Cainiao and Nestlé developed new inventory solution to streamline e-commerce supply chain in China. Credit: Alizila.

Alibaba’s Cainiao Network (Cainiao) and Nestlé have developed a new inventory solution to streamline e-commerce supply chain in China.

Cainiao is reported to be the official global parcel tracking platform of the Alibaba Group.

The new inventory solution will integrate Nestlé’s warehouse stock with Alibaba’s platforms to create an analytics-driven shared inventory.

“Through combining resources across multiple channels, we hope to build a smarter, new supply chain.”

Nestlé has revamped its China distribution strategy with a more efficient inventory management solution, which has been developed in partnership with Cainiao.

Nestlé China e-commerce vice-president and head Rebecca Wang said: “Through combining resources across multiple channels, we hope to build a smarter, new supply chain. This will form the foundation of our New Retail efforts and provide a strong boost to our online business.

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“We were very troubled by some issues involving our Tmall Supermarket supply chains, such as low efficiency and slow shipping times, so both sides came together to develop the ‘One Inventory’ collaboration seen today.

“Cainiao provided a logistics perspective, while Nestle offered views from the brand side, coming from our experience in New Retail business strategies and understanding of supply chain infrastructures.”

Nestlé previously used to sells its products in China through four different channels on Alibaba’s e-commerce platforms, including Tmall, Tmall Supermarket, Rural Taobao and Lingshoutong.

After partnering with Cainiao, Nestlé has reduced its four distribution channels to one and moved all its stock from the online marketplaces to Cainiao warehouses across China.

Cainiao will also provide real-time supply-shortage alerts and inventory forecasts to Nestlé.

Nestlé e-commerce supply chain head Yura Zou said: “We used to often see one warehouse sell out completely, while a warehouse in another region had excess inventory.

“Each channel had its own inventory we had to manage separately. Integrating these different inventories meant improving agility in a replicable model that would remove a major pain point for the industry.”