eCargo secures distribution contract with Nestlé

SYDNEY--(BUSINESS WIRE)--eCargo Holdings Limited (ASX: ECG) (ECG, eCargo or the Group), a supply chain solutions provider helping brands expand and sell more in the Asia market, today announced that it has been appointed as Nestlé's cross-border master distributor for China for its Coffee and Dairy range.

Under the agreement, eCargo will help Nestlé to sell its coffee and dairy products, which includes Nestlé Gold, Starbucks coffee and Milo, in Mainland China through cross-border channels, providing supply chain, distribution, eCommerce and digital marketing solutions.

The cross-border trade management is facilitated by Flow, eCargo’s proprietary platform providing B2B supply chain solutions including buyer-supplier management, international logistics, and credit management.

China’s Lucrative Coffee Market

China’s coffee market is a multi-billion dollar industry, which is expected to grow at a CAGR of 10.4% over the next 5 years¹.

Despite disruptions posed by COVID-19, Nestlé’s coffee in the Greater China region saw sales growth in 2022, primarily driven by Nescafé soluble and ready-to-drink coffee, as well as Starbucks products².

In the first quarter of 2022, Nestlé accounted for the largest share of China’s online coffee product sales and generated around 10% of the total coffee beans, powder, and instant coffee sales on Alibaba’s eCommerce platforms³.

eCargo Chief Executive Officer Lawrence Lun commented, “We are delighted to work with Nestlé, one of the largest and longest-standing companies in the world, to manage and broaden its customer base in China by leveraging our supply chain platform, Flow. The opportunity to partner with Nestlé is further validation of our capability to fulfill our mission to help brands sell more.

“Chinese consumers in tier 1 and 2 cities are already habitual coffee consumers, but the surging popularity of coffee culture in tier 3 and 4 cities means there is significant room for further growth and expansion.”

Nestlé Head of Omni Strategy and F&B Cross Border eCommerce Daniel Wong commented, “We are excited to have eCargo on-board to support the future growth of our Dairy and Coffee cross-border business.

“eCargo brings a wealth of experience in both logistic and commercial areas to help optimise our supply chain costs as well as identify growth opportunities in the dynamic China market.

We are looking forward to delivering double digit growth together with eCargo.”

About eCargo Holdings Limited

eCargo Holdings Limited is an ASX-listed supply chain solutions provider helping brands expand and sell more in the Asia market, with a specific focus on China. eCargo’s one stop service covers logistics, eCommerce, Online to Offline distribution and B2B supply chain solutions. Trusted by brands across different categories, eCargo builds an agile, digitalised, and integrated supply chain infrastructure to drive operational efficiency for brands to deliver omnichannel growth in new markets.

¹ https://www.mordorintelligence.com/industry-reports/china-coffee-market
² https://www.nestle.com/media/pressreleases/allpressreleases/full-year-results-2022
³ https://www.statista.com/statistics/1305707/china-online-market-share-of-leading-coffee-product-brands/#:~:text=In%20the%20first%20quarter%20of,commerce%20platforms%20were%20from%20Nestl%C3%A9.