"Ocean Express" Layout Cautious Domestic Express Market "Lifting The Ban"

The Chinese government finally decided to fully open domestic parcels. express The market. For the Shanshan market, the long-awaited international courier has been hesitant. An executive from a foreign express company told reporters after the opening of the news that there was "a sense of flattering surprise", but he was cautious about whether he was ready to enter the market. "High (low cost) and low income", "if the preparation is not good, it will be troubled."

According to the reporter, this is not the "trouble" of a foreign express giant. DHL (German DHL), FedEx (FedEx), UPS (United Parcel) and TNT (Holland world) four international express giants, whose main business is concentrated in international express delivery. In the domestic express delivery market, only UPS and FedEx have business, compared with the local express industry, Shun Feng and "four links and one access", the share is limited.

The express industry has been called "a dark horse of China's economy" by Premier Li Keqiang. After the full liberalization of the Chinese express market, will the "foreign express" will exert great force and challenge the local enterprises? At present, the attitude of the foreign giants is not clear.

Let go of the ban.

The express industry was called "China" by Premier Li Keqiang. Economics In the past year, Li Keqiang has inspected courier companies and visited express workers many times. A few days ago, Li Keqiang chaired a State Council executive meeting, decided to fully open the domestic parcel express market, and issued the business license to foreign express enterprises that meet the licensing conditions according to approved business scope and business area. At the same time, it will further simplify operation permit procedures and other aspects, promote linkage development between express delivery and e-commerce and manufacturing, encourage mergers and acquisitions of express enterprises, and improve and implement the system of reorganization and filing, foreign capital merger and acquisition examination.

This is undoubtedly a good news for foreign express which is constrained by the "ban" for many years. An executive from a foreign express company told reporters after the opening of the news that there was "a sense of flattering surprise". "Before we need approval, we need a licence, and now we do not need any approval, so we can record in any place and do the domestic express business directly."

FedEx also welcomed the news for the first time. In an email to reporters, the State Council's decision to further open the domestic express delivery market will create an equal business environment for Chinese and foreign express enterprises.

At present, the international express The giants are mainly DHL (German DHL), FedEx (FedEx), UPS (United Parcel) and TNT (Holland world) four. Basically, the four major international express companies entered the Chinese market in the 80s of last century. However, the restrictions on policies were conducted in the form of joint ventures, mainly in joint ventures with Sinotrans. Through the Sino foreign joint venture, the four express giants opened the market of China International Express.

After China's accession to the WTO, China's international express business is basically open to foreign investment, and the domestic express business in major cities has also been partially opened to some foreign-funded enterprises. At that time, the express business was under the jurisdiction of the Ministry of Commerce and was relatively loose. The Ministry of Commerce had no restrictions on the operation of foreign-funded companies. Apart from the joint venture between DHL and Sino foreign joint ventures, the other three major express companies began to invest exclusively in the Chinese cloth business in the later stage, and adopted the mode of acquiring domestic enterprises and using the existing network to help develop. Among them, TNT acquired Tianhua Huayu, FedEx acquired Datian, 50% of FedEx limited, and three domestic express companies such as DHL's acquisition of Shanghai express.

But with the process of separation of government and enterprises in China's postal service and the introduction of the new China Postal Law in October 2009, the operation restrictions on foreign-funded enterprises' domestic letter business have been increased in the clauses, and the courier companies are required to apply for the operation license to the post office again.

This has also led to the fact that many international express giants who have been operating for many years have been caught in the embarrassment of "unlicensed business". Due to the lack of domestic express business license, several foreign express giants have slowed down the development of China's domestic express business in varying degrees. Until September 2012, FedEx and UPS got the domestic express license, got the permission to carry out domestic express business in some second tier cities, while DHL obtained the right to operate the domestic express market through joint ventures with Sinotrans.

　　 "Troubled" market

"In 2013, China's express delivery enterprises completed 9 billion 200 million business volumes, and the market scale increased to second in the world, with a year-on-year growth rate of 61.6% and an average growth rate of 43.5% for five consecutive years." He Liming, President of China Federation of logistics and purchasing, has revealed that the main reason for supporting this growth is e-commerce.

Statistics show that China's express industry is at a stage of rapid development, with an average growth rate of over 50%. According to the data provided by China National Post Office, the volume of business of the national express delivery service enterprises totaled 9 billion 390 million in the first three quarters of 2014, an increase of 52% over the same period last year, and business income totaled 140 billion 990 million yuan, an increase of 41.6% over the same period last year. As of October 20th, this year, the national express delivery service enterprise has accumulated 10 billion business volume.

In the face of such a huge domestic express market, compared with the later local businesses, Shun Feng and "four links and one access", the "foreign express" who first entered the market failed to get the first mover advantage. The report of the national development and Reform Commission and the Ministry of Commerce on the impact of foreign investment on China's logistics industry and its policy recommendations shows that although the four giants currently occupy 75% of China's international express delivery market, the share of the domestic express delivery market is less than 1%.

The research report released by DDT accounting firm and China Post Office Research Center said that China's private sector is still the main force in the domestic express market, with a market share of 78.9%. By contrast, the share of foreign companies is only 1.2%.

After the news of releasing the express industry in September 24th, express industry people expressed concern about this. "A new round of mergers and acquisitions has begun." It reminds us that on the one hand, the domestic express market is fully open to foreign investment, on the other hand, it encourages the merger and reorganization of express enterprises and the examination of foreign capital mergers and acquisitions.

"Foreign-funded enterprises have a sound business model and technology, and policies will trigger the reshuffle of the domestic express industry, breaking the" unified city "situation of domestic express companies, especially the demand for high-end express delivery of SF and EMS, and it will probably be diverted by FedEx and UPS. At present, China's domestic express delivery market, high-end business pieces are basically dominated by EMS and Shun Feng monopoly, and Taobao express is the world of "four links and one access".

FedEx told reporters in reply: "at present, the electricity supplier logistics market is undergoing differentiated market diversion. FedEx's precise, fast, professional and reliable service experience enables us to gain favor and exert greater energy in the high-end segment market. In addition, there are also technological innovations, such as FedEx's use of online sending tools and upgrading of various innovative services.

However, from the reporter's understanding, foreign giants are hesitant about whether to open up the Chinese express market in a big way. The executives of foreign express companies expressed cautious attitude that the market "high cost and low income", "if the preparation is not good, it will be troubled." FedEx also cautioned that "domestic business will continue to operate normally".

Similarly, the reply from DHL express to reporters also indicated that the future strategic emphasis will be placed on the international express delivery market (China Import and export express business), which does not exclude the possibility of developing B2C business in China in the future.

Xu Yong, chief consultant of China Express consultancy network, said that the legal level of opening up is even more significant and will not cause a large influx of foreign express. At present, the domestic express delivery market is not mature, and is still in the "price war" stage. Foreign express will not force domestic express business in a short time. "The main body of market competition tends to be diversified, and the entry of foreign capital, private sector, state power, electricity supplier and other industrial capital is a sign of market maturity, and the future express market will be further broken down."

Zhong Tong express vice president Jin Renqun also told the media that as a private courier company, China Unicom welcomed the foreign express. In its view, at present, "three links and one Da" dominate the main electricity supplier market in China, which is obviously different from the "four big" international express delivery enterprises.