Summary of Key Points
In the first half of this year, the net profits of courier companies generally increased significantly. The main reasons for this are the cooling down of the industry's price war (reducing internal competition) and the companies' own efforts to reduce costs and increase efficiency. At the same time, companies have enhanced their service advantages through the use of AI and business collaboration, leading to clear differences in the development paths of the leading firms. Although policies are favorable to the industry, the sustainability of profits remains to be seen, and the competitive barriers are gradually rising.
Detailed Analysis
1. Significant Increase in Net Profits: The Price War Has Ended, and Profitability Has Returned
Previously, the courier industry engaged in price cuts to compete for business, resulting in high volumes but low profits. This year, the situation has changed:
- Cooling Down of Price War: The average price per delivery has increased by 2.3% (about 7.68 yuan in the first half of the year), with a further increase of 3.8% in June. Data from the State Post Bureau shows that the growth rate of courier revenue (7.3%) exceeded the growth rate of business volume (5%), indicating that companies are no longer relying on low prices to drive sales but are making more money per delivery.
- Cost Reduction and Efficiency Improvement: Companies are taking steps to save money, such as using AI to optimize processes and reduce waste. Shentong mentioned that after the industry's shift away from internal competition, the focus has shifted to service and efficiency, improving the business environment.
- Shunfeng's Unique Situation: Although Shunfeng's net profit decreased by 4.1%, it earned 590 million yuan from the sale of three property subsidiaries last year (a one-time gain). Excluding this, its actual net profit increased by 9.3%, which is still growth.
2. AI + Business Collaboration: Giving Couriers a “Smart Edge”
Companies are using technology and collaboration to improve their services, making them more attractive to customers:
- AI Empowerment: Shentong's AI has improved the identification of damaged deliveries, increasing the accuracy rate from 80% to 95%, almost eliminating all damaged items and reducing compensation costs.
- Dual Network Collaboration: Shentong has combined its franchise network (with many individual customers) with its Dainiao direct-operated network (with corporate customers), allowing for resource sharing. For example, franchise outlets can handle direct-operated deliveries, and direct-operated outlets can use franchise outlets to reach more areas.
- Specialized Services: Yunda has seen a 40% increase in personal deliveries and offers customized services for fresh and fragile items. Shunfeng has expanded its business with industrial and high-tech companies through exhibition services, with scenario-based revenue increasing by 19%.
3. Leading Companies Each Taking Different Paths: No Longer Focusing on Price, but on “Differentiation”
The development paths of the major courier companies are diverging, each with its own strengths:
- Shunfeng: Focusing on international and large-item deliveries, it retains customers through customized logistics solutions and strong service loyalty.
- Zhongtong: Concentrating on improving network efficiency and optimizing personal and return shipping services to increase profitability.
- Jitue: Rapid growth in Southeast Asia and South America, with overseas business as a key driver of growth.
- YTO: Using AI to reduce costs throughout the delivery process, making operations more efficient.
- Shentong: Leveraging a dual-network approach (franchise + direct operation) to capture the market; Yunda: Optimizing internal operations to save costs at every step.
4. Favorable Policies but Many Challenges: The Future Depends on Several Factors
While there are opportunities in the industry, there are also uncertainties:
- Policy Support: The government is promoting initiatives such as “courier services to rural areas” and policies related to AI and delivery technologies (e.g., smart delivery, low-altitude shipping) to help expand the market.
- Sustainability of Profits: Experts suggest that the industry is currently in a “contractionary development phase” (relying on reduced price cuts and cost savings). Whether this can continue will depend on performance during peak seasons (such as Double 11). Only if profits are maintained during these periods can the industry be considered stable.
- Rising Competitive Barriers: The demand for AI technology and better worker conditions (e.g., for couriers) is increasing, making it harder for smaller companies to survive, and the advantages of leading firms will become more pronounced.
- New Collaborations: Jitue has hired Shunfeng's CEO, Wang Wei, as a non-executive director, and the two companies are collaborating in the Middle East and South America, which could change the industry landscape.
- New Opportunities: The shift from influencer-based live shopping to store-based shopping will increase return shipping services, but it will require better courier services. Companies that provide excellent customer experience will have a competitive advantage.
Overall, the courier industry is moving away from internal competition and focusing on improving quality and efficiency. However, the future success will depend on companies' ability to continue innovating and seize new opportunities. While it may mean higher costs for individual customers, the service quality is expected to improve—with fewer damaged deliveries and faster delivery times.