E-commerce Logistics on Fast Growth Track

In recent years, China's e-commerce has entered a period of great-leap-forward development over continuous exploration and adjustment. Since 2002, e-business market kept a steady development momentum, and the transaction volume of e-business kept a rapid increase. In the first half of 2007, the transaction volume of Chinese e-business market had exceeded RMB1.32 trillion yuan, much higher than the total transaction volume of 2006, which was RMB1.1 trillion yuan. With the quick expansion of e-business market, various e-business innovations appeared one after another. In B2B, B2C, and C2C industries, e-business developed with various characteristics.

The integrated scale of e-business has been expanded

China Logistics Development Report published by China Federation of Logistics and Purchasing indicates that 2007 was a thriving year for Chinese e-business development. B2B e-business market became a focus in industry with the IPO of Alibaba. In 2006, China's B2B e-business transaction volume was RMB995.7 billion yuan. In 2007, it increased by as high as 25.5 percent, amounting to RMB1.25 trillion yuan. In 2007, the business income of China's B2C e-business market reached RMB5.22 billion yuan, 33.5 percent up than 2006. In 2007, China's C2C e-business market kept a rapid increase and the transaction volume reached RMB41.04 billion yuan, 90 percent up than 2006. The overall sales scale has been expanded substantially.

Among China's B2B e-business market, the third party information centered B2B e-business platforms, which was represented by Alibaba, grew fast in the last few years. They conformed to the trend of the development of Chinese manufacturing and service industries, and helped many Chinese SMEs to realize the dream of entering the international market. On November 6, 2007, when Alibaba was listed officially, only the transaction of the first day soared to the height of US$20 billion.

The transaction-centered markets represented by Shanghai Steel Exchange Center also developed quickly. In 1992, China Cocoon & Silk Wholesale Market (www.pfzn.com) was set up. Guangxi sugar and Jilin maize industry entered such a market, and the subsequent China Sugar Market (www.chinasugarmarket.com) and Zhejiang Yuyao Plastic Net (www.cp-city.com) were established. At present, there have been more than 200 bulk commodity exchange e-markets, involving many commodity sectors like petroleum, chemicals, steel, plastic, sugar, and rubber.

In China's B2C e-business market, vertical B2C traders developed soon in 2007. Such B2C traders as Shanghai NewEgg E-Business Co., Ltd (www.newegg.com.cn), Beijing Redbaby Information Technology Co., Ltd. (www.redbaby.com.cn), and Beidouxing Communications Appliances Co., Ltd. (www.139shop.com) have increased relatively fast in the fields of IT products, mom and baby products, and telecommunications and digital products. In 2007, competition was fierce in China's C2C e-business market with a comparatively high aggregation level. Taobao (www.taobao.com) took a leading position in aspect of business innovative capability, and ranked first in the first three quarters of 2007 with the market share of 74 percent, 83 percent, and 85 percent respectively.

Auxiliary environment system construction has made progress

As to the construction of modern logistics and distribution system, many B2B e-business markets have their independent logistics, storage and distribution system. For instance, China Taiyuan Coal Exchange Center (www.ctctm.com) develops its business with a three-level logistics and distribution system. With the expansion of business scale, the logistics and storage facilities are also improved. Some large-scale B2C e-business websites also have their own logistics, such as dangdang.com and joyo.com. To expand quickly, Dangdang made a large-scale reconstruction of its previous logistics system in 2007. However, the logistics and distribution of most e-business companies are conducted by the third party logistics companies. For instance, Alipay, Tianjin DTW and ZJS Express set up the first e-business third-party logistics ally in China in June 2005. In December 2005, AirFex joined in, and the ally launched "Recommended Logistics Indemnity System" on the basis of "Full-amount Indemnity". In December 2006, Alibaba and China Post jointly launched "E-business Express", which was implemented officially as of January 10, 2007.

Mobile e-business development has a broad future

Network carriers expanded their services and competition to the logistics informatization application market to seek for new business increase point. For instance, China Unicom launched a professional service brand "New Logistics Horizon", China Mobile launched mobile informatization solution of logistics industry, China Netcom made a logistics solution through tailor-making and integration with the supply chain management as the core, and China Telecom launched a "One-stop Service", alternating traditional logistics with information technology. The combination of mobility and logistics showed the new trend of logistics informatization.

Mobile e-business refers to the e-business system combined by mobile communications devices (like cell phones, beepers, PDAs, and notebooks) and wireless internet access technology. In recent years, the maturity of WAP, 3G and other mobile communications technologies, and the appearance of such mobile terminals as laptops, cell phones and PDAs have driven the development of mobile e-business market. In 2007, UFIDA developed hapigo (www.hapigo.cn), the first large-scale mobile business platform in China; Ma Yun registered all the wireless websites of its products and companies, planning to enter the mobile e-business market. The above-said two events had brought a vivid illustration of the mobile e-business development in China.

Meanwhile, the steadily increasing subscriber number of China Mobile has also laid a solid foundation for the development of mobile e-business. By the end of 2007, the number of mobile terminal (including PHS) users in China had been over 600 million, accounting for one fifth of the total number of global terminal users, which was 30 million. China's mobile netizens had increased by 167 percent than 2006, and 28.9 percent of internet users got online with cell phones. These are all potential customers of mobile e-business.

Industrial experts put forward that China's e-business market have a large space and bright future, but due to the restriction of such aspects as mobile communications carriers, banks, businesses and the personal conditions of mobile e-business service users in the recent period, it still needs time for China's mobile e-business to be mature.