Who is behind the express price war?
Under the price war, worry and wealth
Under the vigorous price war, the giants’ market share battle has fallen into a tug-of-war; but correspondingly, the pressure on couriers and courier stations is increasing. Behind this, there are also door-to-door delivery, complaints, and fines. Between the problems.
"The income from delivery has dropped from RMB 1 per piece to RMB 70 per piece. If you want to maintain the same income as before, the noon break is reduced to only half an hour." On April 14, I worked at Yunda Express for two years. Courier Chen Ning told the Red Star Capital Bureau.
And Wang Zhao, who once ran a rookie inn, also became a courier of SF Express from the boss of rookie inn because of declining profits.
The change in the status quo of couriers' survival most intuitively reveals the trend of the "price war" in the express delivery industry-in mid-March this year, Yiwu, a must-see for express delivery merchants, once again started a price war, with 8 hairs across the country.
You know, at the beginning of 2019, this figure was still 4.2 yuan.
After more than ten years of competition, the express delivery industry has already bid farewell to high-speed growth and has shifted from an incremental market to a surplus market, but the competition among express companies has not stopped.
According to industry insiders, the homogeneity of products in the express market is serious. If you want to grab the market, you can only start from the three dimensions of price, timeliness and service, and price is the most flexible variable among them. This has led to the constant development of the express industry. Accompanied by price wars of all sizes.
At the level of courier brothers, they were forced to participate in the price war, and the pressure to send shipments also increased. They struggled between the huge workload, the huge pressure and the income that did not match, and they fell into the "incremental income" Strange circle.
Price: the most flexible variable
To tell a good story in the capital market, the express delivery giants cut prices on the one hand to promote the growth of orders, and on the other hand, they reduce costs to maintain profits.
Chen Ning, who has been a courier at Yunda for two years, has become accustomed to the life of leaving home at 6 am and finishing work at 9 pm every day.
There is no rest time for a year, but he can earn 15,000 yuan every month, and he has gradually adapted to this rhythm.
But starting this year, Chen Ning’s income has dropped from RMB 1 per piece to RMB 70 per piece.
"Now, our single piece profit margins are shrinking, and I can only guarantee income if I increase the amount to myself." He told the Red Star Capital Bureau, "SF Express's courier delivers about 1.5 yuan per piece, which is equivalent to sending two pieces. If I want to maintain the same income, I can only send one more item, receive one more item, and multi-dimensionally connect customers."
Chen Ning said that before this time the "price war" for express delivery came, he could finish the morning work at 10:30.
But now, I have to constantly go to the outlets to ship the items, and I can rest at 12:30 noon, and start working again at 1 pm.
The time for eating and resting at noon every day is compressed to only half an hour.
In the third quarter of 2020, the single ticket revenue of Yunda, Shentong, YTO and Zhongtong was only 1.25-2.15 yuan, a year-on-year decrease of 18.4% to 33.8%.
In 2020, SF Express's single ticket revenue was 17.77 yuan, a year-on-year decrease of 16.93%. In January and February 2021, its single ticket revenue continued to drop to 17.26 yuan and 15.11 yuan, continuously hitting new monthly lows.
While single-ticket revenue has decreased, business volume has maintained rapid growth.
According to the currently released data, ZTO Express will complete 17 billion shipments in 2020, a year-on-year increase of 40.3%; SF Express’s logistics business volume was 8.137 billion, a year-on-year increase of 68.46%.
How to seize more markets in the fierce competition, now it seems that the answers of the express delivery giants are surprisingly unified: lower prices and fight for the sinking market.
According to statistics, in 2015, the average price of a single express in Yiwu was 7.44 yuan; by the first half of 2019, the price had been cut to 3.45 yuan, and the minimum for parcels within one kilogram was 1 yuan.
It is not only the "Four Links and One Access" that is driving this price down, but also SF Express, and now there is another Extreme Rabbit.
Courier
Under the smoke of price wars, the profits of express delivery units have declined, and only more orders can maintain the profits of couriers and terminal outlets.
This is Wang Zhao's fifth month as a courier for SF Express.
Prior to this, he was the boss of a rookie station in a community in Chengdu.
Two years ago, Wang Zhao used a cost of 100,000 yuan to join the rookie station and hired two full-time employees, with a monthly salary of 7,000 yuan.
Excluding the cost of rent, water and electricity, Wang Zhao received more than 6,000 yuan a month.
Wang Zhao said that since last year, it is obvious that the profit of doing the post station is getting less and less. "In the past, the delivery was 1 yuan, but it has been reduced to 80 yuan from last year. After all the costs are removed, I only earn 30 yuan per package." In general, each month's income has been reduced by more than 1,000 yuan. Faced with pressures such as labor and rent, Wang Zhao had to choose to transfer and came to SF Express to work as a courier.
