CJ Logistics Corp.’s terminal in Icheon, south of Seoul, is seen in this photo provided by the logistics company.
SEOUL, Aug. 18 (Korea Bizwire) — CJ Logistics Corp., a major South Korean logistics company, is consistently losing market share in the domestic parcel delivery service due to the active attraction of individual customers by e-commerce giant Coupang Inc.
As per CJ Logistics’ half-year report, the company secured a share of 44.3 percent in the domestic parcel delivery volume during the first half of this year.
The share has exhibited a continuous decline, dropping from 50.1 percent in 2020 to 48.3 percent in 2021 and further down to 45.7 percent in 2022.
The steady erosion of CJ Logistics’ market share can be attributed significantly to the rise of Coupang Logistics Service (CLS), a logistics subsidiary under Coupang.
According to the Korea Integrated Logistics Association, Coupang’s domestic parcel collection volume reached approximately 1.3 billion last year, accounting for 36.1 percent of the overall total.
Coupang’s parcel delivery volume is predicted to experience growth this year compared to the previous year.
The product commerce division of Coupang reported sales of US$5.7 billion in the second quarter of this year, marking a 15 percent year-on-year increase.
The count of “active customers,” denoting those who made at least one purchase of Coupang products within the last quarter, rose to 19.01 million in the first quarter of this year, reflecting a 5 percent year-on-year rise.
In the second quarter of this year, the count increased to 19.71 million, marking a 10 percent year-on-year growth.
However, some critics have highlighted that Coupang’s market share might have been overestimated due to the practice of “single item packaging” by CLS.
Unlike CJ Logistics, which consolidates products bought by a single customer into a box or plastic bag, Coupang adheres to the principle of individually packaging each item, even when customers purchase multiple units of the same item simultaneously.
J. S. Shin (js_shin@koreabizwire.com)
