February 16, 2018 / 4:51 AM / 4 months ago

E-commerce firm Mercado Libre to open distribution centers in Mexico

MEXICO CITY (Reuters) - Mercado Libre, Latin America’s home-grown e-commerce firm, said on Thursday that it would open two large distribution centers in Mexico as part of an effort to improve its logistics in the country.

FILE PHOTO: Employees work at headquarters MercadoLibre (Online marketplace company) in Sao Paulo, Brazil, July 10, 2017. REUTERS/Nacho Doce

Buenos Aires-based Mercado Libre said it would invest $100 million to open the distribution centers, the company’s first, which would yield 3,000 jobs in Mexico.

The facilities will help the company speed up deliveries, which is essential to the appeal of e-commerce, Chief Executive Ignacio Caride said in an interview earlier this month with Reuters.

“As fast as possible - that is going to be the experience of e-commerce,” he said. “That is the big difference between people who go to retail stores with packages in their arms, and people who shop online - how long it takes.”

The distribution centers, which total 1.4 million square feet (130,000 square meters), are located in the state of Mexico, which surrounds Mexico City.

Mexico’s nascent e-commerce market is heating up, with Amazon.com Inc also investing heavily.

Logistics is the most vexing challenge facing e-commerce companies, Caride said.

“That is the most difficult part to solve, because it’s very expensive, and it requires lots of people, and it requires a very big investment,” he said.

Reporting by Daina Beth Solomon; writing by Julia Love; Editing by Amrutha Gayathri

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