An aerial view of a port in Qingdao, east China's Shandong province. Cainiao, a start-up, is disrupting the logistics industry. AFP
An aerial view of a port in Qingdao, east China's Shandong province. Cainiao, a start-up, is disrupting the logistics industry. AFP
An aerial view of a port in Qingdao, east China's Shandong province. Cainiao, a start-up, is disrupting the logistics industry. AFP
An aerial view of a port in Qingdao, east China's Shandong province. Cainiao, a start-up, is disrupting the logistics industry. AFP

What an Alibaba-owned start-up can teach us about innovation


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The impediment to the growth of e-commerce is no longer consumer demand, which has soared in the past year as many shoppers have been unable or unwilling to visit brick-and-mortar stores due to the coronavirus pandemic.

The drive for efficiency has become even more critical as border closures and lockdown restrictions have made deliveries trickier. Brexit has been an added challenge for many shops in the UK.

The logistics companies that transport these goods from warehouses to our doors are vital to retailers, and even governments as they look to logistics companies to transport coronavirus vaccines. But traditional methods of shipping goods are inefficient and wasteful.

There is now another option for merchants of all kinds. Cainiao lives in the shadow of its parent company, Chinese internet giant Alibaba. But it has been quietly building an unconventional logistics platform that could transform the distribution of products in future.

The brainchild of Chinese tycoon Jack Ma and others, Cainiao is different from traditional logistics companies because it does not own most of the warehouses or depots it cleverly leverages. Instead of buying trucks and fuel, it has built up a 3,000-strong network of “logistics partners” who do the actual deliveries.

Cainiao carefully curates and aggregates established logistics partners. This scale provides merchants with ample data to choose the most efficient delivery option through the Cainiao platform.

The company puts sensors on everything and is bringing about a digital revolution in distribution. After achieving strong traction at home in China’s $2 trillion e-commerce market, the company is starting to expand globally in Belgium, Malaysia, Russia, Thailand and Dubai without ever building a single warehouse.

This asset-light approach has allowed Cainiao to piggy-back off existing infrastructure and to scale up quickly in a mature sector, while avoiding steep fixed costs while being nimbler. This way, it is able to respond quickly to changes in market demand.

At a time when logistics companies are vital to e-commerce and vaccine delivery, this resilient model strengthens supply chains. Brexit complications have further highlighted the need for a strong logistics network today. If a logistics partner goes bust or leaves the platform, it will not compromise the stability of the wider network because the slack can be absorbed quickly.

Technology and data are at the heart of the model, which streamlines deliveries. Cainiao tracks all the transactions in its ecosystem and crunches the data to produce actionable insight that benefits everyone, including the end consumer who gets greater availability of products.

Cainiao uses predictive analytics to forecast consumer demand and help its partners allocate stock and pick warehouse locations. It also uses data from delivery fleets to optimise shipping routes, improving efficiency and trimming fuel costs. When more partners join, not only does the ecosystem diversify, the efficiency of the whole network increases.

The company has also created more than 80,000 “Cainiao Post” stations where people can pick up their orders, with the goods dropped off by local couriers. These stations are embedded within local communities such as schools and create sustainable, viable job opportunities. This form of community entrepreneurship is reminiscent of the township and village enterprises that played a pivotal role in China’s transition to a more market-based economy following reforms enacted in the late 1970s.

Alibaba acquired a controlling stake in Cainiao in 2017. Bloomberg
Alibaba acquired a controlling stake in Cainiao in 2017. Bloomberg

The company does not represent an existential threat to traditional delivery operators. Rather, Cainiao can be the rising tide that lifts all boats. Instead, the threat is levied at e-commerce platforms such as JD or Amazon, which has taken an asset-heavy approach, building vast fulfilment centres all over the world.

