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Jack Ma: Internet will disrupt manufacturing and supply chain

Jack Ma, executive chairman of Alibaba Group, said manufacturing and supply chains will be next on the disruption list, and urged retailers and manufacturers to change their mindset and rethink their business model.

Speaking at Alibaba’s 2017 global netrepreneur conference, Ma said many customers these days look for highly customised products – therefore, mass production and the one-size-fits-all model will no longer be the norm in the future.

Ma said in the next 30 years, the development of AI, big data, cloud and machine learning will far exceed human imagination, so after the retail industry, he thinks manufacturing and supply chain will be the next ones to be disrupted. “In the past, we said ‘made in China’ or ‘made in France’, but the future will be ‘made in internet’ – it might be designed in the US, made in Germany, assembled in China and sold to the rest of the world.”

In this sense, to meet the emerging trend of personalisation, the market would transform from a B2C-centric to a C2B-centric business model, and he urged manufacturers and brands to take notice of global trends and rethink their business models or “your company won’t be able to survive.”

Logistics are a vital part of any e-commerce business’s operations, and during the conference, Ma talked about the Alibaba-SF Express dispute over data for the first time. He said he was out of town when it happened and didn’t know about the dispute until he read the newspaper. “It’s normal for companies to have minor disagreements, but it was settled in the end.”

He praised SF Express, saying it is a good company and asserted that Alibaba has no interest in competing with any logistic company.

Meanwhile, the company announced on Tuesday that it has created a committee dedicated to “five news trends” including new retail, new finance, new manufacturing, new technology and new energy to capitalise on the opportunities they present.

The new committee is comprised of core businesses including Taobao and Tmall, as well as major business affiliates including Cainiao Network and Alibaba Cloud.

Alibaba CEO Daniel Zhang will act as the president of the new committee, which would combine the business and technology capabilities in its massive ecosystem to drive further growth.

Jack Ma said the next three to five years will be a crucial period for the promotion of new economies and thus the company needs to combine the forces of business units ranging from financial services to logistics infrastructure. New economies would also help push forward the supply side reform and boost China’s domestic consumer market.

“Cloud computing, big data and internet of things would accelerate a new smart world,” he said in an open letter to employees. “We’re determined to turn new challenges into new chances,” he noted.

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