As Chinese e-commerce grows, logistics companies need to adapt
As online retailing rapidly expands, warehouse businesses need to adjust their strategies
By 2015, China will be home to more than 700 million internet users compared to 500 million today, making it the biggest online population in the world.
The internet is already an integral part of the retail experience for many Chinese consumers, if not for the actual purchase then for conducting research and price comparisons.
In fact, online retail sales in China have grown at a rate of 99 per cent per year over the past five years, compared to only 9 per cent in the United States. And in just one day in 2012 (November 11, known as "Singles' Sunday"), China's e-commerce market giant Taobao and its B2C (business-to-consumer) platform Tmall generated gross sales in excess of 19.2 billion yuan (HK$23.7 billion), 21 times the daily retailing volume of Hong Kong.
As with most things in China, the numbers are staggering. Yet they are far from reaching their full potential. At 37 per cent, internet penetration is still well below that of developed markets, and of this 37 per cent, only one in three are using the internet to shop online.
Estimates show that 30 million consumers, the equivalent of the population of Canada, are expected to make an online purchase for the first time in every single year to 2015.
The online shopping model adds a new dimension to the traditional retail experience, with in-store shopping substituted by direct delivery to consumers' homes.