In addition to the lower and lower prices of dispatched parts, Wang Zhao is even more troubled by complaints: "If employees have a bad attitude and have a lot of queues, customers will be deducted 20 yuan for one complaint, and a package will only earn 30 cents. 20. My monthly fine is around 1,000 yuan."
Yunda’s courier, Xiao Chen, calculated an account for the Red Star Capital Bureau: his daily order quantity is 800-1000, only 200-300 parcels need to be delivered to the door because there is no site condition, but these 200-300 parcels It takes him more than 3 hours to deliver it to the door; and it only takes more than 1 hour for the remaining 70% of the packages to be delivered to the station.
Under the smoke of price wars, the profits of express delivery units have declined. Only more orders can maintain the profits of the couriers and the terminal outlets. Therefore, the couriers will directly place the parcels in the post or express cabinet.
But it also costs to put in the post and express cabinets. Another SF express courier told the Red Star Capital Bureau that the unit price of the rookie post is 5 cents, and the express cabinet is 3 cents. Sometimes the courier will be charged when the express cabinet expires. cost of.
But in the face of saving time, these costs have to be paid.
consumer
Regarding black cat complaints, there were 220,000 complaints from users about express delivery, and many of them were about express delivery not being delivered to your door.
However, while express companies are robbing the market, they also hurt the user experience.
The Red Star Capital Bureau found that in black cat complaints, there were 220,000 user complaints about express delivery, many of which were about express delivery not being delivered to the door.
Nowadays, the platform has also paid attention to this issue.
On April 15th, Taobao announced that it would launch an on-demand home delivery service with Cainiao Station. The first batch of attempts will be launched in Beijing, Shanghai, and Hangzhou. After Taobao packages arrive, consumers can choose to deliver them to their homes or to their homes. The inn mentions itself.
The relevant staff of Cainiao Network explained to the Red Star Capital Bureau: “The goods purchased by users on Taobao and Tmall can be delivered to the door by the staff of Cainiao Station. Taobao will provide corresponding subsidies to Cainiao Station for the resulting distribution fees. ."
The outside world interpreted this as that Taobao assisted the Tongda system and competed with SF Express, JD.com, and Extreme Rabbit by improving user service differentiation.
However, Chen Ning was unhappy. He worried that the subsidy was only temporary, but the labor and time cost of home delivery was very high. If the subsidy stopped, he would face more tasks or be complained again. select.
Express station
Low-cost competition continues, but the headquarters fines are not reduced. Now more and more express franchise outlets are losing money.
Similarly, Liu Bin, who runs an express delivery station in Chengdu, also faces frequent deductions. “As long as users complain, the company will fine. I am now fined more than 1,000 yuan every month.” In addition to being fined, the express network franchise model Under the circumstances, the couriers are also facing precarious situations. Previously, it has been exposed many times that the express outlets could not send wages.
Behind this, there is an inseparable relationship with the asset-light model of the franchise system.
The asset-light model is conducive to the rapid expansion of the company in the early stage, but it is not conducive to the later management.
Boss Liu of the express station told the Red Star Capital Bureau: “The low-price competition continues, but the headquarters fines are not reduced. Now more and more express franchise outlets are losing money. For example, there can only be 10 complaint indicators per day in an area. , As long as it exceeds the limit, it will be fined, and if it is not handled well, it will lose money.
When will the fine be imposed?
The courier of Jitu Express told the Red Star Capital Bureau in Baiyu: "Loss of the package, exchange of packages and damage to the packaging may all be fined. Our couriers have to bear a lot of risks." Jitu Express where Baiyu is located is regarded by the outside world. "Pinduoduo is a courier company."
"Jitutu has a lot of e-commerce orders with Pinduoduo, the unit price is relatively low, many of which are 1 RMB 2 things, but when they encounter complaints, the fines are up to thousands of yuan." Baiyu said.
Lin Feng, the person in charge of Chengdu Suxi Logistics Distribution Center, believes that if the express war continues for a long time, all express companies will lose profits.
But he also pointed out another problem: "The lower the salaries of express employees will result in serious losses. Without employees, the outlets will also be affected. The next level that affects the company's headquarters is the company's headquarters."
Bai Yu also obviously feels that there has been a lot of loss of couriers recently: "The headquarters is focusing on service, but the pressure is passed on to the couriers layer by layer."
Courier company
On the one hand, the market value of the top express delivery company has soared, and wealth has soared, on the other hand, several second-tier express companies are in a dilemma.
