STO Express "bans" Taobao? The marketing director came from Shanghai yesterday to "clarify": not a ban, but a temporary price adjustment.
In the past week, in the logistics recommendation forum of Taobao, posts like these have been everywhere: “STO Express, sellers are calling you to pick up express items.” “I placed an order three days ago, and until today no one has come to pick it up, it's really strong.” “Goods shipped on the 13th, still no sign of them yet…”
Subsequently, someone posted online that STO Logistics had stated that Taobao's price pressure was too intense, making it impossible to continue, and that STO would ban Taobao, with other logistics companies following suit to collectively raise prices. What is the truth?
Yesterday at noon, according to the phone number published online, I called STO Logistics' contact number in Hangzhou. The 811 customer service representative said that due to the heavy snow in the north previously, the backlog of goods was very serious. In order to deliver them as soon as possible, they were temporarily not accepting new orders. Subsequently, I also called several business halls of STO Express within the city, and received similar answers.
Yan Qiao from Taobao’s PR department expressed three points regarding the news that STO would "ban" Taobao. First, STO's current cooperation with Taobao is normal. Second, freight charges are market behavior, agreements between logistics companies and sellers, and "Taobao" cannot set prices or profit from them. Currently, there are more than ten logistics companies serving sellers on the Taobao platform. Even if STO exits, it will not affect Taobao users. Third, the heavy snow in the north has greatly impacted express delivery, which is an uncontrollable weather factor. All logistics companies are actively dealing with the situation, hoping that sellers and buyers can patiently wait.
To clarify the "rumors", Xia Zubin, the marketing director of STO Logistics, came from Shanghai to Hangzhou early yesterday morning and accepted an exclusive interview with our reporter. Xia Zubin said that in August 2007, STO Logistics officially entered Taobao's recommended logistics platform, and at that time, its only competitor was YTO Express. Currently, Taobao's business volume accounts for about fifty to sixty percent of STO's total business volume. Such a large market could not be easily "banned". The trigger for the "ban" claim was the heavy snow in the north recently. Weather reasons led to interval transportation blockages, causing urban end distribution to burst. Now, all employees of STO across the country are working 24 hours a day to figure out ways to transport goods, and all employees are working beyond their capacity. In such a situation, some major Taobao sellers may have jointly pressured prices, leading to some staff losing control of their emotions.
Although the "ban" claim is false, the news of price increases has been confirmed. Xia Zubin said that based on the current operation situation, starting from last Friday, the prices of some areas of STO Express have already been adjusted, including Zhejiang within the scope of price adjustments. It is hoped that this method will divert cargo and reduce transportation pressure. However, Xia Zubin emphasized that price adjustments are special measures during special periods, and if the postal routes smooth out, previous freight rates will be restored.
The heavy snow in the north triggered a wave of price increases in the express industry. Although STO does not consider this a ban event, it highlights the mismatch between e-commerce and logistics enterprises. The heavy snow weather recently just accelerated the outbreak of this contradiction. Unfortunately, in response to this contradiction, some logistics enterprises mechanically use "price levers" to take price increase measures. But the ultimate resolution of the contradiction obviously requires the birth of more truly modern logistics enterprises.
Cargo backlogs force courier price increases
"Doing business is key to making money, and obviously unprofitable businesses won't be done." Many express companies expressed this attitude during interviews. At the same time, I learned that besides STO raising prices, other express companies were also following suit. The heavy snow in the north caused many express companies' businesses to nearly collapse, warehouses overflowed, and many express companies took the opportunity to raise prices.
On November 15, Aunt Wang sent down jackets to her son studying in Xiasha, Hangzhou, from Ningbo via YTO Express. However, by the time the weather started warming up, the clothes had not arrived. Upon checking the tracking number, the clothes were delivered to Hangzhou the next day, but since then, they have been stuck in the Xiasha warehouse.
According to the contact numbers published online, I contacted YTO Express yesterday at noon. A staff member who answered the call said that the backlog of goods at various business outlets was very serious. They basically weren't taking new orders, and old orders would take some time to reach the recipients. However, I learned that YTO Express still secretly raised prices. Staff at the Chaowang Road branch said that now sending parcels from Hangzhou to Shanghai costs at least 8 yuan per piece.
Although this is true, this heavy snowfall really triggered the long-standing price increase intentions in the express industry. STO increased prices, YTO increased prices, and possibly following will be "Zhongtong," "Tiantian," etc. But can price increases really solve the current difficulties faced by express companies in handling the massive e-commerce business volume?
E-commerce encounters a logistics crisis
Recently, Taobao announced at the APEC SME Summit Logistics Forum that as of June 2009, the actual logistics demand generated through Taobao was 3 million orders/day, with a growth rate of 50% in just half a year. Now "online shopping" has transformed from a fashionable term into a part of daily life for many citizens.
However, along with the rapid development of e-commerce, the development of logistics enterprises lags behind relatively. Currently, competition among logistics enterprises is only at a low level of price competition, resulting in mutual losses. Simultaneously, all disputes surrounding express services inevitably harm consumers because, so far, China has no laws or regulations specifically targeting the express industry. Therefore, many companies absolve themselves of responsibilities through "tyrannical clauses."
Xia Zubin, the market director of STO Express, said that the company realized potential crises last year, but everyone was immersed in the good situation at the time. And those voices saying that logistics might severely impact the subsequent development of e-commerce were drowned out in laughter.
Actually, starting from the end of last year, logistics companies have been operating at full capacity. Affected by the financial crisis, the business volume of traditional business customers decreased in the first half of this year, but the actual logistics demand generated by Taobao increased by 100%. Various logistics companies began maliciously competing for Taobao business, competing to lower prices.
With the economic recovery in the second half of the year, most express companies already felt overwhelmed. Although the company invested heavily in manpower and vehicles for prevention this year, the final crisis still erupted. Price adjustments in certain regions by the company aim to divert cargo and relieve corporate pressure through such means.
Online shopping is developed, but logistics cannot keep up
Private express companies are inadequate, but can state-owned post offices make customers trustfully entrust their goods? Some emotionally charged express company employees used this sentence as a "threat" during interviews: "With such low profits, we might as well withdraw. Then Taobao will only find the post office, let's see how long it can hold up." On Taobao, numerous store owners almost unanimously expressed: do not recommend regular mail, do not recommend EMS, the reasons being too slow speed, too high price, completely unsuitable for the current needs of e-commerce development.
Yan Qiao from Taobao's PR department said that although currently the rapid development of e-commerce pulls, or even pushes, the logistics industry forward quickly, it still cannot be fully synchronized. But Alibaba absolutely cannot do logistics itself; it merely hopes to build a more perfect platform to promote the common progress of related industries. Professor Cao Weiguo from Hangzhou Dianzi University, who studies logistics, said that currently, our express industry and the development of e-commerce are fundamentally mismatched. Low-level competition is not the logistics distribution that modern e-commerce needs.
However, Taobao still has a pretty optimistic view on the future of the logistics industry. Yan Qiao said that although there are various problems during the rapid development of the logistics industry driven by e-commerce, they are all problems arising during development. The Chinese e-commerce market is so vast, growing so fast, that it is a must-contest territory for every express company. Rapidly developing markets and fierce competition will certainly accelerate the construction of software, hardware, and service quality for logistics companies. Some unqualified, unable-to-adapt companies can be eliminated, while some capable companies will surely stand out and successfully occupy the market. During this process, there will definitely be events like the current "cargo backlog" crisis, but the emergence of modern logistics companies suitable for Chinese e-commerce needs is just a matter of time.
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