Since 2023, rumors of express logistics companies going to Hong Kong stock market for listing have continued to spread. First, in February, it was reported that Jitu Logistics planned to be listed in Hong Kong in the second half of this year; on the other hand, Cainiao Logistics, SF Express and other companies also put their listing in Hong Kong on the agenda.
It is worth noting that, as an established logistics and express delivery company, after experiencing a long-term "price war" and the impact of the epidemic, in the first quarter of this year, with the improvement of the external environment, its performance is generally improving. All this indicates that The current express delivery industry is brewing a new change.
Performance improvement of e-commerce logistics giants
As of May 23, all companies in the "Tongda Department" have announced their results for the first quarter of 2023. Judging from these performance data, with the slow recovery of the domestic economy, the operating data of major logistics companies are continuing to improve.
Last Thursday, ZTO Express (ZTO.N, 2057.HK) announced its financial report for the first quarter of 2023. The financial report shows that in the first quarter, ZTO achieved revenue of 8.932 billion yuan, a year-on-year increase of 13.7%; adjusted net profit was 1.92 billion yuan, a year-on-year increase of 82.1%. Earlier, Yuantong, Shentong, and Yunda also released their first-quarter performance announcements, and they all showed obvious signs of improvement.
Data show that in the first quarter of 2023, YTO achieved revenue of 12.914 billion yuan in the quarter, a year-on-year increase of 9.19%; net profit attributable to the parent was 906 million yuan, a year-on-year increase of 4.08%; Shentong’s revenue in the first quarter was approximately 8.744 billion yuan, a year-on-year increase of 22.25%; The net profit attributable to shareholders of listed companies was approximately 133 million yuan, an increase of 24.91% year-on-year; in the first quarter, Yunda realized that the net profit attributable to shareholders of listed companies was approximately 359 million yuan, an increase of 2.96% year-on-year. The good data of the entire "Tongda Department" is mainly due to its comprehensive measures in many aspects.
One is that the main enterprises of the "Tongda Department" are continuously strengthening their "cost control ability" under the "price war", thus achieving a good situation of "both volume and price". Taking ZTO as an example, the single-ticket transportation and sorting costs of ZTO Express in the first quarter fell by 10 cents year-on-year. With the improvement of "cost control ability", ZTO's market share has once again increased. In the first quarter, the parcel volume of ZTO Express was 6.297 billion, a year-on-year increase of 20.5%, and its market share increased by 1.8 points to 23.4%.
Coincidentally, companies such as Shentong and Yunda, which are also facing price wars, are also actively adjusting their deployments, seizing the window period for the acquisition and integration of Best Express by Jitu Logistics, expanding market share through various positive measures, and fully releasing the scale effect to even out single-ticket transportation costs , Improve capacity utilization, and ultimately make its overall benefit continue to improve.
The second is to improve product pricing power by providing better service and timeliness. From the perspective of the entire express delivery industry, all links are relatively similar. The only thing that can break the homogeneity is the time-sensitive experience, which determines the retention of users. This is also a powerful weapon for Tongda to break through low-price competition. Take YTO as an example. In recent years, YTO has been focusing on air transportation to improve its time-sensitive service capabilities. Statistics show that by the end of 2022, YTO will have 11 self-owned aviation fleets, including 2 Boeing 767-300s and 9 Boeing 757-200s, covering more than 80 international routes. Many big customers.
Relying on the advantages of time-sensitive experience brought by air transportation, YTO's performance has maintained a positive trend in the past few years. According to public data, YTO's net profit for the whole year of 2021 will increase by 19% year-on-year; in 2022, its net profit will increase by 86% year-on-year. In terms of air transportation, ZTO Express is also not far behind. As early as 2020, it launched a high-end time-sensitive product for air cargo, namely "Star United Air Time-Limited Parts", thus forming its own door-to-door express delivery service. .
Different from YTO, in terms of air transportation, ZTO mainly realizes it by "joining" air cargo companies, which makes it have higher gross profit (net profit is higher than SF Express) while maintaining the advantages of air transportation. . Under the comprehensive influence of these measures, the "Tongda" enterprises have significantly improved their performance and achieved new development.
Digitalization and high-quality development have become new keywords
In addition, in order to strengthen their own advantages and capabilities, major express delivery companies, including Tongda, have accelerated the pace of digitalization. At the same time, with the elimination of outdated production capacity, high-quality development has become a new keyword.
First of all, with the maturity of the e-commerce industry and the continuous price war among express delivery companies, the digitalization of express delivery companies has become an inevitable trend. In recent years, with the gradual sinking of e-commerce platforms to towns and villages, the e-commerce market has become increasingly mature, and industry price wars have continued one after another, forcing companies from all walks of life to speed up the pace of "cost reduction and efficiency increase", and digitalization has become the key to breaking the situation . On the one hand, this is due to the fact that major e-commerce platforms including Ali and JD.com have already deployed in the field of logistics, and their digital capabilities are relatively strong, which forces the entire industry to speed up to follow this trend; on the other hand, digital empowerment industries , effectively improving the efficiency of the intermediate link.
Taking YTO as an example, by actively promoting the digitalization and standardization of the entire network, it empowers all express sorting and delivery links in an all-round way, and all franchised express outlets, enabling it to reduce costs and increase efficiency in the entire process. The cost visualization of the shipping process provides a basis for dynamically adjusting the express single ticket price. Similarly, major express delivery companies such as ZTO, STO, Yunda, and SF Express are also strengthening the construction of logistics digitalization to enhance their overall network advantages and economies of scale. It is not difficult to foresee that with the deepening of digitalization in the industry, the digitalization of the express delivery industry will further deepen.
