Kerry continues building express platform

Kerry Logistics is planning to develop a regional express delivery platform in China and across the Asean region to capitalise on a rapidly growing segment of the logistics business, but will do so cautiously.


Kerry continues building express platform


Kerry Logistics is planning to develop a regional express delivery platform in China and across the Asean region to capitalise on a rapidly growing segment of the logistics business, but will do so cautiously. The first step in that direction took place when Kerry secured the first batch of courier licences late last year. The company expects to have the final licences by the end of this year that will cover 14 provinces and 19 cities.

“The situation in China in the courier market is chaotic, unregulated and in a cut throat price war,” Edwardo Erni, Kerry Logistics executive director and managing director of China and North Asia, said at the company’s 2014 results announcement.

The Hong Kong-listed logistics company reported healthy performance for 2014, ending the year with net profit up 10 per cent to HK$976 million (US$125 million) on the back of a six per cent rise in turnover to HK$21,115 million. The company’s integrated logistics segment posted 12 per cent year-on-year growth and the international freight forwarding division grew 11 per cent.

Kerry plans a cautious strategy for the China market, creating pilot projects within the next six months in the cities of Shanghai, Beijing, Shenzhen and Guangzhou. “We are targeting the tier one cities that have the volumes to support a trial run. The first tier cities are where the consumers are spending more. This year will be the reshuffling year of the courier market in China, phasing out the weaker players and the market will further consolidate. When it does, we will be ready to move in a big way.”