China possibly largest market for express deliveries
January 31, 2013 Category Express delivery, Logistics
Last year saw 5.7 billion packages delivered through express services in China, prompting analysts to speculate over whether the country has surpassed Japan to become the world’s second-largest market for express deliveries. Ma Junsheng, Director General of the State Post Bureau of China, said that China’s postal industry made significant strides in 2012, with the domestic express industry earning CNY106 billion in revenue last year, a year-on-year increase of 40%. The number of packages delivered in 2012 was up 55% from the previous year, Ma said, and he expects the figure to increase by 40% this year, hitting 8 billion. Xu Yong, Chief Consultant with the express and logistics website www.cecss.com, said China has already emerged as the world’s second-biggest market for express deliveries. The website estimates Japan saw about 5.5 billion package deliveries in 2012, and the United States 7.5 billion. “But China’s express market is still in its initial stage of development,” Xu said. “Compared with developed economies, China lags behind in the diversity and quality of its services.” The express delivery market is expanding thanks to e-commerce. A report from the Boston Consulting Group has suggested that China is likely to surpass the United States to become the world’s biggest online retail market in 2015, a year in which the country’s online retail sales are expected to be worth more than USD360 billion. But the surge in e-commerce transactions has resulted in difficulties for Chinese courier companies. Da Wa, Secretary General of the China Express Service Association, said domestic demand for express services will far exceed the supply for at least the next five years. The combined number of packages ordered on peak days from Tmall.com and Taobao.com could even “exceed the total number of packages that Chinese courier firms can handle in a single day”, according to Daniel Zhang, President of Tmall.com. “The revenue from the domestic express industry is expected to triple in 10 years by 2020,” Ma of the State Post Bureau said, as reported by the China Daily.
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