Transportation Sector accounts for largest share in China Logistics Industry at RMB 7 Tn in 2020, while Warehousing and CEP are the fastest growing sectors basis revenue, as per a report by Ken Research
1. High Delivery Costs, Restriction on Trucks, Unforeseen Delays are some of the major Last Mile Delivery Problems faced in China.
Other Challenges in China Logistics And Warehousing Market
Low service level due to less trained delivery management personals. Empty Miles issue (15%-40% of total miles) leading to fuel waste, non-productive emissions, wasted driver hours and more.
The transportation mode is limited when it comes to small size delivery because FTL truck is no longer economical-friendly and environmental-friendly for delivering only several packages to different pin codes.
Time Windows for Delivery pre-arrangement do not guarantee the timely delivery to the customers owing to several issues such as wait time at different delivery points due to loading/unloading delays, retailer operational issues and more.
2. Implementation of Green Technology, Consolidated Shipping, Move Planning are few solutions to improve the overall efficiency in the logistics market.
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Most of the 3PL players are trying to shift towards green freight technology such as Electric Vehicles (witnessing a two-fold increase in logistics Industry each year) in China so as to avoid the unnecessary delivery delays due to complex environmental regulations and city restrictions in the country.
In consolidated shipping, large quantities of goods are shipped in smaller volumes and further transported after assembly for better rates and safety of goods. Bansar is one such consolidated shipping company in China which combines goods from several suppliers into a single shipment.
Cross docking is another way which Logistic players are adopting to solve delivery issues and move to more of a just in time inventory model in China.
3. Wider Investment in Modern Technology is the need of the hour- streamlining the process and improving overall efficiency
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Real-time tracking of fleet enables faster deliveries & monitoring fuel cost.
RFID tags can help companies to detect the location of their goods without the help of the staff thus, maintaining 95% accuracy in stock keeping.
Big data can help companies to determine the best routes for fleet as well as improve the efficiency of their drivers.
Truck Platooning to lower fuel cost and emissions. Improves Safety, reduces accidents, reduces labour cost and transports more quantity.