FEaTuRE Logistics
Pickup
Branch Station Line 2 Station Branch Delivery
Line 6 Station Delivery
Flow chart explaining Station Branch Station
Kuaidi delivery System
their eyes to Shanghai, I sent two of my lo- Ave. commercial districts produce volume its first sort, in which the office determines
cal staff to check out the express delivery from the line 2 start point at Century Av- the package near or long distance. If near,
program and report back to me just how the enue to its midpoint at Loushanguan Road/ the package is taken to the corresponding
system worked. To work out not only the lo- Zhongshan Park areas. A decent majority branch for processing, and then carried by
gistics behind the network (my original inter- also moves along line 1 to the Xintiandi and another runner to that area. Each runner will
est), but to see how the various actors made Xujiahui areas as well. So, what you have are have a territory much like a standard delivery
money (my initial assumption was that they major delivery hubs that are spread out along service provider. If the package needs to be
were all independents) and how much money those stations including Dongchang Road, moved from the immediate area (across town
was moving through the system. People’s Square, Nanjing West Road, Zhong- or across China), it enters a different system
shan Park, and so on. (see flow chart).
Structure:
Contrary to my initial thoughts, the first The Flow: The Costs:
day showed that the system is quite orga- Moving a few thousand packages a day Anyone who has used a kuaidi service
nized, and that there are three to five compa- over a network of around 15 people requires provider knows that everything is negotiable
nies who are largely in control of the majority a semi-manageable process. Contrary to my from price to speed, and that this pack-
of packages (there are some independents). initial assumptions, this process is one that age delivery market is incredibly cut throat.
Much like any other firm, these groups have is actually tracked over the entire process While studying the traditional express market
developed a networks of branches to service through hand notes and a scan once it reach- several years ago, we were locally very inter-
their high traffic areas. es the express branch. ested in seeing how these smaller delivery
Line 2 is the money line. Hongqiao, Nan- Once received at the express office, the groups worked so well. It ended up all relying
jing Road, the Bund, Lujiazui, and Century package essentially enters the system and hits on word of mouth and mobile phone con-
versations. Therefore, the best express sales-
people always give secretaries and offices the
best discount.
Outside of this bargaining, the kuaidi
service is a geography based system (no sur-
prise) and the distance determines the speed
of delivery (no surprise there either). For
intercity deliveries, sending before lunch will
essentially guarantee a same day delivery, but
anything after lunch will “depend” on a few
different factors (you can pay extra for prior-
ity service with some providers). For service
outside of Shanghai, it appears that any 2nd
or 3rd tier city can be serviced next day, but
anything beyond that was anyone’s guess (I
once sent a package to the furthest reaches
of Jiangxi province that took 3 days).
So there you have it. Shanghai’s kuaidi
network exposed in detail as an intricate
network that utilizes both their own motor
power plus the vast resources of Shanghai’s
vast underground network.
China’s Kuaidi Service has different district price ranges for delivery.
www.chainaonline.com JANUARY/FEBRUARY 2010 51
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