Taiwan-based TV and online retailer Momo.com Inc (富邦媒體) yesterday discussed its efforts to expand its logistics ahead of next month’s Double 11 shopping event.
Some delivery bottlenecks are inevitable as it seeks to achieve massive transaction volumes during the shopping frenzy, president Lin Chi-feng (林啟峰) said.
Singles’ Day — which started in China with Alibaba Group Holding Ltd (阿里巴巴) and other Internet operators — has become the biggest shopping event in Taiwan, Lin said.
It is still growing as conventional retail chains and department stores have begun to time their annual promotions to coincide with the event, Lin said.
As a result, the delivery capabilities of retailers and their logistic partners are facing challenging tests, and timeliness has become a deciding factor in winning consumers’ hearts in the nation’s saturated e-commerce landscape, he said.
Lin outlined a three-year plan to achieve his vision of a shorter logistic chain to ease strains.
The company is seeking land in Tainan on which to build a large automated warehouse to serve as a major hub for southern Taiwan, and it plans to cut delivery times by adding 10 to 30 satellite warehouses over the next three years, he said.
“There is a limit to the overall logistic capacity in Taiwan,” Lin said. “Beyond a certain point, you simply cannot fit any more vehicles on the streets.”
Fleets of light vehicles, such as scooters and motorized tricycles, could also be employed, he added.
Double 11 would be instrumental in drawing out bargain hunters and releasing pent-up demand, as the US-China trade dispute has dampened consumer sentiment, Lin said.
Consumer electronics, usually the worst-performing category, has seen improved margins as brands are more willing to offer more competitive pricing due to their dependence on the e-commerce platforms, Lin said.
While major competitors have begun exploring the potential of unstaffed stores, Momo.com has no immediate plans to move in the direction, Lin said, adding that automated stores are untested and do not warrant much effort or investment.
Rather than being an innovator, it makes sense to adopt a viable system at some point, he added.
Momo.com has no plans to implement a cross-border platform, as a single government directive could raise barriers and nullify investment efforts, Lin said.
Net income rose 28 percent annually to NT$310 million (US$10 million) last quarter, with earnings per share of NT$2.22, while sales grew 22.3 percent to NT$9.81 billion.
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