This article is from WeChat official account:Passagegroup (ID:passagegroup), author: Xie Xiaodan, the original title: “SF” sailing “to Southeast Asia”, the title figure comes from: vision China

One year ago, SF Express, which has always been low-key, changed its previous posture and launched heavy moves one after another.

In Myanmar, SF Express strategically invested in local logistics company KOSPA Limited and invested US$4 million to acquire 25% of the latter’s shares; in Indonesia that month, SF took a stake in the Indonesian Triputra Group and established a joint venture to target the Indonesian e-commerce and express logistics market One month later, in Vietnam, SF Overseas, a wholly-owned subsidiary of SF Express, and AffluentWoods jointly invested to establish a new company, GS EXPRESS, to expand the Vietnamese logistics market.

The above news all point to a common area-Southeast Asia. From the outside, this series of actions is also a signal for SF Express to accelerate its deployment in Southeast Asia. SF Express was not absent when Chinese companies “shunshui” went overseas to Southeast Asia.

Internally, SF Express’s tactics to go overseas are summarized as “distant communication and close attack” and “combination of light and heavy”: In Southeast Asia and other near-end markets, it mainly establishes branches and self-operated outlets. In the remote market, it mainly cooperates with international giants and local express service companies to act as agents for each other and exchange markets.

And 2019 can be described as the highlight of SF Express going overseas, and Southeast Asia is the most concentrated area of ​​SF Express. At present, SF Express’s international business has successively covered Malaysia, Vietnam, Thailand, Cambodia, Indonesia and other countries.

Just as SF Express’s aggressive Southeast Asian enclosure, other giants were not idle. In 2018, Jack Ma, Chairman of the Alibaba Board of Directors, met with the legendary Malaysian Prime Minister Mahathir, and the two sides cooperated to build an eHub in Malaysia.

Ma Yun claimed that Cainiao does not compete with any logistics company, but builds a logistics network. However, in the past two years, Alibaba’s Best Logistics and Zhongtong Logistics have also successively entered Southeast Asia.

It’s hard to hide the many colors of Super Rabbit Express. It is locally known as J&T in Southeast Asia. After achieving great success in Indonesia, it decided to counterattack the “mainland”.

Gitutu Express’s birthplace is Southeast Asia / Sohu

1. Combination of light and heavy

SF’s layout in Southeast Asia can be traced back to 2010, when SF Express first set up business outlets in Singapore. A few days ago, SF Express staff in Singapore told Zhixiang.com that it currently has 5 outlets in Singapore and plans to increase it by 12 next year.

After that, SF Express began to explore other Southeastern markets. At the end of 2016, the Vietnam branch and the Ho Chi Minh branch were established. In April 2017, SF Express announced the establishment of the Thailand branch and the Bangkok branch. In the past few years, SF Express’s international business has successively covered Malaysia, Vietnam, Thailand, Cambodia, Indonesia and other countries.

2019 is a watershed. The establishment of branches in Singapore, Vietnam, and Thailand is based on a heavy asset layout. The investment in 2019 is an attempt by SF Express to move towards a lightweight layout in Southeast Asia.

In Myanmar, Vietnam and Indonesia, SF Express has invested modest funds to test the waters locally.

Zhao Xiaomin, an express logistics expert, analyzed on Zhixiang.com that the former SF Express used a comprehensive strategy to enter Southeast Asia. It used a set of combination punches, on the one hand, with local resources and on the other hand with local logistics companies. Joint ventures, alliances, and some self-employment. SF Express has outlets in Myanmar, Thailand, Malaysia, and Vietnam.

“Single model is too risky, and three models are carried out at the same time, which can increase market share and industry status, but also have good revenue, the success rate will be higher, and the scale benefits will also appear “Zhao Xiaomin believes that SF Express adopts a prudent strategy internationally, with more consideration of success rate.

“In addition, aviation is a very important advantage of SF Express. This year, SF Express has opened several new routes in Southeast Asia, and the results are currently relatively good.” Zhao Xiaomin said.

SF Airlines’ fleet size has increased to 60 aircraft / SF Express official website

Data shows that as of July 2020, SF Airlines’ fleet has grown to 60 aircraft. In the first half of this year alone, the total volume of SF Airlines’ all-cargo aircraft on international routes exceeded 40,000. In addition, in order to respond to the urgent demand for international air transportation of epidemic prevention materials and other cargo in the external market, SF International quickly opened 18 international all-cargo routes including China to the Americas, Europe, and South Asia and Southeast Asia.

Understandably, SF’s speed in Southeast Asia has begun to slow down. In early March, the cooperation between SF Express and Jinyuan Rice in Vietnam was also terminated. “It is quite normal to dissolve cooperation with Jinyuan Rice. In addition, due to the epidemic this year, many companies’ explorations were not as good as expected. Last year, SF Express’s deployment in Southeast Asia was much faster than this year.”

However, this is only a short-term phenomenon. “As far as we know, as the epidemic recovers, SF Express will continue to accelerate its internationalization.” Zhao Xiaomin revealed.

