Online Retail Boom Growth, LTL, M & A Surge

Beijing is cooling down again.

Outside the North Fifth Ring Road, the first floor of the Zhongguancun Software Park International Conference Service Center, which can hold 432 people, is crowded with people.

It was Friday, and when the night fell, these people still did not leave.

This is the first China Electronic Commerce cross-border industry summit. Most of the people who did not leave came from nearly 100 investment institutions, and entrepreneurs who wanted to sell their own e-commerce, logistics and other projects.

They all want to find the right funds and projects.

Wang Xuanqing, deputy director of the Department of circulation development of the Ministry of Commerce, said that the development of information technology and network technology is bringing about a new industrial revolution.

It is also a huge change to the retail industry, and logistics has become the key to supporting the new round of retail revolution.

In the past few years, with the frequent development of the country's good policies, the logistics industry has been developing rapidly. The merger and consolidation of the express industry has been the first to start and highly polymerized. The top six express companies have seized 80% of the market share.

As people buy more and more goods online, the mode of pportation has shifted from express delivery to less than load logistics.

"The next opportunity to break out should be in the express industry."

Wang Yongjun, chairman of Anning logistics, told the twenty-first Century economic news reporter that at present, there are tens of thousands of enterprises in the express pportation industry, while the top six express companies account for only 5% of the market share. Most of the rest are small businesses with considerable volume, and there are huge opportunities for investment integration.

In the fast track industry, the franchising system will be promoted, and the competition mechanism and discourse right will be obtained.

Opportunity in mutation

PWC has recently released a research report that the consumer market is undergoing pformation, and consumers have shifted from a price preference to a more quality oriented one.

The rapid rise of e-commerce and social media has prompted consumers' consumption patterns to show the trend of intelligence, interconnection and autonomy. Consumers are more active in choosing different channels to purchase according to their needs. These changes are profoundly changing the retail industry in China.

Consumer oriented, full channel operation has become the mainstream of retail business pformation.

Chinese consumers are leading the world in online shopping. 1/7 of Chinese consumers are shopping online every day, while the global corresponding figure is only 5%. The proportion of online shopping per week is 60% in China, while 21% in the world.

Wang Xuanqing also said: "China's retail industry is experiencing a profound revolution, that is, online retailing."

According to its disclosure, in the first three quarters of this year, the retail sales volume of the whole country has reached 1 trillion and 820 billion, an increase of 49.9% over the same period last year, compared with 1 trillion and 850 billion last year.

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At the same time, the traditional retail enterprises generally have business difficulties.

Wang Xuanqing revealed that in 2013, China's retail top 100 sales grew for the first time in single digits, less than 10%.

The share of total retail sales of goods has decreased from 11.1% in 2009 to 8.6%.

Large entity shops have been closed, as of June this year, Parkson closed six stores, Suning stores in 2013 decreased by 79 compared with 2012, Gome reduced by 100.

To take the initiative to embrace the new market, retailers are actively integrating online and offline.

In 2013, the growth rate of retail sales of traditional retail enterprises reached 38.6%, and the proportion of online retail sales accounted for 2012 of the total sales increased from 2.3% to 2.3%.

At the same time, the electricity supplier actively infiltrated into the offline entities. Jingdong announced that O2O cooperation with 15 cities and tens of thousands of convenience stores, and the deep cooperation with Tang Long supermarket in Taiyuan formed Jingdong Tang Long store, basically forming an online shopping mall plus physical stores and logistics distribution network.

It is said that the development of information technology and network technology is bringing about a new industrial revolution.

It is also a huge change to the retail industry. Logistics has become the key to supporting the new round of retail revolution.

Wang Yongjun also said that with the retailer's comprehensive touch network, the B2C market has been set up in homes, industrial accessories, household appliances, home textiles, clothing, ceramics, food, building materials and other industries, and consumers can purchase large items such as furniture, household appliances or building materials online, and send them directly to the home.

According to its disclosure, only the household electricity supplier orders, in 2013, the paction volume of Ali platform will reach about 35 billion, and the visible future will continue to grow rapidly.

The rapid rise of B2C will undoubtedly accelerate the demand for LTL express.

Before that, the B2B market accounted for most of the 4000 billion bear express market.

Now, things seem to be changing.

Wang Yongjun believes that the LTL market is ushering in the opportunity of rapid development, and its opportunity is just like the trend of express leaping development brought by the explosive growth of electricity providers in previous years.

According to the data provided by the State Post Office, the volume of express business has increased from 1 billion in 2006 to 9 billion 190 million in 2013, with an average annual growth rate of 37.3%, and the market size is two in the world.

In 2013, the average daily business volume of China's express delivery exceeded 30 million, and the peak period exceeded 65 million.

In 2014, the two data doubled, and the peak business volume even exceeded one hundred million.

Since March 2011, China's express delivery volume has increased by an average of more than 50% over the past more than 40 months.

Behind this rapid development is the acceleration of internal integration and acquisition in the express industry. Up to the end of 2013, there were more than 9000 express companies issuing business licenses by the management departments, but 6 of the 10 billion express companies accounted for 79% of the express market.

In contrast, the express industry has tens of thousands of express companies, while the market share of the top six enterprises is only 5%.

Wang Yongjun pointed out that the current express industry has a market size of 400 billion, far more than the 250 billion market of the express delivery industry. Previously, the electricity supplier was limited to 30 kilograms of small commodities, and the penetration of small businesses was not so large.

But when the demand for electricity in the retail industry has increased from 7% to 10%, or even 20%-30%, the order of express B2C will rise in large numbers, and it will also accelerate the integration of the express industry.

"I believe that the space for the integration of LTL has arrived."

Wang Yongjun said.

With the exception of the integration of special logistics and other difficult problems, the reason why the LTL express can be integrated with the express industry, Wang Yongjun believes that they have the common ground that the service objects are individuals and the discourse power is not strong, so the logistics companies can define standards and products, and can also carry out standardized services, and they can also make network layout.

Coupled with business driven, highly homogeneous demand can push the industry to integrate and achieve big Mac businesses.

If the integration tide is coming, who will lead the integration? According to the twenty-first Century economic report, the leading companies in the express industry are Debon logistics, Tianhua Huayu and energy logistics.

In fact, these three leading enterprises have been eyed by capital too early.

In March 28, 2013, CITIC Industrial Fund purchased 100% stake in Tianhua Huayu from 750 million yuan from TNT express.

Dassault logistics and card office also welcomed the capital investment such as Zhong Ding venture capital.

There have been several rounds of financing for energy logistics. As early as 2012, 2013 and early 2014, 3 rounds of investment including Sequoia Capital and Huaping investment group were acquired. In July this year, Huaping group announced an additional 50 million US dollar investment, which is the second investment of Huaping group to an energy logistics.

With the help of capital, the leading fast shipping giant is developing rapidly. De Bang logistics has a turnover scale of only about 1000000000 yuan in 2009, and this year it is likely to exceed 12 billion.

In the past two and a half years, it has built 7 pportation centers and 350 franchised outlets, expanding its speed to 200%.

In pursuit of market opportunities, Wang Yongjun believes that the franchise system has more advantages.

According to its disclosure, the management structure of network logistics enterprises is divided into three levels, namely, headquarters, distribution and network.

The biggest investment is the outlets. Managing the fifteen thousand outlets in the country is a huge and complex task. Therefore, the development of the direct camp express company is slow or even backward, because the management of thousands of shop managers has exhausted them.