Alibaba has been helping more than a million brick and mortar Chinese retailers in modernising their operations. It has now set up a new target. In a bid to reinvent and necessarily, efficiently innovate factories around China, Alibaba is all set to transform the country's outdated factories. It had been conducting a secret experiment on the outskirts of its hometown of Hangzhou for over three years in a row now and finally, revealed the first of its kind small factory in September. Translated as "fast rhino", the three-story facility technically known as Xunxi, is the company's attempt at providing its own computer data and technologies to help the manufacturing sector. It aims at improving efficiency and meeting rising consumer expectations.
Here's an explanation of how the new business is supposed to work:
- Based on Euromonitor International's estimates, China has a garment market worth 2.2 trillion yuan ($328 billion) and that's what paves the path for Alibaba's smart manufacturing.
- One in four clothes purchases in the country was shipped through one of its e-commerce platforms, according to Alibaba. This grants it access to a lot of data which it is going to put to use in helping out domestic garment makers through design and production planning.
- It is also set to centralise the material procurement process to help reduce costs. Also, it generally takes a lot of time for companies to bring new designs from runway to stores but Aibaba has claimed that it will be able to cut order lead by 75% with its solutions.
- The whole work process at the garment factories will be a lot smoother as workers will have high tech assistants and the workflow will be monitored digitally through computer or even smartphones.
- This process will save time and will also reduce the need to accumulate inventory. The ultimate goal is to become a one-stop production solution provider for garment merchants on its Taobao and Tmall marketplaces.
