跨境電商物流策略白皮書(shū)

EXPLORINGTHERIGHTLOGISTICSSTRATEGYFORCHINA-U.S.B2CCROSS-BORDERE-COMMERCE

whitepaper|march2023

TABLEOFCONTENTS

ExecutiveSummary4

Introduction5

Cross-BorderE-commerceinChina6

MarketOverview6

KeySalesChannels7

Cross-BorderE-commerceintheU.S.9

MarketOverview9

KeySalesChannels10

LogisticsModels12

Business-to-Consumer/DirectShipping12

Business-to-Business-to-Consumer13

ComparisonofLogisticsModels14

Cross-BorderShippingAlternatives16

PostalServiceProviders16

ExpressLogisticsProviders17

FreightForwardersandConsolidators17

LogisticsArmsofE-commercePlatforms18

LogisticsFlows20

PostalServiceProviders20

ExpressLogisticsProviders21

FreightForwardersandConsolidators22

E-commercePlatforms:Amazon(China-to-U.S.)24

E-commercePlatforms:Alibaba/Cainiao(U.S.-to-China)26

TrendsinCBECLogistics29

ExpansionofServiceOfferingsandGeographicFootprint30

IncreasedRelianceonAirFreight31

InvestmentinTechnologyandDigitalCapabilities32

Green-ShippingInitiatives33

SelectingaLogisticsStrategy35

FamiliaritywithTargetMarket36

DemandCharacteristics37

ProductCharacteristics38

DetailedAnalysis39

Conclusion40

STANFORDGRADUATESCHOOLOFBUSINESS|EXPLORINGTHERIGHTLOGISTICSSTRATEGYFORCHINA-U.S.B2CCROSS-BORDERE-COMMERCE2

AUTHORS

BarchiGillai

AssociateDirector,ValueChainInnovationInitiative

StanfordGraduateSchoolofBusiness

Email:

barchi@

HauL.Lee,PrincipalInvestigator

ThomaProfessorofOperations,InformationandTechnologyFacultyCo-Director,ValueChainInnovationInitiativeStanfordGraduateSchoolofBusiness

RESEARCHASSISTANTS

CarolineYuandiLing

MBA&MasterofScience,EnvironmentandResources

StanfordUniversity

TonyLianfengShan

MasterofScience,Management

StanfordUniversity

ArayaSornwanee

MasterofScience,ManagementScienceandEngineeringStanfordUniversity

ABOUTTHEVALUECHAININNOVATIONINITIATIVE

TheValueChainInnovationInitiativebringstogetheracademics,industryleadersandpractitionerstoadvancethetheoryandpracticeofglobalvaluechaininnovationthroughresearchandknowledgedissemination.

HousedwithintheGraduateSchoolofBusinessatStanfordUniversity,weseektounderstandtheeconomicandsocialimpactsoftheglobaldynamicsandtechnologiesthatarereshapingbusinesses,industriesandecosystemsacrossthevaluechain.

Ourresearchandprofessionalworkshopsfocusonaddressingproblemsthatarehighlyrelevanttothegreaterglobalbusinesscommunity,andcoverabroadrangeoftopicsincludingglobalsupplychaindesignincomplextradeenvironments,responsiblesupplychains,technologicalinnovationsandtheir

impactonvaluechains,andmore.

Learnmoreat

/vcii

.

STANFORDGRADUATESCHOOLOFBUSINESS|EXPLORINGTHERIGHTLOGISTICSSTRATEGYFORCHINA-U.S.B2CCROSS-BORDERE-COMMERCE3

EXECUTIVESUMMARY

Business-to-consumer(B2C)cross-border

e-commerce(CBEC)isthepracticeofconsumerspurchasinggoodsdirectlyfrommerchantslocatedinothercountries.

SoundlogisticsservicesarecriticalforsupportingCBEC,giventheimportanceconsumersplaceonsuchaspectsoftheshoppingexperienceasshippingtimesandcosts,visibilitytotheirgoodswhileintransit,andtheavailabilityofreturnservices.

GiventheimportanceofCBEClogisticsservicesandthecomplexityoffulfillingcross-borderorders,weofferinthispaperanoverviewofthelogisticsoptionsavailabletocross-bordermerchants.WefocusspecificallyonthelogisticsalternativessupportingtradebetweenChinaandtheU.S.—twodominantplayersintheglobalCBECmarket.

