【Industry Analysis】The Future for Freight Forwarding Companies in China

Since the reform and opening up, China's international freight forwarding industry ushered in rapid development, which plays an essential role in expanding foreign trade, attracting foreign investment, improving employment, promoting China's third-party storage software development and other aspects played an important role. Now, with the implementation of the "Belt and Road" strategy, cross-border e-commerce is booming, and the development of international freight forwarders is expected to enter a new chapter.  

International freight forwarder is born for the circulation of goods in international trade. According to statistics, 70-80% of the global cargo transportation is undertaken by international freight forwarding enterprises.  

Before the reform and opening up, China's international freight forwarding industry was strictly controlled and not fully developed. After the reform and opening up, the Chinese government gradually opened up the administrative management of international freight forwarding, and the international freight forwarding industry ushered in rapid growth.  

According to the Analysis report on Market Foresight and Investment Strategy Planning of China's International freight Forwarding Industry released by Qianzhan Industry Research Institute, by the end of 2014, the number of employees of China's international freight forwarding industry reached about 2.5 million, with a strong momentum of development. At the same time, the belt and Road Initiative and the continuous development of ERP in cross-border e-commerce have provided sufficient growth impetus for the international freight forwarding industry, and the future prospects are promising.  

However, the international freight forwarding industry has certain limitations in achieving further development. On the one hand, the international freight forwarding system is a pure service industry, which is closely related to service quality, geographical location, interpersonal relationship and past history. As a result, there are more small and medium-sized freight forwarding companies than large freight forwarding companies.

On the other hand, international freight forwarding companies are required to cooperate with one another, rather than only focusing on competition. For international freight forwarding enterprises, it is increasing important to achieve business complimentary, information sharing and freight network sharing among different countries, regions and enterprises.

Against this background, there show four main development trend in China's international freight forwarding industry.

First, large-scale application of Internet information technology to increase the scope and efficiency of sharing and cooperation. The integration of physical logistics network and intangible information network can be realized by using modern information technology.  

Secondly, continuous extension of the industrial chain. Freight forwarding enterprises with strong strength will inevitably extend to logistics transportation, supply chain management consulting services and other businesses to improve competitiveness.  

Third, pursuit for specialization, refinement and specialization. With the increasingly fierce market competition, how to stand out has become the primary consideration of many small and medium-sized international freight forwarding enterprises. Accordingly, strengthen specialization, fine, characteristic change is inevitable move.  

International freight forwarding industry has been accelerating to achieve integration, especially for companies with geographical connection, regional concept, social relations and other similarities. Undoubtedly,the accelerating of the integration will promise a bright future for the international freight forwarding industry.