Since Cainiao is part of Alibaba, it can offer merchants a full suite of services. A retailer could sell their goods on Taobao, Alibaba’s e-commerce platform and process the transactions on its payment platform Ant Financial. Sellers are free to choose other providers. Increasingly, though, they will be tempted to be part of the Alibaba ecosystem for the efficiency gains, which will become more crucial in weathering the coronavirus-induced recession.

But China has launched an antitrust probe into Alibaba, which it accuses of monopolistic practices. That followed the suspension of Ant’s $37 billion initial public offering. How such an investigation will hit Cainiao’s growth remains to be seen, but the open nature of Cainiao’s ecosystem appears to be prepared for the future.

The good news for sellers, who will be on the lookout for stability in these uncertain times, is that, without a heavy base of fixed assets, the company can be agile in responding to market regulators. This reflects how new models of trade can enable wider economic and social success.

Mark Greeven is Professor of Innovation and Strategy at IMD

Key facilities
  • Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
  • Premier League-standard football pitch
  • 400m Olympic running track
  • NBA-spec basketball court with auditorium
  • 600-seat auditorium
  • Spaces for historical and cultural exploration
  • An elevated football field that doubles as a helipad
  • Specialist robotics and science laboratories
  • AR and VR-enabled learning centres
  • Disruption Lab and Research Centre for developing entrepreneurial skills

Directed by: Craig Gillespie

Starring: Emma Stone, Emma Thompson, Joel Fry

4/5

Profile

Company name: Jaib

Started: January 2018

Co-founders: Fouad Jeryes and Sinan Taifour

Based: Jordan

Sector: FinTech

Total transactions: over $800,000 since January, 2018

Investors in Jaib's mother company Alpha Apps: Aramex and 500 Startups

The five stages of early child’s play

From Dubai-based clinical psychologist Daniella Salazar:

1. Solitary Play: This is where Infants and toddlers start to play on their own without seeming to notice the people around them. This is the beginning of play.

2. Onlooker play: This occurs where the toddler enjoys watching other people play. There doesn’t necessarily need to be any effort to begin play. They are learning how to imitate behaviours from others. This type of play may also appear in children who are more shy and introverted.

3. Parallel Play: This generally starts when children begin playing side-by-side without any interaction. Even though they aren’t physically interacting they are paying attention to each other. This is the beginning of the desire to be with other children.

4. Associative Play: At around age four or five, children become more interested in each other than in toys and begin to interact more. In this stage children start asking questions and talking about the different activities they are engaging in. They realise they have similar goals in play such as building a tower or playing with cars.

5. Social Play: In this stage children are starting to socialise more. They begin to share ideas and follow certain rules in a game. They slowly learn the definition of teamwork. They get to engage in basic social skills and interests begin to lead social interactions.

Zakat definitions

Zakat: an Arabic word meaning ‘to cleanse’ or ‘purification’.

Nisab: the minimum amount that a Muslim must have before being obliged to pay zakat. Traditionally, the nisab threshold was 87.48 grams of gold, or 612.36 grams of silver. The monetary value of the nisab therefore varies by current prices and currencies.

Zakat Al Mal: the ‘cleansing’ of wealth, as one of the five pillars of Islam; a spiritual duty for all Muslims meeting the ‘nisab’ wealth criteria in a lunar year, to pay 2.5 per cent of their wealth in alms to the deserving and needy.

Zakat Al Fitr: a donation to charity given during Ramadan, before Eid Al Fitr, in the form of food. Every adult Muslim who possesses food in excess of the needs of themselves and their family must pay two qadahs (an old measure just over 2 kilograms) of flour, wheat, barley or rice from each person in a household, as a minimum.