Atahighlevel,merchantscanconsidertwologisticsmodels:business-to-consumer(B2C),alsoknownasdirect-shipping,andbusiness-to-business-to-consumer(B2B2C).Merchantsshouldalsodecidewhethertofulfillcustomerordersfromtheirhomecountry,orfromafulfillmentcenterlocatedclosertotheircustomers.Eachalternativeoffersadifferentsetoftrade-offsbetweencost,risk,speedofdelivery,andoverallcustomersatisfaction.

Asforselectingthelogisticsprovider(s)topartnerwithforcross-bordershipping,keyalternativesincludepostalserviceproviders,expresslogisticsproviders,freightforwardersandconsolidators,as

wellasthelogisticsarmsofthelargere-commercecompanies.Thepaperoffersadescriptionofeachalternative,itsprosandcons,andthescenariosunderwhicheachalternativemaybemorerelevant.Wealsoofferadetaileddescriptionofthelogisticsflowsassociatedwitheachoftheseshippingalternatives.

Finally,wealsohighlightinthispapersomeofthewaysinwhichthelogisticslandscapehasevolvedinrecentyearsanddiscusshowthesetrendsarehelpingtoaddresssomeofthemainchallengessellersandbuyersengagedinCBEChavetraditionallyfaced.

Thelastpartofthepaperlaysoutourrecommendationsforhowmerchantsshouldapproachthetaskofdeterminingtherightlogisticsstrategyfortheirspecificbusinessneeds.Merchantsshouldbasetheirdecisionsonadetailedanalysisthatcomparestheexpectedcosts,revenues,andriskfactorsassociatedwitheachlogisticsalternative.Theyshouldconductthisanalysiswhiletakingintoconsiderationsuchfactorsastheirinternalexpertiseandfamiliaritywiththetargetmarket,expecteddemandpatterns,andthecharacteristicsoftheproductsthattheysell.

STANFORDGRADUATESCHOOLOFBUSINESS|EXPLORINGTHERIGHTLOGISTICSSTRATEGYFORCHINA-U.S.B2CCROSS-BORDERE-COMMERCE4

INTRODUCTION

Business-to-consumer(B2C)cross-border

e-commerce(CBEC)isthepracticeofconsumerspurchasinggoodsdirectlyfrommerchantslocatedinothercountries.Commonwaysforconsumerstoengageincross-bordershoppingisbyorderinggoodsdirectlyfrommerchants’ownwebsitesorthroughonlinemarketplaces.

Inrecentyearsonlineshoppershavebecomemorecomfortablewithcross-bordershopping,leadingtoasteadygrowthoftheglobalCBECmarket.Mostexpertsexpectthistrendtocontinueinthecomingyears.Accordingtoonemarketreport,theglobalCBECmarketisexpectedtoexpandatacompoundannualgrowthrate(CAGR)of17.4%,from$578.57billionin2019to$2,248.57billionby2026.1We’dliketocaution,though,thatwiththeworldpotentiallyedgingtowardaglobalrecessionin2023,2andwiththeworld’slargesteconomiesalreadyexperiencingasharpslowdown,theglobalCBECmarketmayendupexpandingataslowerpacethaninitiallyanticipated.

AsfortheimpactofCOVID-19onthemarket,whileearlyonthepandemicledtoasignificantincreaseinonlineshopping,cross-bordere-commerceexperiencedslowergrowthcomparedtodomestice-commercemarkets.Thiscanpotentiallybeattributedtoacombinationofgrowingsupportforlocalretailersanddisruptionstoglobalsupplychains.

Manycross-borderordersarerelativelysmallandinexpensive,asisillustratedbytheresultsofaglobalcross-bordershoppersurveybytheInternationalPostCorporation(IPC),3where43%ofordersweighedupto0.5kg(1.1lb)andathirdofordered

itemswerevaluedbelow€25(aboutUS$24.64).Someofthekeyreasonsforshopperstoordergoodsfromothercountriesaretheeasyaccesstoproductsandbrandsthatmaynotbeavailableattheirhomecountry,aswellastheabilitytopurchaseitemsatalowertotalcostcomparedtothepriceschargedatlocalstores.Atthesametime,shippinganddeliveryareimportantaspectsoftheshoppingexperienceandmayimpactthewillingnessofonlineshopperstopurchasegoodsfromforeignwebsites.TheresultsofaglobalsurveybysolutionproviderESWillustratethispoint,with27%ofparticipantsselectinglongshippingtimesandhighshippingcostsasthemainreasonsforthemtoavoidbuyingcross-border.5Inanotherglobalsurvey,abouttwothirdsofrespondentswantedtheoptionoffreestandardshippingandidentifieddeliverytrackingandacleardeliverytimeframeasmotivatorstobuymore.6

