Surging Demand for Express Delivery Reveals Lack of Service Standards and Regulations

Anchor: Latest figures show China's express parcel delivery service topped 10 million pieces per day at the end of last year, ranking it the third highest number of deliveries in the world. But in the wake of the sharp increase, irregularities and a lack of service standards have become more obvious. While officials have announced plans to regulate the industry, insiders point out the reasons behind the problems. Wu Jia has the report.

A series of video clips that show some well-known domestic couriers mishandling express parcels has recently aroused public indignation.

Lost parcels and goods damaged in transit have turned out to be frequent occurrences. Worse still, nine out of ten complaints about such problems are in vain because of the absence of laws and regulations.

Wang Fushan, Deputy Secretary General of the National Consumer Complaint Center, says speed and safety are the two key characteristics of express delivery services. Yet regretfully domestic couriers don't do well in these respects.

He says last year they received more than 20,000 complaints about express delivery service, up 70 percent from 2009.

"Severe delay is a long-standing problem that takes up the biggest proportion of the complaints. The second highest proportion involves disputes over damaged or lost goods."

Statistics indicate that China has more than 10,000 express delivery companies, both registered and unregistered. Most of them have adopted franchising as their business model, because it's the most economical way to realize nationwide coverage.

But the low-input operation has directly resulted in couriers that are rich in number but poor in quality. Many of them have no fixed offices, no warehouses and no related equipment. All that they have is just a phone and a couple of runners going door-to-door on electric bicycles.

With the surge in online shopping, further limitations of the industry have come to light.

Xi Chunyang, President of the well-known domestic courier Shentong Express, says the huge market demand has greatly outpaced couriers' capacity.

"We expected to process 2 million pieces per day last year, but the actual amount reached some 2.4 million, which was more than we could deal with."

Faced with an increase in both demand and complaints, China's State Post Bureau has announced that it will formulate the industry by the first quarter of this year.

It's collecting internal regulations from foreign-invested, state-owned and private express delivery companies to draw up relatively balanced industry standards.

It has been reported that as part of the regulations, companies with a certain business volume will have to meet specific basic requirements such as having mail-sorting facilities.

Besides all that and taking the status quo of domestic couriers into account, there seems to be much more to do before

China's express delivery service is on track to healthier development.

For CRI, I'm Wu Jia.