A delivery man for Coupang Corp., South Korea’s leading e-commerce operator, loads a parcel delivery truck in Seoul on Aug. 8, 2018. (Yonhap)
SEOUL, Jan. 15 (Korea Bizwire) — The delivery market is bracing for Coupang Corp.’s move to jump into the delivery business.
Coupang Logistics Service, a subsidiary of South Korea’s leading e-commerce operator, was recently certified by the Ministry of Land, Infrastructure and Transport to engage in cargo distribution business.
Coupang Logistics acquired distributor certification by the ministry before the company retracted it in 2019. The company will now be in charge of Coupang’s ultra-fast delivery service “Rocket Delivery” temporarily.
Thus far, Coupang has been hiring subcontractors to carry out its rapid deliveries. Now, some of the delivery quotas will be transferred to Coupang Logistics.
In the long term, Coupang Logistics aims to become a ‘normal distributor’ capable of delivering parcels not just for Coupang, but also for other online shopping malls.
The delivery industry isn’t expecting a major impact at this moment.
Coupang’s Rocket Delivery system, boasted as the company’s core strength, works on Coupang’s pre-purchased inventory stored in its warehouses for quick delivery.
Since business-to-customer delivery also requires the company to collect and sort products coming from other warehouses, however, industry experts believe that it will take some time for Coupang to come up with such a system.
This Sept. 23, 2020, file photo shows CJ Logistics workers busy at a terminal in Gimpo, outside of Seoul, ahead of the annual Chuseok holiday. (Yonhap)
Some hope that once Coupang jumps into the delivery business, it will effectively reduce the excessive workload currently borne by delivery personnel.
Coupang, applying for cargo distributor certification last October, vowed to hire delivery staff directly, ensuring a 52-hour, five-day workweek and more than 15 days of leave each year.
Soon, however, the company deviated from earlier vows and had delivery staff choose between remaining as subcontractors or being employed directly.
Normally, delivery workers can make more money as subcontractors, rather than being directly employed.
As a result, many experts believe that Coupang Logistics will tread a path similar to other delivery companies in the future.
H. M. Kang (hmkang@koreabizwire.com)
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