According to an index report on China’s parcel delivery sector for November 2024, released by the State Post Bureau on Dec. 10, the number of parcels handled by the industry was expected to exceed 17 billion in November, with a record of 150 billion parcels hit for this year.

Robust growth

The rapid growth of China’s express delivery industry over the past decade has been staggering. In 2014, the industry handled approximately 14 billion parcels, marking the year China surpassed the United States as the largest delivery market in the world—a position it has maintained ever since. This year’s milestone of 150 billion parcels represents a more than tenfold increase in just 10 years.

According to Gui Ning, vice president of J&T Express, China’s logistics market accounted for over 60 percent of global parcel volume last year, processing more parcels than the next nine countries combined.

China has established the world’s most accessible, inclusive, and expansive delivery network, benefiting the largest number of people globally, noted Liu Jiang, director of the department of strategic planning at the Development and Research Center under the State Post Bureau.

By the end of 2023, a total of 289,000 village-level parcel delivery logistics service stations had been established, extending delivery services to 95% of the administrative villages nationwide. The industry has also made significant strides in infrastructure development, with numerous delivery hubs and logistics parks alongside nearly 2,000 sorting centers of the designated scale and above. These centers have largely automated parcel sorting, substantively boosting overall processing efficiency.

Moreover, the parcel delivery industry is deeply integrated with the broader transportation network. By 2023, over 170 cargo planes had been in operation for domestic deliveries, while railway shipments continued to grow. The overall transportation efficacy and reliability keeps increasing.

Liu said that major delivery companies have accelerated their transition to integrated logistic service providers, relying on their delivery networks to expand into express services, cold chain logistics, smart storage, and modern supply chain management.

So far, eight major delivery companies and a dozen downstream enterprises of the industrial chain have successively entered the capital market, as China Post and SF-Express have made it onto the World Top 500 list. The service quality of these enterprises has steadily improved, with parcels now typically delivered within just a few days across most of China. Liu added that the satisfaction with delivery services has remained high and is steadily rising, enhancing the people’s sense of gain and happiness.

Multifaceted reasons

Several factors contribute to the remarkable growth in China’s parcel delivery volume, both monthly and annually. Ding Hongtao, director of the legal affairs division of the China Express Association, identified strong legal and policy support as the first key driver. Since the 18th CPC National Congress, delivery enterprises have embraced many favorable policies that provide solid guarantees for growth.

Continuous infrastructure development has also played a crucial role, Ding added. The rapid expansion of expressway, railway, and water and air transport infrastructure has made same-day or next-day delivery widely achievable.

Another factor is the improved integration of the delivery industry with manufacturing. In recent years, the diverse demands of the logistics market have prompted delivery companies to move beyond the traditional “node-to-node” transportation model, increasingly embedding their services into manufacturing facilities, and even onto production lines, Ding said.

In addition, Ding noted, the synergistic development of e-commerce and logistics has been pivotal. Currently, over 80% of parcels in China stem from the e-commerce sector, with the two industries mutually reinforcing and accelerating each other’s development.

Ding also pointed to the role of direct financing in spurring the sector’s vigorous growth. Access to capital markets allows delivery companies to secure funding essential for expanding businesses, scaling up operations, building infrastructure, and advancing technology. Going public not only signals more financing opportunities but also incentivizes companies to innovate in management and operations, enhancing business growth, international reach, and intelligent development, he said.