The Great Change Of Private Express Delivery: How Does A "Rabbit" Set Off The Inner Volume Of Shunfeng'S Waist?

In 1993, a company named "SF express" appeared in Shunde, Guangdong Province. Wang Wei, the boss of the company, is a "parallel goods man" business between the mainland and Hong Kong.

In the same year, Nie Tengfei and Zhan Jisheng founded Shengtong Industrial Co., Ltd. in a rental house near shentangqiao, Hushu South Road, Hangzhou, Zhejiang Province. Shengtong industry later changed its name to Shentong express.

After nearly 30 years of development, the private express business developed by Wang Wei and Nie Tengfei is not what it used to be. Shunfeng is still Wang Wei's Shunfeng, and has become the most profitable private express company in China. Shentong has already changed its ownership (after Nie Tengfei died, his younger brother Nie Tengyun later founded Yunda shares). Farewell to the era of grassy growth, private express "fighting" in the river and lake is now more fierce, some leave the scene, some are evergreen, and some "newborn calves are not afraid of tigers".

Shunfeng's first quarter performance thunderbolt, opened the reality of fierce competition in the express industry. But this also has to let people reflect, what is the reason for the most profitable SF to fall behind in profits?

"As far as China's express industry is concerned, it used to make money by" luck ". Now it is about to enter a stage of complete competition." Zhao Xiaomin, deputy director of the postal express special committee of Shanghai Communications Commission, told the 21st century economic reporter that in the next two or three years, the express industry will have many stories, and the whole industry will enter an era of full integration of equity mergers and acquisitions.

However, some uneasy factors, but the current express industry competition back to the barbaric period. As a troublemaker in the field of e-commerce express delivery, the experienced "Tongda system" did not hesitate to respond and offered the strategy of "exchanging price for quantity". Shunfeng heavy assets into the price mire, a loss in the first quarter, the chairman apologized.

Throughout the development of China's private express industry, the competitive center of leading enterprises has maintained a forward trend - Shunfeng and Tongda system have coincidentally "told" stories about the transformation of integrated logistics service providers. Under this dimension, private express enterprises are building a moat in the direction of business diversification. When China's private express industry enters the era of great changes, what factors affect the process of the transformation of the express industry?

A significant performance of the development of China's private express industry is that express enterprises are not willing to only deliver express delivery. -Xinhua News Agency

Express enterprises are not willing to only deliver express delivery

A significant performance of the development of China's private express industry is that express enterprises are not willing to only deliver express delivery.

Although there is a distinction between direct operation and franchise in business model, SF, Jingdong and Tongda are moving towards the transformation of integrated logistics service providers.

This is a very imaginative story. Lighthouse enterprises have appeared in the international logistics market. FedEx and UPS, which are competing for duopoly, set up the whole chain of express delivery, LCL, supply chain, e-commerce and commercial service, so that the two giant enterprises can enjoy the steady increase of profits brought by the integrated logistics mode. Therefore, for domestic express enterprises, from a single to multiple development path is inevitable, the rest is just a matter of time.

"Logistics service integration is not only driven by the diversification of customer demand, but also the result of internal development of express enterprises." A courier company told the 21st century economic reporter.

In the past decade, the rapid development of e-commerce has provided fertile soil for the wild growth of private express. "Tongda system" stands out in the competition by means of franchise system and "price war", but homogeneous competition and low profit have become the lingering labels of express industry. In contrast, SF, which is positioned as medium and high-end time effective parts, shows differences in service and product positioning, and shows high bargaining power. For a while, SF also became the most profitable company in the field of private express delivery.

The further development of the industry is inseparable from the push of capital.

At the end of 2015, Shentong took the lead in closing to the capital market and launched the domestic "express first share" competition. Although it was overtaken by the round corner, the collective listing of "Tongda system" shows that the development of express delivery industry with capital intervention is irreversible.

In the face of this trend, the so-called "will not be listed" Wang Wei bowed his head in front of the capital. So far, Wang Wei has "often asked himself:" should SF not be listed? Because it seems more and more far away from my ideal. "

It is undeniable that capital intervention accelerates the endogenous fission of private express enterprises. Under the stimulation of the capital market always expecting new stories, Tongda, Shunfeng and Jingdong show their determination to locate integrated logistics service providers.

The so-called integrated logistics service provider is to create an ecosystem with express delivery as the core. Looking at the past annual reports of Shunfeng and Tongda system, we can find that the future development goals are the same in terms of Shentong's "product ecological construction", Yuantong's "express +", Yunda's "one body and two wings", Zhongtong's ecological circle construction, as well as the differentiation competition of SF, or the continuous modification and update of their own strategic wording by various enterprises, what are your goals Almost the same.

This change is accompanied by the change of supply chain gene driven by consumption upgrading and retail reform. In such an environment, manufacturing enterprises, suppliers and retailers at all levels need to quickly respond to consumer demand, and it is urgent to upgrade the supply chain. At the same time, each link of the supply chain puts forward higher requirements for the efficiency, experience and cost control of logistics services. Therefore, it is an inevitable direction for logistics to be deeply embedded in all aspects of the supply chain, and express logistics enterprises need to respond to this change quickly.

When the dividend of e-commerce gradually weakened, this formed the long-term growth logic of express enterprises.

"The logistics industry revolution brought about by digital intelligence technology is already taking place." Logistics industry expert Yang Daqing told the 21st century economic reporter.

Ecological construction, in the private express enterprise internal continuous fermentation. If necessary, the chief executive needs to leave in person.

On May 28, 2020, Lai Meisong, chairman of China express, appeared in front of the live camera. In this live broadcast, Zhongtong moved the site to Zhongtong cloud warehouse warehouse to strengthen the exploration from logistics to business flow. "Zhongtong is not only a express company, but also a technology company, but a platform company and an ecological company." Lai Meisong commented on the media.

