Middle East consumers are still doubtful about e-commerce. Moreover, the logistics market is still underdeveloped because many places have no clear address, house number, and zip code. This hinders efficiency during delivery.
There is also weak customer relations between sellers and buyers in the Middle East and most after-sale services fall on the logistics company. Consumers often mistook the logistics and e-commerce as one entity and often request services such as product return from the logistic company.
Considering the COD and customer service culture in the Middle East, iMile built its own localized operations team and developed their independent track management system (TMS) and warehouse management system (WMS). Delivery staff can inform customers the delivery time in advance via iMile’s App. Furthermore, the app helps to optimize delivery routes, and estimate arrival time. In terms of payment, iMile allows COD but plans to partner with local banks in the future, allowing e-payment methods such as QR code scanning. In addition, iMile will further optimize their data collection and its own address database, increasing the accuracy of delivery.
Huang believes that any overseas ventures must have product adaptation with a deep understanding of local policies and the culture.
Founded in the United Arab Emirates in 2017, iMile has now expanded to Saudi Arabia with a team of 95 of which 90% of its employees are based overseas.
Founder Huang Zhen has served as CTO of AliCloud Dubai Joint Venture and Huawei’s country manager. He has accumulated 10 years of experience in Middle East Africa. The leader of the team in Saudi Arabia has 11 years of overseas experience. The head of operations is from Amazon and UPS Middle East. They all have an in-depth understanding of local logistics. The commercial director has worked for B2C online logistics platform Lanting Jixiang, Chinese online discount retailer Vipshop and LieBao (China’s web browser).
KrASIA’s parent company 36Kr believes that with cross-borders e-commerce and local e-commerce companies building their own logistics services, iMile cannot compete with large e-commerce platforms and traditional logistics service providers in terms of economies of scale and financial resources. iMile will have to be able to improve their operations, increase their customers with more refined technologies. The only way to gain market share in this industry is to serve the real needs of e-commerce sellers.
Feel free to share your views with us on cross-border e-commerce and the future of logistics!
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