On October 15th, Yuantong Express official website announced that in order to ensure the safety and stability of express delivery service during the peak season, to ensure the quality of service and customer satisfaction, we should respond to the peak season in the express delivery, transfer, transportation and dispatch. The cost of employing, using cars, and expanding the venue will increase. Yuantong Express will adjust the express delivery charges from November 11, 2019. As early as a few days ago, Zhongtong took the lead in announcing the price increase of the Double Eleven, which became the leading brother of Tongda’s double-eleven price increase this year.
For the price increase of the double eleven, everyone has already been unaware of each other. Every year, the price of double eleven is rising. The follow-up of each family is already an open secret of the industry. As for the reason for the price increase, it is naturally simple. The annual express orders of the double 11 skyrocket, the tight delivery of vehicles, materials and materials, and the shortage of personnel. And so on, all need to add additional costs, and the price increase is inevitable.
Of course, the most important one, although no one has said it, is the unspeakable generality of the domestic express delivery industry, that is, the vicious circle of the industry caused by low-price competition.
Behind the price hike, low-cost competition makes the express industry into a red sea
In the double eleven preparation period, the courier companies are ready to go all out, but they start to raise prices at the same time. This is the practice of the past years. Recently, Zhongtong and Yuantong have announced price increases, and they have become the “pioneer officials” of this year’s express delivery enterprises.
Near the “Double 11”, the price increase of express delivery has never been a business matter. In this regard, industry insiders said that the peak price of express delivery companies has gradually become the norm. From 2014 onwards, until now almost every year before the eleventh, we will receive information about the courier fees of express delivery companies. The current price increase is not unusual.
Behind the price increase is the industry dilemma facing the “quantity increase and price drop” faced by express delivery companies. One side is a huge amount of express orders, and the other side is a thin, breathable single unit price. “The business volume has doubled, but the amount of orders for a single order has plummeted and the profit is too low,” said the source. Behind the seemingly prosperous, it is an invisible invisible dilemma.
The competition in the express delivery industry is price in addition to service. The standard of services in the express delivery industry similar to e-commerce companies, the difference is not big, and consumers themselves are more sensitive to prices. Therefore, the express delivery industry often forms a price cut, and many follow-up situations, after all, does not mean that the customer is lost, so the cycle has formed the end of “burning money for share.”
The 2019 semi-annual report shows that the single-voting cost of Yuantong in the first half of the year was 2.81 yuan, a year-on-year decrease of 11.56%, and the single-ticket income was 3.19 yuan, a year-on-year decrease of 10.71%. As of August this year, the single ticket revenue has plummeted to 2.72 yuan. According to related reports, if Yuantong did not reduce costs in the second half of the year, then each single express delivery was in a loss state.
The result of the money-burning war is mostly the Matthew effect: as of the second quarter of this year, Zhongtong has a 19.9% market share and is firmly in the position of the boss. Yunda, Yuantong, Shentong and Shunfeng are close behind. The occupancy rates were 15.5%, 13.7%, 10.8%, and 7.3%, respectively. In the first half of the year, the single-ticket revenue of the industry was only 1.63 yuan, only about half of the companies such as Shentong and Yuantong. In order to maintain market share, Zhongtong had to swallow his tears.
As SF entered the e-commerce business, it also faced the same fate. The ticket revenue was reduced from 7-8 yuan at the time of its launch to about 5 yuan. The transformation anxiety disorder has been concentrated in the SF industry that has always been the industry. In the past 6 years, SF7 has changed its CEO, and from fresh e-commerce to cross-border e-commerce, there has been no progress.
After the industry burns money, the head enterprises are more internationally competitive, and consumers get more benefits; and those new express companies that have entered the industry are undoubtedly victims, that is, for the giants, the profits are dilute, facing Operating pressures, but also have to take measures such as salary cuts and layoffs, couriers suffer.
It is precisely because of these factors that some express delivery companies are forced to break away from relying on low-end e-commerce components and begin to enter the mid- to high-end market with higher added value.
The war has burned into the mid to high-end market
Since October 20, 2016, after the successful listing of Yuantong, it was the first to open fire in the middle and high-end market under the blessing of capital. On October 17, 2018, Yuantong launched a “commitment” targeting the mid- to high-end market. The company launched the business of Yuantong and Yuantong Cichenda, which also marked the official entry of Yuantong in the high-end market.
Behind the launch of Yuantong’s commitment, it is based on two considerations: One is to alleviate the current problem of over-reliance on low-end e-commerce, low profits, and over-competition; second, the new retail development is in full swing. The e-commerce business is in the ascendant. Some important e-commerce customers have high requirements for timeliness and are not too sensitive to the price. High-end distribution can increase the profits of enterprises.
Tiantong official website data shows that since the brand was released in October 2018, it has promised that Dart Express has set up more than 700 directly operated sales offices in 92 cities, and will reach nearly 1,000 direct management business departments by the end of 2019. Committed to the express service network covering nearly 1,500 cities and counties, basically established a platform-based logistics network system. The network construction has achieved initial results, and the platform has emerged.
Of course, the most direct result of entering the mid-to-high-end market is that it will inevitably face direct competition with SF, and SF’s advantage in this respect is obvious.
Shunfeng Express is a comprehensive logistics network company specializing in express transportation and business in China. Its main market is to serve the mid-to-high-end market. In the “Tongda Department”, the price war for e-commerce is beaten. At that time, SF is keeping the starry sky forty-five degrees, arguing the entire express logistics industry.