Secondly, with the implementation of the express price supervision policy, the "vicious low-price competition" has come to an end, and the industry has gradually shifted from the pursuit of quantity to the pursuit of quality. From July 2021 to January 2022, relevant departments have successively issued a series of policies and regulations, effectively curbing the harm caused by "low price competition" to the industry, and the industry price "stopped falling and stabilized", and gradually entered a new era. period of healthy development.
At the same time, under the price war, a large number of small and medium-sized express delivery companies have completed the "clearing of the industry". The market share of major leading companies has further expanded, and the market concentration has once again increased. The strategic focus of leading companies has begun to change, and they have begun to focus on being criticized. After a long time of terminal experience problems, various measures have been actively taken to improve user experience, the industry reputation has gradually improved, and the industry has entered a new stage of high-quality development.
A new pattern is taking shape
It is worth noting that at present, including Cainiao, Jitu, and SF Express, there have been rumors of listing. Among them, SF Express is a secondary listing, while Cainiao and Jitu are listed for the first time. Before the listing news came out, Cainiao had completed its spin-off as part of the Ali Group, and Jitu Logistics had recently acquired Fengwang, a subsidiary of SF Express, after completing the merger and acquisition of Best. The valuation level has been rising all the way. These news all indicate A new pattern of the domestic express delivery industry is taking shape.
First, from the perspective of Tongda Department and SF Express, the leading Matthew effect has been further enhanced. From the point of view of order volume, market share and profitability, ZTO is still a well-known leader in e-commerce, and its market concentration continues to increase. According to the data provided by the public information, the annual express orders of Zhongtong, Yunda, Yuantong and Shentong last year were divided into 24.3 billion, 17.609 billion, 17.479 billion and 12.948 billion, of which Yunda was similar to Yuantong, but The gap between Zhongtong and Zhongtong on the head has widened significantly, and there is also a big difference between Shentong and the previous Yunda and Yuantong. It is not difficult to see that the gap between the various express companies within the Tongda Department has further widened.
Looking at SF Express again, due to the different operating models, it is fundamentally different from Tongda. From the perspective of revenue scale alone, SF Express’s annual revenue in 2022 will be 267.49 billion yuan, which is about equal to the sum of Tongda’s express delivery giants (the total revenue of ZTO, YTO, STO, and Yunda is 201.337 billion yuan), Profitability is second only to ZTO in the industry. With the agreement between SF Express and Jitu Logistics on Fengwang’s merger and acquisition, its subsequent profitability may be further improved, and it will continue to maintain its influence in time-sensitive parts.
Second, new forces represented by Cainiao Logistics and Jitu Logistics are gaining increasing influence in the domestic express delivery industry. Among them, after Jitu entered the Chinese market from overseas, it quickly established the network through mergers and acquisitions. In less than two years, the order volume has gradually broken through and stabilized at 40 million orders from less than 20 million orders per day. above. If it is only calculated in terms of order volume, its ticket volume has successfully ranked among the first echelon of domestic express companies, becoming the express company second only to ZTO, Yunda and YTO. With the success of the acquisition of Fengwang, the influence of Jitu Express in the domestic express delivery industry may be reshaped again.
Looking at JD Logistics again, after the spin-off of the listing, it has now entered many fields such as intra-city and less-than-truckload freight. Especially after the acquisition of Debon Logistics and cross-border express last year, its revenue volume and scale have improved. The leap of industrialization is increasing day by day. Since Cainiao was established in 2012, its revenue has grown from a few hundred million yuan at the beginning to now covering domestic and foreign markets, with a revenue of 23 billion yuan, with external customers accounting for 72% and group revenue accounting for 7%. The influence of super behemoths is also increasing day by day. It is not difficult to find that after many rounds of adjustments, the new pattern of logistics is becoming increasingly diverse and complex.
Where to find incremental growth in the post-e-commerce era
With the formation of a new industry pattern, what are the future opportunities for "Tongda" companies that started with low-end e-commerce software? At present, there are two main opportunities: one is the opportunity to refine the market; the other is the opportunity for cross-border e-commerce.
On the one hand, with the emergence of new consumption needs of users, the market for new time-sensitive parts centering on "entering factories and entering villages" is emerging. With the rapid growth of the volume of logistics packages, the needs of user terminals are also increasingly diversified, resulting in many time-sensitive requirements for "entering factories, parks, and villages", which have given new opportunities to e-commerce logistics companies. Chance.
For example, for large-scale home decoration products, some logistics companies have launched a product of "express delivery into the factory + delivery and packaging", which improves the efficiency of cargo transportation and further optimizes the user experience. Today, SF Express, YTO, ZTO, and Yunda are all promoting "express delivery into factories", actively integrating into the upstream and downstream industrial chains of the manufacturing industry, tailoring personalized services for customers, and constantly exploring new paths for incremental markets.
On the other hand, with the development of live broadcast e-commerce and cross-border e-commerce, the e-commerce market is gestating a new incremental space, which also means new opportunities for logistics companies that are good at e-commerce parts. According to customs statistics, China's cross-border e-commerce imports and exports have increased nearly 10 times in five years. Last year, the scale reached 1.92 trillion yuan, an increase of 18.6%. With the rapid development of cross-border e-commerce, cross-border logistics has also ushered in new opportunities.
At present, major express delivery companies including YTO, ZTO, SF Express, JD.com, Cainiao, and Jitu are all advancing the development of international cross-border logistics. In the long run, the opportunities for e-commerce in overseas emerging markets are still greater than those in China, and the future prospects are optimistic. For many e-commerce logistics giants that have emerged in the domestic market, the next step is to solidify the "basic market" while grasping opportunities to go overseas will become a compulsory homework.