II. USD 10 billion has been invested

Strengthening the layout in Southeast Asia is an inevitable choice for SF Express. From the perspective of the industry, whether it is from the industrial side or the consumer side, Southeast Asia has a strong demand for express logistics.

Yang Qing, Director of the Logistics Management Teaching and Research Office of Guangxi Vocational and Technical College, wrote an analysis that as of April 2019, the world’s top 500 companies such as Samsung, LG, Intel, Foxconn, etc. have invested in Southeast Asia, and more than 1,000 textiles and clothing in my country , Toys and other companies have also shifted their manufacturing focus to Southeast Asia. The migration of the world’s manufacturing industry to Southeast Asia has lengthened the distance between the customer’s supply chain and created a gap in the supply chain in Southeast Asia.

Yang Daqing, a special researcher of the Chinese Society of Logistics, also told the China Business News that the biggest advantage of Chinese companies is that they are sitting on the demand side of international express delivery and have a large number of consumer goods logistics orders.

In addition, Zhao Xiaomin also told Zhixiang.com that he is now facing a major change in the reshaping of the supply chain. The United States and Japan have proposed the return of the manufacturing industry. The reshuffle of the industrial chain requires close attention by express logistics companies.

The cargo route of SF Shenzhen-Kuala Lumpur route set sail / Picture source: SF official website

On the other hand, cross-border e-commerce is also developing rapidly in Southeast Asia. According to the “2019 Southeast Asia Digital Economy Report” jointly released by Google and Temasek, the scale of the Southeast Asian e-commerce market in 2019 was US$38 billion. It is estimated that by 2025, the market size will exceed 153 billion US dollars.

Affected by the new crown epidemic, e-commerce has accelerated its penetration into the daily lives of Southeast Asian residents. A Singapore resident recently told Zhixiang.com that e-commerce was not well developed in Singapore. People rely on offline shopping or shopping in neighboring countries such as Malaysia. Due to the blockade caused by the new crown epidemic, Singapore’s demand for e-commerce has begun to increase.

However, the development of logistics in Southeast Asia cannot meet the booming demand. According to Momentum Ventures, by 2018, the logistics system in Southeast Asia will only cover most of the first- and second-tier cities, and has not yet been fully rolled out. In the busy stage of distribution, logistics companies will still have a large backlog of inventory before delivery, and the Indonesian logistics market is currently in short supply.The status of the request.

According to Yang Qing’s statistics, in recent years, more than 10 express companies in my country have adopted various methods to establish overseas warehouses and business outlets in Southeast Asia, with a total investment of more than 10 billion US dollars.

Three, melee

The huge market dividend has made Southeast Asia a must-see for Chinese express companies to open up overseas markets. Not only SF Express, but Southeast Asia has attracted many players in recent years, including giants such as Tencent, Alibaba, and Pinduoduo, as well as leaders in the domestic express delivery industry such as Zhongtong, YTO and Best.

Tencent has directly or indirectly invested in Southeast Asian platforms such as Sea Group, Go-Jek, Traveloka, Pomelo Fashion, and Tiki.vn.

Sea Group is known as the “Little Tencent” in Southeast Asia. As an e-commerce platform under Sea, Shopee’s GMV for 2018 is expected to reach US$9.2 to 9.7 billion, an increase of 124% to 136% over last year. Shopee has established its own logistics in many Southeast Asian countries.

JD.com went off in person. As early as November 2015, JD.com established the JD Indonesia station. In September 2018, JD.com and Thailand Central Group (Central Group) The Thai online retail platform JD CENTRAL built together was officially launched. The Zhixiang.com learned from relevant channels that JD intends to export its efficient logistics to Southeast Asia.

While upstart Pinduoduo has no plans to go abroad for the time being, in China, Super Rabbit Express is disrupting the “spring of water” in the animal flow industry. The birthplace of Jitu Express is Southeast Asia, where it is called J&T.

SF Transportation of Anti-epidemic Materials / SF Official Website

However, Chinese players are still very immature.

Yang Qing, director of the logistics management teaching and research office of Guangxi Vocational and Technical College, believes that at present, international express delivery giants DHL, UPS, and FedEx have successively started business in Southeast Asia, and Chinese express companies will face their challenges when they go overseas.

He further analyzed that my country’s express delivery companies are still in the stage of expanding their markets in Southeast Asia and are operating at small profits. Most of the package pricing is in the low price range of 8 to 10 US dollars, while the average unit price of foreign express companies is 28 to 40 US dollars.

However, since 2017, SF Express has successively cooperated with United Parcel(UPS), American logistics service platform Flexport, American logistics service platform Flexport, and American summer Hui Group and DHL (DHL Express) reached a cooperation. In Southeast Asia, SF Express has avoided the risk of competing with these international express logistics giants to a certain extent.

This article is from WeChat official account:Passagegroup (ID:passagegroup), author: Xie Xiaodan