The Chinese express delivery sector traces its origins to the 1990s, when pioneering companies like SF Express and the Tonglu-based operators began shaping an industry that would later become integral to the nation's economic transformation.
In 1993, SF Express quietly established its operations in Shunde, Guangdong province. The company maintained an exceptionally low profile during its early years, with its office locations remaining virtually unknown to the public. Meanwhile, Nie Tengfei and his team of entrepreneurs from Tonglu County were making their mark through relentless effort and innovation, gradually gaining recognition in the emerging parcel delivery market.
The Boom Years
As China's economic reforms deepened, the proliferation of foreign trade companies created unprecedented demand for domestic delivery services. By the turn of the millennium, thousands of courier companies had entered the market. Enterprises like SF Express and ZJS Express emerged as significant players, each developing distinct business models and market strategies.
SF Express distinguished itself through consistent pricing and premium service quality, particularly through its expanding air freight network. This strategic focus positioned SF as a market leader. Concurrently, the Tonglu-based operators adopted a franchise model that enabled rapid expansion, capturing substantial market share through their flexible "dual-track" approach to competition.
Competitive Dynamics
The relationship between these two dominant forces featured both rivalry and cooperation. While SF maintained its service-oriented philosophy, the Tonglu network prioritized market share growth through its extensive franchise system and operational agility. Despite facing regulatory challenges from the state postal system, the Tonglu operators demonstrated remarkable resilience, gradually building brand recognition.
By 2005, intensifying competition led to significant industry consolidation. The Tonglu alliance continued gaining market presence while navigating the pains of sector restructuring. SF maintained steady growth, capitalizing on market opportunities while cultivating a strong corporate reputation.
Market Leadership
Ultimately, SF Express leveraged its financial resources and technological capabilities to become the industry leader. Yet the rise of the Tonglu operators remains an equally compelling story of entrepreneurial persistence. These parallel development paths illustrate the complexity and diversity of China's express delivery market. With e-commerce continuing to drive sector growth, the industry appears poised for further transformation and new opportunities in the coming years.
