Alibaba.com's president explains how AI tools let SMEs access global supply chains

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0:50I've come to the Co-Create event in East London, organised by Alibaba.com and its teaming with entrepreneurs. My name is Inam Ilahi and I've come here just to network, understand, get some inspiration on business ideas. I'm Jennifer and I came along to be inspired and see what people are doing in business and what I could possibly create and go into. Alibaba.com is a global online marketplace for B2B wholesale trade. SMEs can use it to source from manufacturers and trading companies products in bulk to then sell to consumers themselves. Alibaba.com is part of Alibaba Group, founded by Jack Ma in China in 1999.

1:32Alibaba.com now connects 50 million buyers with 200 ,000 global sellers and suppliers, many of them in China. My favorite clothes, just for female clothes, just like a hoodie or jacket or some leather jacket is my favorite product. And where are you based? I'm based in China.

1:55At CoCreate, there are suppliers showing off their wares, including everything from robot vacuum cleaners to skincare products and fashion items. If you have an idea of something you'd like to sell to consumers, you'll probably find it on alibaba.com's vast network. I'm from Coventry. And you've already got a business? It's a family business, which is operating in Russian fabrics. Now, just to expand our business and see other opportunities, So I've come here today to see and meet direct suppliers. Anything catch your eye? Maybe in the home appliances section? Well, definitely the bags, bagging, packaging.

2:34My name is Alvin, so I'm here to explore this event, especially around from an education and training perspective. I managed to find out about this event through Enterprise Nation. One thing that I really found useful was understanding more about the kind of end-to-end process, whether it be B2B, B2C, understanding the whole process of supply chain, and also more importantly, where to find the product, where to source it, how to vet the suppliers in different countries, how do you trust, obviously, the trust process as well.

3:07I'm Dougal Shaw and this is the Business Leader Podcast, where we look at the stories and strategies behind modern businesses. Today I've come to the CoCreate event in London run by Alibaba.com to meet the president of Alibaba.com. I found him on the second floor in a private room, away from the hustle and bustle of the busy event floor. He's been president since 2017 and joined the Alibaba Group in 2011. Before that, he worked at Microsoft and IBM. I wanted to hear from Kuo Zhang about the opportunities for UK SMEs that his platform offers and also find out how AI is changing the way entrepreneurs can tap into global supply chains.

3:49So what kind of people come to the event? What's the point of it? So it's all about the entrepreneurship and all the entrepreneurs from Europe who is interested in leveraging the global supply chain and also sell globally will participate, including the retailers, brand owners, social influencers, and other SMEs, entrepreneurs, you can think of that. And also we bring a lot of suppliers all over the world as well, like suppliers from Vietnam, from China, and also from Europe. So Co-Create event is one of our flagship event. We already hold three times in the US and this is the first time in Europe.

4:40We want to kind of expand this event to be a global event. And I've seen in the hotel lobby here where you are, lots of Chinese people have come over. Are they mainly people who work on the supply side, who are kind of wholesalers who create products, or who's come here from China? I think maybe part of from olive oil.com. So we have a lot of colleagues here as well.

5:05In CoCreator, we have three parts. The one part is to tell who we are, what we plan to do, what's next, and how we can help them. And the people from alibot.com, including the people who are working for search, working for payment, for logistics, I think they will be in the venue to help our customers, especially the buyers on topalip.com to better understand us. And also some of the suppliers from China will come as well. Since all, I think Europe, including UK, actually is one of the top priority marketplace. And a lot of suppliers want to build connections here as well. I think I've seen even Maersk is here, the shipping people.

5:59So why are they at this event? Okay. So you can see Visa, Master, JP Morgan, they are all kind of fulfilled for the payment part, the transaction payment part. And the Maersk, DHL, FedEx, all these are kind of working for the logistic part. So in the end, Alibor.com is a B2B commerce platform. So it enables both supply and demand side, and also it enables the fulfillment. So we want to build a platform that helps SMBs to fulfill from end to end to do global trading. So imagine you're an SME in Britain and you haven't thought of using Alibaba.com before. Give me some easy to understand examples.

6:44Who might find it useful? Okay. So we provide about three things. The first one is about global supply. So whatever on top of your mind, either is a finished good, or you just want to find a partner who can help you to manufacture your products, you can come to aliball.com to find the best supplies. And the second is the end-to-end supply chain. So when you find a product and you want to pay and you want to receive the goods, I think one thing on top of your mind is about trust. So I need to pay like tens of thousands of pounds to a people outside the UK and a stranger. So how can you trust them?

7:37The platform will protect you by trade assurance. It's kind of an extra payment, B2B payment system to protect the buyers and the sellers. And also we integrate all kind of logistics from the air freight to the sea freight to the Air Express to kind of deliver the product from all over the world to Europe. And last but not least is about all the AI tools we help SMEs. So we help SMEs in two ways. The first part is what should I sell? So you want to find what the next big idea And using the tools we provided to you, you can just generally describe which category or which country you want to go to.

