China's express delivery industry delivered 6.18 billion parcels and mail from January to September 2013, soaring 61.2 per cent year on year on the revenue of CNY99.57 billion (US$16.2 billion), up 34.9 per cent, according to Dublin's Research and Markets.
In a report entitled "China Express Delivery Industry Report 2013-2016", the mammoth volume increase was driven by the explosive growth in e-commerce.
Within this total, revenue generated by intra-city business rose 49.4 per cent to CNY11.54 billion; inter-city business revenue was up 28.1 per cent to CNY56.64 billion; and international plus Hong Kong, Macao and Taiwan business revenue increased by 30.5 per cent year on year to CNY19.52 billion.
Analysis of the results contained in the report show that the market share of private express delivery companies has kept growing, after they handled 4.77 billion parcels and mail in the first three quarters of 2013, representing a year-on-year increase of 69.2 per cent, with revenue up 51.6 per cent to CNY65.47 billion.
Another significant development is that express delivery firms have started to tap into the aviation system. Following SF Express and China Post, YTO Express and STO also submitted applications to the Civil Aviation Administration last year and may obtain approval by the year-end, the report said.
As of early November 2013, SF Airlines has an owned fleet of 13 cargo aircraft. YTO Express began operating cargo planes in June 2012, and as of the end of October had four cargo aircraft.
Furthermore, foreign enterprises have changed tack in China. UPS now targets the highly profitable market segments; FedEx has unveiled a new port operation centre to boost the operating speed of international express mail; and TNT has switched its focus to cross-border express delivery.
In addition, venture capital/private equity (VC/PE) has accelerated entry into the express delivery market. In early 2013, Leading Capital, Pengkang Investment and Phoenix Capital invested CNY200 million in Quanfeng Express.
In May Sequoia Capital China became a shareholder of ZTO Express with the injection of $30 million; and in late August private express delivery giant SF Express announced its first financing within the last two years.
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