Excerpts from speeches given by logistics industry executives at the recent Council of Supply Chain Management Professionals conference in Tianjin.

Supply chain service providers have great potential for profits if China’s fulfils its ambition to cut logistics costs.
China’s logistics costs totaled $498 billion in 2006 or 18.3% of GDP compared with 9.9% in the United States.
The mainland’s logistics industry still lags two or three decades behind advanced nations.
Domestic logistics companies are small in scale, scattered in several regions and have a low-level of operation and management.
The satisfaction rate of services on a basis of five points is 3.96 for overseas-funded logistic providers, 3.72 for private domestic providers, and 3.61 for state-owned providers.

Alan Turley, vice-president of international affairs for FedEx, Asia Pacific division, said there were poor connections between rail, road and port facilities and a lack of coordination between air, rail and communications authorities. The government, although keen to promote the industry, is hampered by a multiple-layered administration, which only adds to logistics costs.

Fan Gang, director of China’s National Economic Research Institute, said, ‘As China’s urbanization spreads from the coastal provinces to inland rural towns, opportunities will abound for state-of-the-art logistic services in the future as 900 million Chinese live in the countryside and most of the consumption has come from the urbanization process over the years.’