Giventheimportanceandcomplexityofcross-bordershippinganddelivery,weofferinthispaperanoverviewofthelogisticsoptionsavailabletomerchantsengagedinCBEC.Wespecificallyfocusonthelogisticssolutionsavailabletosmallandmedium-sizecompanies,whichrepresentalargeshareoftheCBECmarket.WefurtherofferourobservationsoftheevolutionofthelogisticslandscapeinrecentyearsandthewaythesechangesarealleviatingsomeofthehurdlestraditionallyfacedbymerchantsandshoppersengagedinCBEC.

ChinaandtheU.S.arethetwoleadingcountriesintermsofthedollarvalueoftheirB2Ccross-bordere-commerceexports.7Furthermore,a

1“

GlobalCross-BorderE-commerceMarket-SegmentAnalysis,OpportunityAssessment,CompetitiveIntelligence,IndustryOutlook

2016-2026

,”AlltheResearch,Feb.2021.

2“

RiskofGlobalRecessionin2023RisesAmidSimultaneousRateHikes

,”TheWorldBank,Sept.15,2022.

3“CrossBorderE-CommerceShopperSurvey2021:KeyFindings,”IPC,Jan.2022.

4BasedonOct.17,2022exchangerate.

5“GlobalVoices2022,”ESW,accessedOct.17,2022.

6“

GlobalVoicesPre-PeakPulse2021

,”ESW,Sept.17,2021.

7“

EstimatesofGlobalE-Commerce2019AndPreliminaryAssessmentofCovid-19ImpactonOnlineRetail2020

,”UNCTAD,accessedOct.19,2021.

STANFORDGRADUATESCHOOLOFBUSINESS|EXPLORINGTHERIGHTLOGISTICSSTRATEGYFORCHINA-U.S.B2CCROSS-BORDERE-COMMERCE5

significantportionofthisglobaltradetakesplacebetweenthesetwocountries,asindicatedbyseveralconsumersurveys.TheypointtoChinaastheforeigncountrymostU.S.onlineconsumersshopfrom,andtotheU.S.asoneofthetopthree

countriesChineseshoppersbuyfrom.8,9DuetothehighCBECtradevolumebetweentheU.S.andChina,thepaperfocusesonthelogisticsflowsbetweenthesetwocountries.

CROSS-BORDERE-COMMERCEINCHINA

KEYPOINTS

?Retailcross-bordere-commercehasbecomeincreasinglypopularinChina.

?ManyofChina’sCBECshoppersarerelativelyyoung,welleducated,withmediumtohighincome.

?Onlyproductsonthe“PositiveList”canbeimportedintoChinathroughthischannel.

?Domesticandforeigne-commerceplatformsarethemostpopularsaleschannelsforCBEC.

?TheuseofsocialplatformsforCBEChasalsobeengainingmomentum.

MARKETOVERVIEW

Chinaistheworld’slargeste-commercemarket,accountingin2021formorethanahalf(52.1%)oftotalworldwideretaile-commercesales.10Chinaalsohasthehigheste-commercepenetrationrate,with46.3%ofthecountry’sretailsalestakingplaceonline.11Themarketcomprisestwokeysegments,domesticandcross-bordere-commerce,withthelatterbeingthefocusofthispaper.

RetailCBEChasbecomeincreasinglypopularinChinainrecentyears.Thisisdueinparttothewideselectionofimportedgoodsavailable,attractivepricing,andtheconvenienceofonlineshopping.Anotherpotentialcontributoristherapidgrowthof

China’sexpressdeliveryindustryanditsexpansiontosmallertownsandmoreruralareas.Accordingtosomeestimates,themarketreachedatotalof483.74billionYuan($76billion12)in2021,13with280millionbuyersexpectedtomakecross-bordere-commercepurchasesin2023.14Wecautionthoughthatsuchestimatesvarywidelyacrosssources.

B2Ccross-bordere-commerceisviewedinChinaasanimportantforcethatstabilizesthecountry’sforeigntrade.15Becauseofthat,ChinahasimplementedovertheyearsaseriesofpoliciesdesignedtoimprovetheregulationofCBECretailimportsandpromotethedevelopmentofthis

8“CrossBorderE-CommerceShopperSurvey2021,”IPC,Jan.2022.

9“TheGreatPivotinGlobaleCommerce:BorderlessCommerceReport2021,”P(pán)ayPal,accessedOct.17,2022.