After all, the same delivery, SF has the highest standard shipping service in the same industry and the highest consignment profit in the same industry. In the middle and high-end market, there are “proud” fans. It is said that the first time people think of it is SF. . It is based on this that in the future competition in the middle and high-end market, the battle situation will be anxious.
In addition to moving to the high-end market and seeking new development, it is also an inevitable choice for current logistics companies to rely on new technologies such as big data and cloud computing to empower logistics companies, transform supply chains, and achieve more efficient and refined operations.
Logistics innovation in the era of big data
The cost of courier is not always rising. The upgrade of the electronic surface and freight network optimizes the efficiency of the express delivery and also reduces the cost.
Before 2013, express logistics companies relied on their own fixed-line outlets and nationwide logistics networks to achieve and consolidate their own advantages, all of which have undergone new changes with the advent of new smart logistics. .
After the establishment of rookie logistics in 2013, whether it is electronic face, level 4 address library, intelligent planning system, big data routing, or logistics cloud, rookie through the application of big data to improve express delivery companies effectiveness.
Shunfeng Express is the first company to start using electronic orders on a large scale. This kind of electronic printing with thermal printing has a cost of 0.5 yuan lower than that of the old triple paper.
The rookie has published a data: after the electronic surface is on the line, the logistics delivery efficiency is accelerated by more than 30%, and the big data routing is divided.The sorting efficiency is increased by 50%. In particular, the popularity of electronic orders has greatly contributed to the industry: “With automatic electronic ordering, automatic sorting can be achieved. This is disruptive to the entire industry. Otherwise, economies of scale cannot be realized, and it is difficult to make money.” .
A courier said that when using the electronic face sheet initially, the receipt can save at least 5 to 10 minutes, which is equivalent to one day and less one building.
In addition to relying on electronic information systems, the courier company has greatly reduced the loss of lost orders. In 2017, the loss rate of Shentong Express was 1.39. The first news released by China Post this year showed that the number of complaints filed by consumers due to courier services was 4,688, down 64.1% year-on-year. At this rate, I believe that after a few years, the loss of the policy will eventually disappear.
Automated sorting systems are another major investment in improving logistics efficiency. In the past few years, Jingdong, the rookie alliance, SF, and Tongda have strengthened the construction of the transfer sorting center and introduced automatic sorting. Automated sorting is expected to save 70% of the labor costs of the transfer station and reduce the cargo retention rate. In addition, Suning Yuncang has become a rising star and has become a new player in the field of smart logistics.
Because of the wide application of electronic orders, in the big shopping festival of Double Eleven, you can rely on electronic information such as online order quantity, prepare for prevention in advance, prevent logistics from exploding, and greatly enhance social logistics. Collaborative efficiency. In addition, after capturing the logistics information resources and identifying big data, we can transform the offline logistics outlets according to the logistics address information, abolish unnecessary logistics outlets, improve the overall efficiency of the logistics industry, and make the outlets more optimization.
Of course, in addition to technological transformation, with the appearance of the local life of take-out, a new type of logistics distribution was born. Instant delivery in the same city has become a new market for express delivery companies.
Immediate distribution into the new battlefield in the same city
In the mid-to-high-end market, Yuantong has set its own service target as e-commerce customers who have personalized requirements for timeliness, and will also provide personalized services for new retail formats and cross-border e-commerce customers. The goal of Yuantong is not only as simple as the mid- to high-end market, but the entry of new retail will also be one of the important goals.
In the fields of new retail and cross-border electricity business, e-commerce companies represented by Ali, Jingdong and Suning naturally become their direct competitors. For example, in the same city of Jingdong, the real-time distribution of Dada and Jingdong arrived home, is Ali’s hungry?Its Hummingbird Middle Pack is also the head player in the timely delivery field in the same city.
Suning’s smart retail, relying on its own offline properties, stores, Suning Plaza and other forms, has also entered the competition of the same city distribution, many new players continue to emerge. For example, the emerging city distribution company flash has also joined the ranks and demonstrated its unique advantages.
In addition, the US group has always been based on the upgrade of local life service. In the field of home-to-store service, it is also the top of the industry. With the help of the US group, it can realize its own scale expansion, and also want to share a piece in the timely delivery field. .
The business of the same city distribution started to sprout under the influence of China’s developed electric commerce. People are accustomed to the e-commerce take-away delivery service, and have already developed the shopping habit of enjoying shopping without leaving home. This habit is the root cause of the distribution of the same city from point to line, from line to face, and gradually eroded the original market share of some express companies. It is for these reasons that the city’s distribution has become a new battlefield.
In the field of distribution in the same city, the real-time distribution represented by timeliness, the cold chain distribution represented by fresh retail distribution, and other formats flourish, and many new head companies will be born in this field in the future. .
As a new battlefield, the stars will gather and the 100 cities will gather together. The same city distribution will become an important battlefield for future logistics competition.
summary
The domestic private logistics industry originated in the 1990s and developed in the early 21st century. It has flourished in recent years, and it has experienced more than 20 years of development. Now it is facing a new industry change: one side is intelligent and unmanned. The technological innovation brought about the improvement of the efficiency of the whole industry; on the other hand, the emerging markets are booming, and the traditional price wars are difficult to sustain with the recovery of labor costs and rents.
For future logistics companies, low-cost competition is definitely not the way. In the future, the logistics industry wants to develop healthily. On the one hand, it needs to meet differentiated individual needs, seek new incremental markets, and reduce costs by adjusting the logistics structure, that is, to increase the profit of the industry by raising the freight rate; New technologies and new methods such as intelligent distribution, optimize storage costs and improve efficiency to cope with the major changes in the industry.