How many resources can China Post mobilize through its cooperation with Alibaba?

Alibaba has added a new bargaining chip for its listing. The brother it brought in today to strengthen its momentum is not small, it is China Post Group Corporation. The two companies jointly signed a strategic cooperation framework agreement in the China Post Building in Beijing yesterday morning (June 12), and will carry out in-depth cooperation in logistics, e-commerce, finance, information security and other fields, and work together to build China's intelligent logistics backbone network (i.e. Cainiao Network). It is said that this move has taken an important step in the integration of my country's state-owned enterprises and private enterprises.

In this way, on the Cainiao Network platform, not only domestic private express delivery companies such as SF Express and STO Express will be connected, but also large state-owned enterprises such as China Post will be connected. Regardless of the actual installation of Cainiao Network, all the brothers that can be pulled in are now pulled in, and Cainiao Network's penetration into the nerve endings of the Chinese economy is also unattainable by other e-commerce companies. Cainiao Network believes that with the deepening of cooperation, private express delivery companies may be able to share the infrastructure and resources of state-owned enterprises through the Cainiao Network platform. However, if Cainiao really wants to do this, it must first see how China Post's resources can be used.

Let’s talk about the positive side first.

What is China Post? It is currently the largest postal network in the world.

There are 118,000 outlets across the country, including village post offices, rural service stations, and community service stores. These are great potential physical stores for O2O.

Even the most remote mountain villages and extremely cold places in China are within the reach of China Post - it is only a matter of time before e-commerce continues to sink into third- and fourth-tier cities and rural markets;

It can reach more than 200 countries and regions - Alibaba is vigorously developing cross-border e-commerce for import and export recently. The biggest shortcoming of cross-border e-commerce is logistics delivery.

The confidentiality of delivery has always been well maintained, and many important government orders are issued through China Post’s network - this can enhance the information security of Alibaba’s logistics and distribution.

China Post also has a commercial bank called China Postal Savings Bank, which can integrate online and offline with Ali Finance.

Therefore, from the perspective of imagination, Alibaba is really more powerful with the support of China Post. In the future, Cainiao Network and China Post will expand the imagination in logistics warehousing and distribution, O2O, e-commerce to the third- and fourth-tier cities and rural markets, cross-border e-commerce, logistics information security, financial service platforms, etc.

Let’s talk about the doubtful side.

The strategic cooperation between China Post and Alibaba is still a framework, which means it is still under active planning. As for how it will be implemented, we need to wait and see. Moreover, the historical problems left over from the separation of government and enterprise in China Post may become a constraint on the in-depth cooperation between the two parties in the future.

In fact, China Post has high hopes for this cooperation with Alibaba, hoping that it will also awaken China Post's vitality and market potential. Judging from the signing ceremony, there are many Jack Ma fans among China Post employees. When the general manager of the company, Li Guohua, came on stage to speak, the employees stood far away, looking embarrassed and rude. When Jack Ma came on stage, they all gathered in front to take pictures of him, and the applause for Jack Ma seemed to be louder - the limelight was obviously on Jack Ma and Alibaba.

The fact is that less than 5% of merchants on the Taobao Tmall platform use express delivery from the postal system, while 95% of deliveries are completed by non-postal companies such as STO Express. As early as 2006, China Post signed the first strategic cooperation agreement with Alibaba and launched e-mail and other e-commerce exclusive express delivery services. However, due to China Post's cost, speed and other restrictions, private express delivery companies still seized the opportunity to provide domestic e-commerce express delivery services.

However, there are successful cooperation cases between the two sides. 60% of the cross-border parcels on Alibaba's cross-border e-commerce platform AliExpress are delivered by China Post. China Post is a member of the Universal Postal Union and has great advantages in cross-border customs clearance - cross-border customs clearance requires smooth cooperation between the delivery party and customs officials, and this kind of relationship cannot be established overnight. However, as more and more cross-border e-commerce companies emerge, private enterprises that aim at cross-border delivery services are also gradually emerging.

"If China Post wants to mobilize resources, it must first solve the problem of government-enterprise reform. If it is not solved well, even if it cooperates with the purely market-oriented Alibaba, it will still restrict its pace of marketization. If the mechanism is not transformed well, there will be big problems in implementation." Liu Jianxin, deputy secretary-general of the Express Branch of the China Transport Association, told "China Entrepreneur".

As a state-owned enterprise, China Post has the right to appoint personnel, but its local companies are independent legal entities, and the two have separate offices. Therefore, in Liu Jianxin's opinion, if China Post is to be revitalized, it will take a lot of energy and time to sort out its internal organizational structure.

In addition, China Post also has to undertake basic service functions and has the attributes of public resources. Therefore, even if some routes are known to lose money, they must continue to operate. However, from the perspective of economic efficiency alone, they are definitely not as good as private express delivery. But China Post cannot choose the distribution points completely according to market logic. To put it a little off topic, it is like an American asking on Google why the efficiency of the United States Postal Service (equivalent to the China Post Group in the United States) is so low, why doesn't UPS take it over? Someone immediately jumped out and said, then who will deliver those parcels and express parcels that do not conform to the principles and logic of market efficiency?

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.