Alibaba, China’s gigantic business entity, is making a move to increase its presence in the Indian sub-continent. The company is partnering up with the likes of DHL and Delhivery to provide domestic and international logistics support to Indian sellers. It will also be offering financial aid in the country, through its partnerships with various prominent banks.
Before going any further, lets take a quick look at the B2B system. Strictly speaking, B2B or Business to Business, can be defined as the exchange of material or non-material goods between businesses, rather than between businesses and consumers. A B2B platform basically caters to other businesses, which may range between small and medium in size, and provides them with products, services or information on a wholesale basis.
Alibaba is an extremely relevant example of B2B and the scope possessed by this industry. The company caused a major upheaval in the Chinese economy, when it began using its platform to provide merchants with access to International sellers and vice-versa. The company is now ramping up the capabilities of its B2B platform in India by partnering up with major logistic solution providers, DHL and Delhivery.
This collaboration will be deployed for the benefit of Indian sellers by providing them with domestic and international logistics support. Alibaba is not limiting itself to carting goods though and will also be offering financial aid through its tie-ups with Aditya Birla Group’s NBFC arm, IDFC Bank and Kotak Mahindra Bank.
While IDFC Bank and Kotak Mahindra will be lending to sellers, merchants will be receiving most of the working capital support through Aditya Birla Finance. The main beneficiaries of this program will be SMEs (Small and Medium Enterprises) and startups, who will be able to deploy Alibaba’s extensive network and reseller platform for their own purposes, while also receiving financial aid.
The effort will be led by Vinay Bhartia, senior VP, who will be accompanies by Guru Gowrappan, global MD at Alibaba. The duo will be working to significantly ramp up the B2B capabilities Alibaba has in the country. Considering that Alibaba has been hiring executives lately, we can expect Bhartia and Gowrappan to have a good team to lead.
This effort will also pit it against global arch-rival Amazon Business, which also has a presence here.
Speaking with the Times Of India, a person with information about the subject, said,
Their B2B platform has been around for years but they haven’t been able to make much progress scaling it. Now it seems they are seriously looking to focus on the B2B side by helping sellers with working capital and logistics.They’ll also bring in Chinese vendors onto the site as they have great depth in the merchant ecosystem back home.
Alibaba already has an active reseller program in the country. A few months ago though, it started shutting down its offices across the country, resulting in en-mass layoffs. It has been operating in India since 2007 claims to have around 4.46 million registered Indian buyers and sellers by end of 2014.
Meanwhile, this news can be taken to mean that the company, amid rumors of directly entering the consumer facing e-commerce market, will simultaneously be bulking up the capabilities of its reseller platform as well.