8:25And we can give you a full market research report, helping you to understand the competitive landscape and what's the next big thing. And what are the kind of existing product and the flow is and how you can improve that. So that is one part. The second part is who can make this? So think about you make up your mind, you have your idea, a spec. Then you need to find the best suppliers in the world. So traditional e-commerce platform cannot help you to do that because it's a very rich dimension kind of a request. It asks not only for the product title pricing and also the capability of the manufacturers the certificates, and even do many more market research.

9:18So only the AI-enabled sourcing engine can help you to find the best match. And all of that costs you probably months or weeks of work. Now using AI, you can leverage it and fulfill it in minutes. One of the things that I was surprised about also is a new kind of software that they use, which is called ASIO, probably I'm pronouncing it incorrectly, which is the use of artificial intelligence to understand and gather more insights about market research, the supplier, and more towards how it can help the founder or the business or the company to smoothen their processes in order to set themselves up better.

10:01If you're a smaller SME in Britain, you might think, oh, a global supplier, that's kind of beyond me. And maybe they're worried that if the products are coming from China or, say, India or Pakistan, it's far away. So is that a worry for SMEs? And what do you think of that? Okay. Well, first of all, on alibaba.com yearly basis, there are already more than 50 million SMEs is working on this platform to search for global supplies. And they're working with global supplies, leverage the global supply chain. And in Europe only, this year, the order increase ratio is about 57%. So more and more people are using this technology, leveraging the global supply chain to level the play field.

10:53Previously, it was only the giants, the big guys, who can leverage the global supply chains. Now, with the help of Internet technology, with the help of AI, actually is just that you can use your phone at home to reach out to the most profound and sufficient suppliers over the world. I did a simple search on alibaba.com. Imagine I owned a small chain of hotels and I needed lots of cutlery, knives and forks for my hotels. So I looked and yep, there's lots of maybe 50 different businesses offering that, different prices, some gold cutlery, some silver, chrome. Let's assume it's a very good price you get on the platform?

11:32Is it going to take longer to arrive because it's further away? And what kind of visibility does the customer have over the kind of arrival times? Okay. You can select, like, if this is a finished goods, so let's say it's already in stock. So we provide all different kind of supplies. So one is in stock in Europe. So if that inventory is already in UK, just take probably within one week you can get that product. And if it is in China, in stock product, we have a delivery within seven working days, so to Europe as well. But if it's a custom product, for example, you want to print your restaurant's logo or do whatever stuff, then there's a kind of manufacturing date and also the delivery date.

12:21That depends on you want to do by sea or by air. Actually, we provided all different kind of delivery solutions.

12:34Alibaba Group has its own AI development. Do I call it Quen3? Quen, yeah. Which obviously is a rival to OpenAI. Presumably, you work with them to develop your AI offer, which you now have on the platform. First of all, the most model that we use is Tianwen Quen3. and also we are leveraging the older SOTA model all over the world as well. So you know in the arena of the big model, so each model probably can stay on the top for two or three weeks and it's changing very fast. Since we are building applications, we're just leveraging all the kind of RLMs, the best, which kind of category they serve up from the best.

13:18We just choose which model. So give me an example of the kind of things you can do on the platform now. thanks to AI. Okay, so let's start from the AI mode we are going to provide today. So imagine how you do the search for e-commerce before. So we divided the commerce into two parts. One is a short decision commerce, the other is a long decision commerce. Short decision commerce is just like if you want to buy a glass or you want to buy a kind of merchant groceries, trousers, dress, and you only consider about four or five dimensions from the pictures to the price to the titles to the inventories or the volumes and delivery date, something like that.

14:11And you make the decision very fast since the product is not so expensive. Well, when you switch to the long decision commerce, especially in the B2B part, first of all, each of our orders is about 2 to 3 thousand pounds. So it's a lot of money. So it's a more expensive decision. And the second, when it comes to B2B, you're going to sourcing a glass. It's completely different from you want to buy a glass for yourself. If you are sourcing a mountain bag, it's completely different from you want to buy a bag for yourself. So you consider probably more than 12 to 20 dimensions to make the final decisions.

14:53So the traditional kind of commerce will not help on that. So when you search like in Amazon or in Google, it will give you tens of thousands of lists. And you need to connect to each and every area of that supplier to confirm about the details which is missing in the product page. With the help of AI, we can first gather all your information. Maybe in your descriptions or in your file, your RFQ, we understand and we interpret that to take a plan. What are the actions we are going to take? And you can confirm. And then it will execute a point on that plan to gather information either from the product page or from the customer's manufactory's own private database or from the internet.

