The fragmented state of logistics

Xu Shuibo, CEO of TNT-Hoau, a big player in the logistics industry, states that there are around 789,000 logistics companies in the nation.

Mui-Fong Goh, general manager of the Beijing branch of A.T. Kearney, a US-based consulting company, said the road transportation market in China reached $265 billion as of 2008.

These facts were given at the annual logistics meeting held in Zhengzhou in central China's Henan Province.

 

China's road transportation market is a "highly scattered market," said Mui-Fong Goh. She said the top-10 companies have a less than 3% of the market share.The main leaders are China Merchants Logistics with a 0.6% of the market share, China Post Logistics with a 0.4%, and Sinotrans Group with a 0.4%. Our illustration shows basic logistics. In fact it is a load of new Lenovo computers being delivered.

 

Alibaba reports that Goh attributed the decentralized market to its low threshold of entrance. Operators may start business without setting up any comprehensive network or mastering any professional sales methods. 

TNT-Hoau's CEO Xu Shuibo agreed and said the low-level logistics companies make up most of the market.