E-commerce competition forces express companies to take sides
Three Alibaba-backed delivery services have recently been blocked by e-commerce giant Jingdong, which claims it only recommends vendors with high ratings and less complaints
China’s express market has so far been dominated by six major delivery companies, including STO Express, YTO Express, ZTO Express, Yunda Express, SF Express and EMS. But new market players such as Best Logistics and TTK Express, who want to break into the game, may have to carefully choose which e-commerce platform to rely on, according to an article in 21st Century Business Herald.
Alibaba, which owns Taobao, a major online shopping site, is the biggest shareholder of Best Logistics, holding 23.4% of its stake. At the same time, Alibaba accounts for 17.52% shares of YTO Express. It is also the second largest institutional shareholder of Suning Commerce Group, which owns TTK Express.
These three Alibaba-backed delivery services have recently been blocked by Jingdong, another e-commerce giant. Jingdong sent notices to vendors on JD.com, asking them to use JD Logistics, SF Express, ZTO Express, Yunda Express or STO Express.
Jingdong said in an interview with the 21st Century Business Herald that they choose delivery partners based on customers satisfaction — “We just recommend vendors to use high rating delivery companies with less complaints.” Meanwhile, insiders think the competition between the two e-commerce giants is forcing delivery companies to take sides.
Except for EMS, the remaining five home-grown express giants have sent and received 9.99 billion items over the fist half of the year, accounting for 57.7% of the packages around the nation.