Momo.com Inc (富邦媒體) opened its southern distribution center in Tainan’s Sinshih District (新市) yesterday, as the e-commerce operator continues to strengthen its logistics infrastructure, aiming to further differentiate its service not only from online competition, but also brick-and-mortar retailers.
Construction of the southern distribution center on a site covering 24,500 ping (80,972.5m2) started in 2021.
The company plans to build six floors above ground and one below, investing about NT$3 billion (US$92.3 million) in the center, Momo.com said in a statement.
Photo courtesy of Momo.com Inc
The new distribution center has the capacity to process 160,000 packages per day and could store as many as 3.4 million packages, the company said, expecting it to help shorten the lead time for packages delivered in Yunlin County, Chiayi County, Tainan, Kaohsiung and Pingtung County.
Apart from ensuring quality, speedy service for consumers in southern Taiwan, the new distribution center is expected to help achieve fair distribution of delivery tasks between northern and southern Taiwan and reduce distribution costs, while lowering energy consumption for transportation and cutting carbon emissions in the region, the company said.
In addition, the new center is expected to assist the development of local industries, as well as create 500 job opportunities in logistics, data analysis, research and development, and warehouse system in the region, it said.
Momo.com, which operates three platforms — online shopping, TV home shopping and catalog shopping — enjoys a steady share of 16.5 percent of Taiwan’s online retailing market, according to a Fubon Securities Investment Services Co (富邦投顧) estimate.
“With the launch of the southern distribution center, Momo’s warehouse area is estimated to have increased by 15 percent compared with the same period last year. The company’s market share is expected to increase through better logistics services, which will also strengthen its competitiveness,” Fubon Securities said in a statement on Nov. 5.
Momo.com early this month reported its third-quarter revenue hit a record NT$25.55 billion, up 1.9 percent year-on-year, thanks to its greater logistics efficiency and a wider range of product offerings compared with local peers.
However, lower consumer purchases, rising market competition and higher operating expenses earmarked for new businesses affected the company’s bottom-line, with net profit falling 11.2 percent to NT$666 million and earnings per share (EPS) dropping 11.1 percent to NT$2.64, lower than consensus estimates of NT$788 million in net profit and NT$3.27 for EPS, according to data compiled by Bloomberg.
Gross margin decreased 0.34 percentage points to 8.92 percent and operating margin fell 0.42 percentage points to 3.22 percent from a year earlier, company data showed.
Overall, Momo.com’s cumulative revenue in the first three quarters of this year hit a record NT$76.41 billion, up 3.5 percent annually, but net profit over the period fell 5.6 percent to NT$2.34 billion and EPS declined to NT$9.29 from NT$11.04, data showed.
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