China’s express delivery companies bring "Chinese speed" overseas

（Photo/Xinhua）

In China, customers can receive their purchases the next day after they place their orders, or even received on the same they placed their orders. The speed of China’s express delivery is envied by many foreign customers in the world. Thanks to the rapid development of e-commerce in the past decade, China has gradually established an efficient and convenient logistics system.

First of all, the domestic express delivery industry is becoming more and more mature. Statistics indicate that in 2018, China's express delivery volume exceeded the total volume of the United States, Japan and Europe combined, ranking first in the world for five consecutive years, more than three times that of the United States. It accounted for more than half of the global express package market, thereby becoming a driving force and stabilizer for the development of the global express package market.

Meanwhile, the domestic market is becoming increasingly saturated, which has become the driving force for domestic express delivery companies to expand the market.

Second, the rapid development of China's cross-border e-commerce is driving domestic express delivery companies to go abroad. According to the data, in 2014, China's cross-border e-commerce transaction scale was 4.2 trillion yuan, while in 2018, China's cross-border e-commerce transaction scale had reached 9 trillion yuan, with a growth rate of 114%. In 2018, China's cross-border express delivery business reached 1.11 billion pieces, up 34 percent year-on-year, outpacing the overall growth of the industry for two consecutive years.

Finally, China continues to release polices to promote express delivery to go out of China. The State Post Bureau has set up an aviation green channel in 13 cities where cross-border e-commerce pilot zones are located, including Hangzhou, Zhengzhou and Shanghai. It has cooperated with civil aviation and customs departments to simplify customs clearance procedures to improve the delivery time. The policy will help further promote the Chinese express delivery enterprises to "go out".

However, China's express delivery service system also faces many challenges. On the one hand, international express business is dominated by international express delivery giants such as FedEx, UPS and DHL. These giants have strong air transport capabilities and delivery networks in major countries and cities around the world. So, compared with the international industry giants, the level and ability of China’s express delivery enterprises in the sphere of international division of labor is still insufficient.

On the other hand, Chinese express delivery companies are also facing operational challenges. Furthermore, overseas labor costs are relatively higher, so the labor dividend in terminal distribution will disappear. At the same time, many overseas consumers have a relatively dispersed living style, some of them even live in remote suburbs. As a result, how to reduce the cost of the delivery process will also become a major issue.

Overall, China’s express delivery companies exploring overseas business development opportunities has provided both opportunities and challenges. Therefore, it is necessary for China’s express delivery companies to identify their positioning, make full use of their strengths, avoiding their weaknesses, while also joining join hands with Chinese cross-border e-commerce and production enterprises to set sail on the vast ocean of international express delivery markets.