25.11.2024
Chinese e-commerce companies are locked in fierce competition, writes Kolster CEO Timo Helosuo in his blog after returning from a state visit to China. He believes that growing consumer environmental awareness will compel businesses to adopt increasingly eco-friendly delivery solutions.
Last week at this time, we were on a state visit to China led by President Alexander Stubb. I had the honour of participating as the sole representative of IPR firms. Intellectual property rights remain a key issue concerning China, and Kolster is well-known as an expert in this field. In total, the business delegation included representatives from nearly 30 Finnish companies. During the visit, we held several meetings with leading Chinese companies.
The Finnish companies on the trip represented four sectors: technology, green growth, well-being, and sustainable mobility. Finland has international-level expertise in all these areas.
Logistics Companies’ Role in Environmental Impact
Logistics play a significant role in environmental sustainability. The growth of international e-commerce is increasing the carbon footprint of deliveries. The pressure to develop greener transportation solutions for online purchases is mounting rapidly. Consumers are becoming increasingly aware when choosing delivery methods for their online shopping, and e-commerce companies are being asked to report their emissions. Representing Finland’s logistics sector during the visit was Nurminen Logistics.
Currently, the cost of delivering a single package in China is €0.40, and the average delivery time is 2.7 days.
Packages Delivered in Less Than Three Days
We had an insightful discussion with Lin Wan, CEO of Cainiao Smart Logistics Network, a company responsible for the logistics of Chinese e-commerce giant Alibaba. CEO Wan highlighted the strategies being implemented in China to reduce the carbon footprint of deliveries.
We also learned about the competitive landscape of e-commerce and logistics from Mervin Ye Zhou, Strategy Director of another major Chinese e-commerce player, JD.com. According to him, logistics in China is dominated by a few giant companies that compete fiercely. The numbers are striking: delivering a single package in China currently costs €0.40, with an average delivery time of just 2.7 days. This is a remarkable achievement in a country with a population of 1.4 billion, where shopping has largely moved online. Efficiency has been achieved through innovative operational models and the use of technology.
Mervin Ye Zhou (seated on the far right) also noted that logistics in China is concentrated among a few major players.
So far, geopolitical tensions have not significantly affected international e-commerce deliveries, but I suspect this will soon change. If tariffs and duties increase, consumers may see the effects both in the selection of goods available online and in shipping costs.