In 2016, courier giants ringed the bell for listing one after another.
Now five years have passed. SF Express President Wang Wei, Zhongtong Express Chairman Lai Meisong, Yunda Co., Ltd. Chairman Nie Tengyun, and YTO Express Chairman Yu Weijiao have accumulated huge wealth and have been listed on the Forbes Rich List.
Among them, Wang Wei of SF Holdings is far ahead with a wealth of 214.85 billion yuan, ranking first in the express delivery industry.
Established in 2015, Jitu has entered the Chinese market for just over a year, and has become a spoiler in the express delivery industry with a multi-style approach. It has quickly reached the scale that the Tongda department has spent more than ten years in exchange.
According to industry insiders, the daily order volume of Jitu Express reached 20 million in January this year.
And just raised 1.8 billion US dollars, the valuation has reached 7.8 billion US dollars, second only to SF Express and Zhongtong in market value.
Unexpectedly, the price war started by Extreme Rabbit, but SF Express had the strongest response.
A few days ago, SF Holdings (002352.SZ) had a thunderstorm in its first-quarter performance, with an estimated loss of 900 million to 1.1 billion yuan. In the same period last year, it also had a net profit of more than 900 million yuan under the influence of the epidemic.
After the announcement, the one-word board of SF Holdings fell to the limit. Chairman Wang Wei apologized at the shareholders meeting that evening, and said that "this kind of problem will not occur a second time."
The head express company SF Express is like this, but what about the tail express company?
According to media statistics, from 2018 to the present, 12 second-tier express companies have been stuck in a dilemma, of which 6 express express, Guotong express, and Quanfeng express have been completely eliminated.
Today, the giants at the cusp of the storm dare not relax, and there is still a long way to go if they want to sit back and relax.
Chengdu Commercial Daily-Red Star News reporter Xu Yuan, intern reporter Qiang Yaxian
Express price war
when
Flameout
On April 9, Yiwu Post Office punished two express delivery companies, Jitu and Best, for low-price dumping.
Some of the distribution centers of these two express delivery companies in Yiwu were also suspended for rectification.
On April 14, a salesperson in the Yiwu area of Jitu revealed to reporters that Jitu has four or five distribution centers in Yiwu. Currently, only one of them is out of service and can be shipped normally without being affected by penalties.
"Now the lowest price of Extreme Rabbit is 1.5 yuan per order, and the above controls are very strict, but before the penalty is 1.2 yuan per order, 1.3 yuan." Chen Tao runs a warehouse in Yiwu with a storage area of 100,000 square meters.
Yuncang can be simply understood as a third-party organization that provides services such as packaging, shipping, and storage to businesses, especially small businesses.
Chen Tao revealed, "Yiwu Post Bureau requires that the unit price of each express company shall not be less than 1.4 yuan. As long as the price of the face order is less than 1.4 yuan, it will be sealed up. No matter it is Yuncang or Jitu’s own channels, they dare not report low prices. Now, even if there is no business."
In an interview with reporters, Zhao Xiaomin, an express logistics expert and CEO of Guanshu Enterprise Management (Shanghai) Co., Ltd., said that a long-term price war will bring about a vicious circle that will damage consumers and couriers.
"Price wars will inevitably bring about fluctuations in express delivery outlets, which means that the end of express delivery is unstable. The direct response is the decline in the income of the couriers and the decline in service quality, and ultimately the loss of users." Zhao Xiaomin said.
When will the price war end?
CITIC Securities predicted in a report that the fierce price war will continue throughout 2021.
"Before the general pattern of the industry is determined, any price truce will prove to be invalid."
Lai Meisong, chairman of Zhongtong Express, said at the end of 2020 that with the progress of the differentiation of express delivery companies, the "price war" will slow down and even an inflection point will appear.
As for when the turning point will come, Lai Meisong believes that it will still depend on the market input of leading companies' production capacity, but "this point of time will not wait too long."
Zhao Xiaomin predicts that the price war in the express delivery industry will come to an end at the end of the second quarter of 2021.
"It is mainly based on the analysis of the changes in the market share of express delivery companies. At present, there is no greater improvement. At the same time, the instability of terminal outlets and couriers caused by price wars has seriously affected the user experience." Zhao Xiaomin said, "Price wars At a certain stage, there will be a critical point. For example, express delivery companies continue to cut prices, and business volume does not rise but decline; for example, the number of outlets fluctuates and the scale of fluctuations becomes larger and larger, and the loss of control is a sign of the arrival of a price war.
According to Sino-Singapore Jingwei Client