MATCH INFO

Uefa Champions League, semi-final result:

Liverpool 4-0 Barcelona

Liverpool win 4-3 on aggregate

Champions Legaue final: June 1, Madrid

UAE currency: the story behind the money in your pockets
Company Profile

Company name: Fine Diner

Started: March, 2020

Co-founders: Sami Elayan, Saed Elayan and Zaid Azzouka

Based: Dubai

Industry: Technology and food delivery

Initial investment: Dh75,000

Investor: Dtec Startupbootcamp

Future plan: Looking to raise $400,000

Total sales: Over 1,000 deliveries in three months

Global Fungi Facts

• Scientists estimate there could be as many as 3 million fungal species globally
• Only about 160,000 have been officially described leaving around 90% undiscovered
• Fungi account for roughly 90% of Earth's unknown biodiversity
• Forest fungi help tackle climate change, absorbing up to 36% of global fossil fuel emissions annually and storing around 5 billion tonnes of carbon in the planet's topsoil

if you go

The flights

Etihad, Emirates and Singapore Airlines fly direct from the UAE to Singapore from Dh2,265 return including taxes. The flight takes about 7 hours.

The hotel

Rooms at the M Social Singapore cost from SG $179 (Dh488) per night including taxes.

The tour

Makan Makan Walking group tours costs from SG $90 (Dh245) per person for about three hours. Tailor-made tours can be arranged. For details go to www.woknstroll.com.sg

Tenet

Director: Christopher Nolan

Stars: John David Washington, Robert Pattinson, Elizabeth Debicki, Dimple Kapadia, Michael Caine, Kenneth Branagh 

Rating: 5/5

THE BIO

Favourite car: Koenigsegg Agera RS or Renault Trezor concept car.

Favourite book: I Am Pilgrim by Terry Hayes or Red Notice by Bill Browder.

Biggest inspiration: My husband Nik. He really got me through a lot with his positivity.

Favourite holiday destination: Being at home in Australia, as I travel all over the world for work. It’s great to just hang out with my husband and family.

 

 

The burning issue

The internal combustion engine is facing a watershed moment – major manufacturer Volvo is to stop producing petroleum-powered vehicles by 2021 and countries in Europe, including the UK, have vowed to ban their sale before 2040. The National takes a look at the story of one of the most successful technologies of the last 100 years and how it has impacted life in the UAE. 

Read part four: an affection for classic cars lives on

Read part three: the age of the electric vehicle begins

Read part one: how cars came to the UAE

 

ESSENTIALS

The flights

Emirates flies from Dubai to Phnom Penh via Yangon from Dh2,700 return including taxes. Cambodia Bayon Airlines and Cambodia Angkor Air offer return flights from Phnom Penh to Siem Reap from Dh250 return including taxes. The flight takes about 45 minutes.

The hotels

Rooms at the Raffles Le Royal in Phnom Penh cost from $225 (Dh826) per night including taxes. Rooms at the Grand Hotel d'Angkor cost from $261 (Dh960) per night including taxes.

The tours

A cyclo architecture tour of Phnom Penh costs from $20 (Dh75) per person for about three hours, with Khmer Architecture Tours. Tailor-made tours of all of Cambodia, or sites like Angkor alone, can be arranged by About Asia Travel. Emirates Holidays also offers packages. 

THE BIO

Bio Box

Role Model: Sheikh Zayed, God bless his soul

Favorite book: Zayed Biography of the leader

Favorite quote: To be or not to be, that is the question, from William Shakespeare's Hamlet

Favorite food: seafood

Favorite place to travel: Lebanon

Favorite movie: Braveheart

ETFs explained

Exhchange traded funds are bought and sold like shares, but operate as index-tracking funds, passively following their chosen indices, such as the S&P 500, FTSE 100 and the FTSE All World, plus a vast range of smaller exchanges and commodities, such as gold, silver, copper sugar, coffee and oil.

ETFs have zero upfront fees and annual charges as low as 0.07 per cent a year, which means you get to keep more of your returns, as actively managed funds can charge as much as 1.5 per cent a year.

There are thousands to choose from, with the five biggest providers BlackRock’s iShares range, Vanguard, State Street Global Advisors SPDR ETFs, Deutsche Bank AWM X-trackers and Invesco PowerShares.

