S.F. Express has set up more than 50 overseas warehouses worldwide, covering 20 mainstream countries including the United States, Canada, Australia, Japan, the United Kingdom, Germany, Spain, and Czech Republic, and its overseas warehouse resources are abundant. Some experts believe that Cainiao's strategic goal is to serve Alibaba's e-commerce business, which is similar to JD Logistics' strategy within the JD Group.
On September 10, the Science and Technology Innovation Board Daily reported that Cainiao has made a new move in the cross-border logistics market.
According to the disclosure of the Competition Policy Coordination Bureau of the State Administration for Market Regulation, Zhejiang Cainiao Supply Chain Management Co., Ltd. (referred to as 'Zhejiang Cainiao') signed the 'Capital Increase Subscription Agreement' and 'Shareholders Agreement' with Shenzhen Rihai Technology Co., Ltd. (DSF), Shenzhen Shangcheng Investment Co., Ltd. ('Shenzhen Shangcheng'), and Quantium Solutions International Pte. Ltd. ('QSI'). Zhejiang Cainiao acquired 5.9459% equity of DSF through capital increase.
Established in 2004, DSF is headquartered in Shenzhen and positioned as a comprehensive global cross-border e-commerce supply chain service provider. It provides three main products including global express, overseas warehouses, and first-mile delivery based on the Global Parcel Network (GPN) and Global Fulfillment Network (GFN).
Currently, DSF has set up more than 50 overseas warehouses globally, with an area of over 1 million square meters, covering 20 countries including the United States, Canada, Australia, Japan, the United Kingdom, Germany, Spain, and Czech Republic.
Obviously, for Cainiao, which is expanding massively overseas, DSF's overseas warehouses alone are very attractive 'assets'.
It is worth noting that Cainiao strategically invested in DSF as early as 2016. Before this transaction, Zhejiang Cainiao, Shenzhen Shangcheng, and QSI held 45%, 30.0667%, and 19.7494% of DSF's equity, and DSF was jointly controlled by Shenzhen Shangcheng, QSI, and Zhejiang Cainiao. After this transaction, Zhejiang Cainiao holds 50.9459% equity of the target company, and DSF is solely controlled by Zhejiang Cainiao.
According to the 2023 report from the IoT Cloud Warehouse Digital Research Institute, ZTO Express, Sinotrans Limited, and DSF dominate the industry with revenues exceeding 10 billion yuan; while SF Express, YTO Express, Cainiao, and Winit have revenues ranging from 2 to 10 billion yuan. The rest are some small and medium-sized enterprises with revenues below 2 billion yuan, and they are the most numerous.
Wang Mingsheng, General Manager of Seagull International Logistics, stated in an interview with Star Daily that SF Express not only enjoys a large market share, but also provides solid support for Cainiao's global logistics blueprint with its strong brand value, extensive network coverage, professional talent team, and stable cooperative network.
According to Zhaoshi Consulting's forecast, the global cross-border e-commerce logistics market is expected to reach 2.3 trillion yuan by 2027, with a compound annual growth rate of 18.7% from 2023 to 2027.
Logistics giants such as SF Express, JD Logistics, and Cainiao are actively expanding overseas. It is worth mentioning that the cross-border logistics service field still presents a competition pattern of "large industry, small companies" with a relatively low market concentration.
"Through this acquisition, Cainiao Network's layout in the international logistics, especially cross-border e-commerce logistics field, has been strengthened, and it has gained a strong execution partner. This not only marks another important milestone in Cainiao's global strategy, but also indicates that its logistics plan will enter the fast lane of implementation and achieve more rapid development on a global scale," Wang Mingsheng further analyzed to the reporter of Star Daily.
In the perspective of express logistics expert and CEO of Guanshuo Capital, Zhao Xiaomin, Cainiao's focus is on internationalization. The acquisition of SF Express will further enhance its cross-border capabilities. From a strategic point of view, Cainiao aims to serve Alibaba's e-commerce business, which is consistent with JD Logistics' strategic positioning within the JD Group.