Report

The China Same Day Delivery Market size is estimated at USD 3.05 billion in 2024, and is expected to reach USD 4.36 billion by 2029, growing at a CAGR of 7.37% during the forecast period (2024-2029).

Key Highlights
-The pandemic cannot be ignored as a factor in 2020's numbers. Although China suppressed the coronavirus threat far more quickly than any other country-and has been operating with a mostly normalized economy for almost three consecutive quarters, it is nonetheless true that consumer behavior was altered last year. Online grocery shopping surged thanks to lockdowns, and this preference may prove to be sticky over the long term. Additionally, households remained skittish for many months after the virus ceased to be a widespread danger, and this hesitancy toward social activities helped sustain the e-commerce boost.
-The competition between JD.com (a Chinese e-commerce company headquartered in Beijing) and Alibaba (a Chinese multinational technology company specializing in e-commerce, retail, Internet, and technology) has created an environment where delivery has become a crucial part of the e-commerce experience. 70% of packages in China are delivered same-day.
-This speed of delivery contributes to the success of e-commerce in China. Speed of delivery and customer experience are key, and China has both. JD has a completely different logistics strategy - it does it all itself. There are over 515 warehouses in its nationwide transportation network. Over 90% of orders from JD.com are delivered same-day or next-day by JD's own fleet, which now comprises 65,000 drivers.
-More recently, it has opened up its logistics facilities to other companies - regardless of whether or not they're sellers on the platform. This puts JD in competition with companies like SF Express and creates a 'Fulfilled by JD' capability similar to that offered by Amazon.
-JD is probably one of the first operators to use drones at any reasonable scale, using airborne robots as a consolidator in rural areas. The drone carries a number of packages to the rural town, where the local JD driver takes the consignment, separates the parcels, and then delivers the parcels locally.
-The drone isn't actually doing the last mile, but it's enabling faster delivery to the local node. Alibaba is pushing warehouse automation in an effort to reduce costs. Labor costs are growing in China, albeit from a low base. This, combined with low birth rates, means that, as in the West, there is growing pressure to automate.
-In the delivery sector, the take-up of electric vehicles has been mixed. Delivery scooters, while typically utilitarian, are increasingly electric-powered. But delivery trucks and vans are still powered by internal combustion engines. Having said that, the sheer number of cheap, versatile, and simple-to-drive last-mile electric scooters on the streets is mind-boggling.


China Same Day Delivery Market Trends

Development of a Well-Connected Network Infrastructure in China

The Chinese government is focusing on the development of a modern, high-quality, comprehensive, three-dimensional transport network coordinating the planning and construction of infrastructure such as railways, highways, waterways, civil aviation, pipelines, and postal services, and adopting multi-center and network-based forms to improve the multi-level network system. The country is building an integrated urban transport network, focusing on the integration of trunk railways, intercity railways, urban and suburban railways, and urban rail transit and the improvement of the urban expressway network, and the connection between highways and urban roads and strengthening the connection between urban rail transit and other modes of transportation in China.

The country is also building a certain number of national and regional transport hubs to promote the planning and construction of integrated multimodal transport hubs, improving the service level of transfer or transshipment, and improving the hinterland transportation system. The government is also working on strengthening the Western region, promoting the upgrade of the Northeast region, promoting the construction of the large-scale transport corridors and hubs in the central region, and fast-tracking the optimization and advancement of the Eastern region, forming a new pattern of synchronized regional development.

The construction of major projects is in full swing, promoting the investment to achieve a good start. Data from the National Bureau of Statistics shows that from January to February (2022), investment in fixed assets increased by 12.2% year-on-year, 7.3 percentage points higher than that of the previous year. Among them, infrastructure investment increased by 8.1% year-on-year, and the growth rate was 7.7 percentage points faster than that in 2021.

Such holistic development of the logistics infrastructure is expected to fuel the development of the same-day delivery market with the ease of transportation throughout various regions of the country.

Surge in the E-commerce Market of China

E-commerce in China already makes up more than 50 percent of worldwide retail sales on the internet. Online shopping guide websites were the hardest hit, with 32 of these platforms shut down to account for about 36% of overall casualties last year in the world's largest e-commerce market.

In 2022, about 27.2% of the total retail sales in China were made online, increasing from 24.5% in 2021.

Artificial intelligence and big data are commonly used to respond to customers' queries, provide personalized product suggestions, automate warehouse operations, forecast shopping demand, and optimize the distribution of goods and delivery to customers across warehouses.

A nearly limitless supply of low-cost delivery services, provided by China's millions of migrant laborers, enabled companies like Alibaba and JD.com to provide same-day delivery anywhere in the country for just pennies-a very attractive benefit for uncertain first-time buyers.

China Same Day Delivery Industry Overview

The same-day delivery market in China is fragmented, with companies like China Post, Yunda Express, YTO Express, STO Express, and DHL (a global logistics and supply chain company) as some of the major players in the market. Last-mile is undergoing huge transformations in the country, with increasing demand for shorter delivery times from a growing population of online shoppers pushing the industry in an entirely new direction.

The Chinese economy and its acceptance of the new developing technologies make the country well-placed to become a world leader in last-mile solutions. Fragmentation within the industry is perhaps one of the most China-specific challenges, further complicated by the cross-industry rivalry.

Additional Benefits:

- The market estimate (ME) sheet in Excel format
- 3 months of analyst support