Brief scores:

Toss: Sindhis, elected to field first

Kerala Knights 103-7 (10 ov)

Parnell 59 not out; Tambe 5-15

Sindhis 104-1 (7.4 ov)

Watson 50 not out, Devcich 49

The Bio

Favourite vegetable: “I really like the taste of the beetroot, the potatoes and the eggplant we are producing.”

Holiday destination: “I like Paris very much, it’s a city very close to my heart.”

Book: “Das Kapital, by Karl Marx. I am not a communist, but there are a lot of lessons for the capitalist system, if you let it get out of control, and humanity.”

Musician: “I like very much Fairuz, the Lebanese singer, and the other is Umm Kulthum. Fairuz is for listening to in the morning, Umm Kulthum for the night.”

MATCH INFO

Real Madrid 3 (Kroos 4', Ramos 30', Marcelo 37')

Eibar 1 (Bigas 60')

RESULTS

Bantamweight: Jalal Al Daaja (JOR) beat Hamza Bougamza (MAR)

Catchweight 67kg: Mohamed El Mesbahi (MAR) beat Fouad Mesdari (ALG)

Lightweight: Abdullah Mohammed Ali (UAE) beat Abdelhak Amhidra (MAR)

Catchweight 73kg: Mosatafa Ibrahim Radi (PAL) beat Yazid Chouchane (ALG)

Middleweight: Yousri Belgaroui (TUN) beat Badreddine Diani (MAR)

Catchweight 78KG: Rashed Dawood (UAE) beat Adnan Bushashy (ALG)

Middleweight: Sallah-Eddine Dekhissi (MAR) beat Abdel Enam (EGY)

Catchweight 65kg: Yanis Ghemmouri (ALG) beat Rachid Hazoume (MAR)

Lightweight: Mohammed Yahya (UAE) beat Azouz Anwar (EGY)

Catchweight 79kg: Souhil Tahiri (ALG) beat Omar Hussein (PAL)

Middleweight: Tarek Suleiman (SYR) beat Laid Zerhouni (ALG)

UAE currency: the story behind the money in your pockets
UAE currency: the story behind the money in your pockets
Specs
Engine: Electric motor generating 54.2kWh (Cooper SE and Aceman SE), 64.6kW (Countryman All4 SE)
Power: 218hp (Cooper and Aceman), 313hp (Countryman)
Torque: 330Nm (Cooper and Aceman), 494Nm (Countryman)
On sale: Now
Price: From Dh158,000 (Cooper), Dh168,000 (Aceman), Dh190,000 (Countryman)
The specs

Engine: 1.5-litre turbo

Power: 181hp

Torque: 230Nm

Transmission: 6-speed automatic

Starting price: Dh79,000

On sale: Now

UPI facts

More than 2.2 million Indian tourists arrived in UAE in 2023
More than 3.5 million Indians reside in UAE
Indian tourists can make purchases in UAE using rupee accounts in India through QR-code-based UPI real-time payment systems
Indian residents in UAE can use their non-resident NRO and NRE accounts held in Indian banks linked to a UAE mobile number for UPI transactions

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%3Cp%3E%3Cstrong%3EDirector%3A%3C%2Fstrong%3E%20Lee%20Sang-yong%3Cbr%3E%3Cstrong%3EStars%3A%3C%2Fstrong%3E%20Don%20Lee%2C%20Lee%20Jun-hyuk%2C%20Munetaka%20Aoki%3Cbr%3E%3Cstrong%3ERating%3A%20%3C%2Fstrong%3E3%2F5%3Cbr%3E%3Cbr%3E%3C%2Fp%3E%0A
BEACH SOCCER WORLD CUP

Group A

Paraguay
Japan
Switzerland
USA

Group B

Uruguay
Mexico
Italy
Tahiti

Group C

Belarus
UAE
Senegal
Russia

Group D

Brazil
Oman
Portugal
Nigeria