15:48And gather that dimension of 20 different columns and fulfill it for you. And then finally, it's kind of a human to choose which one I want to continue to discuss or negotiate with. And then come to the other side. So we are going to launch a new kind of agentic pay model in Alibaba.com as well. So when the buyer and suppliers, when you negotiate during the conversation for all the details, we will help you to generate the smart contract between you, the buyer and the supplier. and then it includes all the kind of PI information, the payment terms, the inco terms, and then you can just follow that order.

16:32The platform will protect you from end to end. So from the sourcing part to the fulfillment part, the AI can tremendously help you to save the time. If you have an idea for a new kind of product, let's go back to our example of the hotel. Say you've designed a piece of wooden furniture or a piece of metal furniture, and you've got, you sketch it out, you've got a design for it. Can you upload it to the AI system and it will help you find a manufacturer who might be able to make that for you? We provide two kinds of services. One is called a multi-model search. So it actually is an AI-based search.

17:08You can use it today. So using alibaba.com, upload your pictures, files, or your sketch, and it will search for you to find a similar product or recommend you to a list of manufacturers who can produce this. The second part is that, you know we launched a standalone application called Axio. So you can download it and try it today. So you can either upload your short sketch picture or you just describe what you're going to use, what you're going to source or what you're going to create. It will generate pictures, the specs, the marketing research report for you, so you can make up your decision what you want to choose.

17:54So either you can create your own product or you can search a similar one or existing ones on ibar.com. It's both works today. In terms of being an SME and deciding you want to get the cost benefits of a global supply chain, and you've had to look at the platform and you think this is a lot easier, One worry you might still have is about global tariffs, which is in the news a lot, and it's always changing. How does that affect your offer? So if you talk about like from China, US, so today, what we see is that the US order only increased about 30%. So there's still kind of great demand from SMEs to leveraging the internet to fund the global manufacturer.

18:37So it's happening. So back to the basics. The global trade, first principle is demand and supply. So you have your idea to solve a problem. You just want to find the best quality with the best price supply all over the world. Of course, you need to comply all the kind of the custom the tax, the regulations, the certificate. So that is a must for you to go to a certain market. But leveraging the global supply chain to help you actually, that is leveling the play field for the SMEs comparing with the large enterprise because everybody else is doing so. So privacy is only because of the technology, because you are lacking the expert to do that.

19:24So now we are trying to use technology, using agent to help the SME, the owners, to have this kind of capability. And the last question, you're here in London putting on a big show, trying to bring businesses together, stimulate SMEs. How do you find, as an international company, Britain is a place to be doing business? So you know we are not the first time to be here. So Alibaba.com is already for 26 years. and Europe and the UK is always our priority market. And what we see is several things. The first thing is that entrepreneurship everywhere we see similar. So entrepreneurship in Europe, when we see the SMEs, the buyers, I think you will see a lot today.

20:17They are aging from 15 probably to 60. and all have their dreams, have their drives, have their goals and want to leverage technology to fulfill their dreams. I think that is the same. And also we see more and more SMEs actually not only want to source globally, but also want to sell globally as well. So Alibor.com is a platform to help them both ways. You can find your best supply chain And also, you can leverage Alibaba.com to sell to U.S., sell to Europe, or sell to Asia. And we are not only the only platform. You know Aligroup. So we have Top 1 Timor. Every year, actually, we help Europe brand to sell 30 billion U.S.

21:15dollar worth product to China. So we are kind of a global by global sell platform. And more and more young entrepreneurs grow up. We see they are kind of more keen to embrace the internet technology. So nowadays on Alibaba.com, more than 80 % of the users is using mobile to do business. So they are kind of do the business during their taking exercises. at their kind of bedroom. So whenever that you have a great idea, you can use your phone to connect to the world. So that is how we see in US or in UK and Europe, how people do business. So we'll see, you're saying 15 year olds, we'll see young people who perhaps have a side hustle who are here to look for things that can be part of their business in their bedrooms.

22:07So talk about the 15 years old. I just met that guy downstairs. His name is Harrison Nutt. and he has already made about 200 ,000 pounds a year by just fulfilling his ideas. And since he started his business very young and also already leveraged the kind of world technology and the world supply chain to help fulfill his business. And we believe that we are going to see more and more. I'm Ilham, aka Leyal Moon, a French influencer and also an entrepreneur. So I'm here in this event. It was amazing. And what I liked the most was the mindset that they gave us because if we leave here, it will be amazing to see what the opportunities we have worldwide and with all the people around us.

23:04And as well as being an influencer, you also sell things as well. You're an entrepreneur. Yes, yes. I sell clothes on Vinted for the moment, but I would like to expand my products in bigger places.

23:25You've been listening to me, Dougal Shaw, speaking to Kuo Zhang, president of Alibaba.com for the Business Leader podcast. Please do rate and subscribe to us wherever you get your podcasts. We do two episodes every week. And if you head to our Business Leader website, you can sign up to our weekly newsletter, where you can find lots of content like this, as well as opportunities for your business.

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