10“

Top10Countries,RankedbyRetailEcommerceSalesShare,2021

,”InsiderIntelligence,May2021.

11“

Top10Countries,RankedbyRetailEcommerceShareofTotalRetailSales,2022

,”InsiderIntelligence,Jan.2022.

12Basedonthe

ChineseYuantoUSDollarspotexchangerates

onDec.31,2021,ExchangeR.uk,accessedFeb.1,2023.13“

MarketSizeofCross-BorderE-CommerceRetailImportsinChinafrom2016to2021

,”Statista,March2022.

14“

Cross-BorderRetaileCommerceBuyers,byCountry

,”InsiderIntelligence,Jan.2023.

15“

ChinaRemainsWorld’sLargestB2CCross-BorderE-CommerceMarket

,”P(pán)eople’sDailyOnline,July13,2021.

STANFORDGRADUATESCHOOLOFBUSINESS|EXPLORINGTHERIGHTLOGISTICSSTRATEGYFORCHINA-U.S.B2CCROSS-BORDERE-COMMERCE6

sector.16Atthesametime,callsbyBeijingtopromote“commonprosperity”andcurbexcessmayservetotonedownthehypeChina’sbige-commerceplatformshavebeenbuildingaroundcross-bordershopping.17SeveralotherexternalforcesmayalsoputadentonthegrowthofChina’sCBECmarket,at leastintheshortterm.TheyincludetheslowingoftheChineseeconomyduetoCOVID-zeropoliciesandstrictlockdowns,thecountry’srealestatecrisisandotherfactors,whicharemotivatingconsumerstocutbackdebtandincreasesavings.18

ManyofChina’sCBECshoppersarerelativelyyoung,welleducated,withmediumtohighincome.19Drivenbyadesireforhighqualityandauthentic

goods,someofthekeyproductcategoriesimportedthroughB2Ccross-bordere-commerceincludecosmetics,maternityandbabyproductsandhealthcareproducts.20

Notalltypesofproductscanbeimportedto

Chinathroughthischannel.In2016theChinesegovernmentintroducedthePositiveList,whichliststheproductcategoriesthatcanbeimportedintoChinathroughaCBECmodel.Whenfirstintroduced,thePositiveListcontained1,293categories,ofwhichabout360werefoodoragriculturalproducts.21Sincethenthelisthasbeenupdatedseveraltimes,bringingthetotalnumberto1,476categoriesbyFebruary2022.22

KEYSALESCHANNELS

Whenshoppingcross-border,Chineseconsumersaremostconcernedabouttheauthenticityoftheproductsthattheybuy,thereputationoftheshoppingwebsite,productvariety,price,andeaseofshopping.23Giventheseconcerns,itisnosurprisethatmostChineseconsumersprefertoshopcross-borderondomesticplatforms,withwhichtheyarefamiliarandthat

haveareputationforofferingauthenticproductsatcompetitiveprices.AccordingtoaniResearchreport,in202058.3%ofshoppersuseddomestice-commerceplatformsforcross-bordershopping.Anadditional19.1%shoppedthroughforeignplatforms.Only12.7%shoppedonofficialwebsitesofforeignbrands,andtherestshoppedinduty-freestoresorusedtheservices

ofshoppingagents(Daigou).24Thisdistributionrepresentsasignificantshiftfromseveralyearsagowhen,basedona2015survey,only46%ofshoppersusede-commerceplatformswhile29%shoppeddirectlyonforeign-brandwebsites.25Interestingly,theintroductionofthePositiveListin2016renewedinterestintheservicesofDaigouagents,sinceasaC2Cchannel,DaigouagentscanbypassthePositiveListwhichonlyappliestoB2B2CorB2Ctrade.26

Themostpopulardomesticplatformsforcross-borderimportsincludeTmallGlobal(39.6%oftotalvolume),JDWorldwide(25%),Kaola(20.1%),andVIPInternational(8.6%).27Someoftheotherplayers,

16C.H.Poon,“

ChinaUpdatesCross-BorderRetailImportPolicy

,”HKTDC,July22,2019.

17JoshHorowitzandBrendaGoh,“

FromSplurgeto‘CommonProsperity’:AlibabaTonesDownSinglesDay

,”Reuters,Nov.1,2021.18YujingLiuandTomHancock,“ThePerilsofChineseThrift,”BloombergBusinessWeek,Aug.22,2022.

19“

2021Cross-borderOnlineShoppingReport

,”iResearch,2021.

