Logistics companies in China are benefiting from a stabilising economy according to the latest figures published by the government's National Development and Reform Commission. Logistics companies moved products valued at ¥163.4trillion ($25.96bn) between January and November, a rise of 9.7% year-on-year.
This increased activity translated into higher revenues with turnover increasing by 6.8% in the period January to October, year-on-year. This is compared to a 3.4% growth in the first nine months.
However, companies have reported that operational costs have outpaced the rise in revenues. Total logistics costs have soared by almost 11.9% year-on-year to ¥8trillion from January to November. Recent tax reforms have also had a negative impact on costs, with many operators complaining that the new value-added tax regime has increased burdens rather than reduced it.
The endemic situation of increasing costs has led both the Ministry of Commerce and the State Council to announce initiatives like abolishing some road tolls which form a major element of Chinese transportation costs. Government officials refer to the logistics sector as a 'bottleneck' inhibiting both domestic and international trade.
The inability of the domestic industry to keep pace with demand was highlighted by the November 11, 'Single's Day' Internet shopping peak, when many logistics companies failed to cope, leaving consumers disappointed.