The integrated logistics track is not crowded, but the "Tongda system" of the same origin has experienced a race differentiation on the track of the integrated logistics service provider, and Zhongtong takes the lead in "going out of the circle".

Four months after Lai Meisong's live broadcast debut, China Telecom ushered in its second listing in Hong Kong. On the eve of its listing, ZTC held an open day for customers, including Zhongtong express, Zhongtong express, Zhongtong yuncang technology, Zhongtong commerce, Zhongtong international, Star Airlines alliance, etc., all of the business segments of the group's ecosystem appeared, and the ecosystem has taken shape.

In the process of endogenous fission, the cooperation of business development becomes a key factor. This is reflected incisively and vividly in the competition of express transportation.

In the search for a new growth pole other than express delivery, express has become the first field of SF and Tongda. However, after several years of competition, only Shunfeng, Zhongtong and Baishi have emerged from the express business. Shentong and Yunda failed successively.

"Express companies are accelerating into the second stage of all-round competition mode, from corporate governance, team structure, capital reserves, to solutions, industry integration, and Industry Alliance." Zhao Xiaomin believes that the next round will be a higher-level "war".

A rabbit starts to curl up

In the high-level "war", SF is indeed at the forefront and drives the evolution of the competition mode of private express enterprises.

"The company spared no effort to develop new business such as economy, express, cold chain, intra city, international, supply chain, etc., and successfully transformed from a single express enterprise to a comprehensive logistics group, with a growing customer base and more penetration into the supply chain." In the face of doubts from investors, SF holdings adheres to long-term vision.

21st century economic reporter noticed that when SF holdings had a bad quarter loss, analysts gave a "tolerant" attitude. "Although the short-term performance is under pressure, it will gradually usher in capacity utilization rate climbing and management improvement." This speech of Anson securities transportation analysis team represents the view of most analysts.

However, when the most profitable private express enterprises have fallen behind in profitability, the irrational competition in the express industry seems to be dragging down the pace of the industry's progress, which also makes the private express enterprises enter the competition entrapment trap when they stride into the future format.

In 2020, a "rabbit" will stir up the private express business in the post epidemic era.

In March last year, rabbit entered the express market in China and expanded its team in China to 150000 people in only one year. According to the latest data, as of January this year, the average daily delivery volume of polar rabbits was 20 million pieces. For other express companies, it took 5-10 years to complete the data.

In the capital market, the extreme rabbit is also in the limelight. Recently, some media reports said that polar rabbit has completed a $1.8 billion financing, with a post investment valuation of $7.8 billion.

Due to the "double harvest" of business volume and financing channels, private express enterprises have to face up to the existence of the pole rabbit. As early as July last year, when the polar rabbit showed signs, the "Tongda system" once reported that it would ban the wild invasion of the polar rabbit. But under the influence of "price war", the ban failed.

At present, the development model of polar rabbit is the same as that of Tongda system in the early years. In the current situation that it is difficult to change the homogenization competition of e-commerce express, the "price war" can easily shake the pattern of e-commerce.

"Price war" is the most easy means of competition to achieve its goal when the market is in disorder. " Yang Daqing told the 21st century economic reporter that the current price war in China's express delivery market is caused by many factors: first, the express market itself has not established an intensive market, and the "price war" is directly effective in the case of market competition; second, new market entities such as Jitu and some traditional express enterprises expand the market with new models, and are more willing to win the market quickly with "price war" Third, digital technology is changing the market pattern of traditional enterprises. During the digital lane changing period, the existing pattern will be gradually loosened, and the enterprises who intend to gain the upper position are willing to break through the "price war".

The above-mentioned express enterprise personage jokingly said to the economic report of the 21st century that "fighting with the pole rabbit" seems to be fighting with another past self

Obviously, "price war" is making the competition of private express continue to ferment. Under the "catfish effect", Shunfeng and Tongda system seem to be unable to leave in time.

Why does SF bow down?

"Due to the low average market price of waist e-commerce parts and the need to reach a certain scale in order to have obvious benefits, the short-term profit of the company will be under certain pressure." In response to losses, SF explained.

So, why does SF insist on entering the field of e-commerce parts? The deep reason is that the decisive relationship between business flow and logistics has been strengthened again due to the evolution of e-commerce competition pattern.

"The sinking new market space has been excavated, and the rise of live e-commerce platforms such as pinduoduo and Kuaishou has opened up a new incremental space for e-commerce products." Yang Daqing believes that the manufacturing market and e-commerce market are the survival soil for express enterprises, and it is difficult for express enterprises without large-scale order support to survive.

In the past decade, the price war triggered by "Tongda system" has become a hot topic, and SF's e-commerce products have failed under the pressure of cost. However, with the growth of time sensitive parts business, it is difficult for new businesses such as express and cold chain to enter the profit release period quickly. SF has to rethink the possibility of e-commerce business.

With the first mover advantage in network operation during the epidemic last year, SF seized a lot of market share of e-commerce products from "Tongda system", which brought about rapid growth of business volume. But soon, the bottleneck of production capacity appeared, the capital expenditure increased, the cost increased rapidly, and SF once again fell into the quagmire of "price war".

What needs to be vigilant is that the "price war" may be on the rise. Recently, Yiwu, known as the weathervane of China's express industry, has reproduced the express price of 0.8 yuan per ticket.

"Homogenization and uneven distribution of express quantity and pieces are the essential reasons for the endless price war of e-commerce express delivery." Some institutional analysts who did not want to be named told the 21st century economic report that last year only Yiwu's express market share accounted for more than 10% of the country. Under the "siphon effect", the "price war" is often easy to spread to the whole network.