Express deliveries set to soar

BEIJING - The number of domestic express package deliveries is expected to reach a record high of 393 million in the month running up to the Chinese New Year, according to the State Post Bureau of China.

The figure is predicted to rise by 143 million, or 57.2 percent, from the same period last year, which may paralyze the express service in some parts of the country, said Han Ruilin, a spokesman for the State Post Bureau of China, at a news briefing on Friday.

The annual Chinese Spring Festival, which falls on Jan 23, will usher in a period of peak deliveries, as e-commerce dealers often offer large sales promotions and people send more parcels to their home regions.

A similar surge in demand forced many delivery companies to suspend the acceptance of new packages weeks before this year's Spring Festival.

"We expect an improved situation this time round, though the challenge is much tougher (compared with last year)," Han said.

On Friday, the bureau issued a directive to ask Chinese courier companies to maintain normal operations during the year-end delivery period.

In large Chinese cities where there is great demand for express services, delivery companies should hire additional shuttle buses to make sure packages are not delayed, the directive continued. The increasing popularity of China's e-commerce business has pushed the express delivery industry to breaking point, said analysts.

Taobao Mall, the business-to-consumer division of Alibaba Group Holding Ltd, secured orders worth 3.36 billion yuan ($530 million) on Nov 11 alone - more than three times the amount on the same day in 2010.

Daniel Zhang, president of Taobao Mall, said recently the combined number of packages from Taobao Mall and Taobao.com - China's largest consumer-to-consumer online shopping site - reached a record high of 28.5 million on Nov 11.

"The figure exceeded the total number of packages that all the Chinese courier firms can deal with in one day," said Zhang, underlining the logistical challenge faced by Taobao.

Da Wa, secretary-general of the China Express Service Association, said the domestic demand for express services will far exceed supply in China for at least the next five years.

Da predicted that the number of domestically delivered packages in 2011 will total more than 3.5 billion.

China is the world's third-largest express market, behind only the United States and Japan. The transaction volume has realized average annual growth of 27 percent in the past five years, with the number of packages and documents processed daily increasing from 3 million to 13 million during the same period.

China's express industry will expand steadily in the next four years, with annual sales reaching 143 billion yuan and the value of processed packages hitting 6.1 billion yuan by 2015, Ma Junsheng, director-general of State Post Bureau of China, said in November.

China Daily

(China Daily 12/31/2011 page9)