20

ForgingAheadAgainstHeadwinds:China’sImportedGoodsMarketResearch2020

,TmallGlobalandDeloitteChina,Nov.3,2020.21“

ChineseGovernmentPoliciesChangeforCross-Bordere-Commerce

,”USDA,Dec.7,2016.

22“

ChinaCross-BordereCommerce:“PositiveList”Helper

,”TMOGroup,accessedOct.19,2022.

23“

OnlineShoppingReport

,”iResearch,2021.

24“

OnlineShoppingReport

,”iResearch,2021.

25HauL.Leeetal.,“

U.S.-to-ChinaB2CE-Commerce:ImprovingLogisticstoGrowTrade

,”StanfordVCII,Aug.2016.

26“Cross-borderE-commercePositiveListPublished(AndItsExpansion),”EIBENS,accessedOct.19,2022.

27“

MarketShareofImportCross-BorderB2CE-CommerceRetailersinChinain3rdQuarterof2022

,”Statista,Nov.2022.

STANFORDGRADUATESCHOOLOFBUSINESS|EXPLORINGTHERIGHTLOGISTICSSTRATEGYFORCHINA-U.S.B2CCROSS-BORDERE-COMMERCE7

eachwithlessthan3%ofthemarket,includeAmazonGlobal,LittleRedBook,SuningGlobal,andXiaomiYoupinGlobal.Belowisabriefdescriptionforeachofthekeyplayersinthisfield.

TmallGlobal:Launchedin2014byAlibaba,TmallGlobalisChina’slargestcross-borderB2Conlinemarketplace.Asofearly2022,theplatformisinusebyover100millionactiveconsumersand30,000internationalbrands.28

Kaola:Foundedin2015byNetEase,thecompanywasacquiredbyAlibabain2019.IthasbecomeanimportantCBECunitofAlibabaandmaintainsitsindependentoperations.AsofAugust2022ithadover30millionactiveusers.29

JDWorldwide:LaunchedbyJD.comin2015,JDWorldwideoffersover10millionSKUs(stockkeepingunits)ofproductsimportedfrom20,000brandsallovertheworld.30JD.comhasover580millionactiveusers,allofwhomhaveaccesstoJDWorldwide.31

VIPInternational:Launchedin2014byVIPShop,whichisanonlinediscountretailerplatform.32In2021VIPShophad93.9millionactivecustomers,33withallofthemhavingaccesstoVIPInternational.

SOCIALCOMMERCE

Socialcommerce,whichistheprocessofbuyingandsellinggoodsthroughasocialplatform,isahugeindustryinChina.Accordingtooneestimate,

in2021theGrossMerchandiseValue(GMV)ofsocialcommerceinChinareached2,532billionyuan($398billion34).35Pre-pandemictheindustryhasbeenrapidlygrowing,almostdoublinginsizeeveryyear.ButtheCOVID-19pandemicdramaticallysloweddownthisexpansion,with2020and2021seeingagrowthrateof11.62%and10.09%respectively.36

Whilemuchofthegrowthhasbeenrelatedtodomesticshopping,socialcommercehasalsopenetratedCBEC.E-commerceplatformLittleRedBookhasbeenasocialcommercepioneer,gainingareputationforreliable,authenticproductreviewsandsuccessfullyintegratingbetweensocialmediaandretail.37JDWorldwidehasalsotakenadvantageofsocialcommercethroughapartnershipwithLittleRedBook.Underthispartnership,overseasmerchantscanoperateastorefrontembeddedinJDWorldwide’shomepageonLittleRedBookandthenuseJD’slogisticsnetworkfororderfulfillment.38OtherexamplesincludeTmallGlobal,whichamongotherinitiativeshasexpandeditsGlobalInfluencersprogramtosupportoverseasbrands,39andsocialmediaplatformWeChat,whichoffersoverseasbrandsawaytosellcross-borderthroughabrandedWeChatshop.40

28“

HowtoSellinChinaWithTmallGlobal

,”TMOGroup,March9,2022.

29

CompleteGuidetoSellingonKaolaforChinaCross-borderE-Commerce

,GMA,Aug.17,2022.

30RachelLiu,“

In-depthReport:JDWorldwideSixYearsandGoing:BridgingBrandsandCustomers

,”JD.com,April16,2021.31DorisLiu,“

JDWorldwideSalesJumpas618GrandPromotionKicksOff

,”JD.com,June3,2022.

32“

SellingonVipshopandVIPInternationalinChina