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Symposium Discusses Logistics
The central government wants Chinese companies to increase profits by improving management and efficiency in the purchase, transportation, storage and delivery of materials and products, said a senior official of the State Economic and Trade Commission (SETC) on June 5.
"Logistics are expected to become a new source of profits for Chinese firms," Ma Liqiang, vice-director of the SETC Economic Operation Bureau, told an international symposium on modern logistics that opened in Beijing Monday.
Logistics is a term used to describe the process by which a product gets from the manufacturer to the consumer, including transportation, storage and distribution.
Organized by the China Association of Warehouses and Storage and the Commercial Development Center of the State Administration of Internal Trade, the symposium will run from Monday to Wednesday.
Some 400 representatives from the manufacturing, transportation, distribution and information technology sectors attended the meeting.
Companies that improve their logistic management usually see profits rise, Ma said.
He cited as examples Qingdao Beer Group and Haier Group in East China's Shandong Province.
After reforming its logistic system, Qingdao Beer has been able to save about 32 million yuan (US$3.9 million) a year, he said.
But participants at the symposium admitted that most Chinese companies, State-owned enterprises, are bogged down by badly managed and inefficient logistics, which drive up costs.
China's logistics industry has not kept pace with the country's rapid economic development and shift to a market economy, said Wang Wei, senior researcher with the Development Research Centre of the State Council.
She called for quick development of the industry to improve the quality and structure of the national economy.
Otherwise, China will not be able to meet demands of growing international trade and globalization expected to greatly affect the country when it joins the World Trade Organization later this year.
Logistic expenditures on raw material supply account for about 5.4 per cent of industrial enterprises' purchasing cost, according to a China Association of Warehouses and Storage report.
Expenditures on purchasing, transporting, storing and delivering products makes up 7.74 per cent of industrial enterprises' sales volume, said the report.
Commercial enterprises also spend about 1.96 per cent of their sales volume on logistics, the investigation shows.
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