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Chinese logistics companies expanding internationally are combining traditional Chinese operational models with locally recruited staff to boost their global footprint. By harnessing advanced technology and focusing on localization, these businesses are quickly making inroads into foreign markets.
For example, one major logistics division of a prominent e-commerce corporation operates a warehouse in Malaysia that closely mirrors its Chinese counterparts. Fast-moving items are stored on lower shelves, slower items on higher shelves, and dynamic sorting equipment manages peak periods efficiently. Most of the personnel, however, are sourced locally.
The Malaysian warehouse features a prayer room for Muslim employees to perform daily prayers, and on Fridays, staff are given a half-hour break to attend mosque services. Some employees also wear religious attire while working.
Innovative technology such as smart warehousing, automated production lines, and intelligent order batching are significantly enhancing operational efficiency. Smart warehousing involves systematic storage that allows for swift movement of goods in and out, optimizing space and increasing capacity. Intelligent batching consolidates similar orders and ships them using a first-in, first-out method, which speeds up processing.
Thanks to these technological advancements, outbound deliveries from the Malaysian warehouse, which previously took two to three days to process, can now often be shipped on the same day, reducing shipping times by at least one day, according to Bruce, the company’s global supply chain manager for Singapore and Malaysia.
Nonetheless, Chinese logistics firms still encounter considerable obstacles on their international journeys, and successful localization remains critical to operational success, Bruce noted, who assumed his current role in January.
In Malaysia, the company employs a “warehouse-centric collaboration” model, partnering with local third-party providers for last-mile deliveries instead of handling those directly. This strategy aligns with Malaysia’s distribution culture, which favors pickup points over home deliveries, and also considers regulatory restrictions.
Choosing the right warehouse location is another challenge. “Warehouse resources are unevenly distributed in Malaysia and vary in quality,” Bruce explained. “You need to select the appropriate warehouse type and location based on your product categories and business needs. Many warehouses are clustered in specific areas, so identifying the best spot within those clusters can be complicated.”
To tackle this, the company has deployed a dedicated warehouse selection team in Malaysia. The team comprises experts with over ten years of experience in China and two to three years of local market knowledge, and it is continuously expanding.
Despite these challenges, the volume of business at the Malaysian facility has grown several times over since the start of the year.
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