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Business

Japanese shippers vie to carry cross-border internet orders

Workers handle cargo at Nippon Express' logistics center at Narita Airport.

TOKYO -- Chinese consumers are on a shopping spree in Japan -- via the internet -- and the trend has Japanese logistics companies competing on speed and price.

In August, Nippon Express partnered with Chinese e-commerce giant Alibaba Group Holding to get Japanese goods to China. Since the partnership was formed, Hiroshi Uchikoshi, a Nippon Express manager, has been busy pitching major retailers. Nippon Express, he tells them, can get stuff to China for 30% less than rival Japan Post's Express Mail Service.

All the Japanese products being shipped to Chinese consumers have created a logistics bottleneck. Japan Post's EMS carries the bulk of the orders, but there have been delays during peak periods.

When Uchikoshi in spring visited Alibaba's headquarters, in Hangzhou, Zhejiang Province, a logistics executive asked if Nippon Express could handle 50,000 parcels a month -- and swiftly. Nippon Express, Japan's largest international cargo carrier, decided it could try and made a bulk purchase of cargo space in aircraft and on ships.

With reduced shipping charges, Nippon Express is hoping to entice new customers away from Japan Post, which in June raised its EMS rates to improve its balance sheet.

This past spring, Takuya Yoshino, assistant manager of the solution sales division at Yamato Global Logistics Japan, an international unit of Yamato Holdings, held a briefing for executives of Japanese companies. He stressed Yamato Global's trustworthiness and reliability.

Yamato in April teamed up with JD.com, China's No. 2 e-tailer, to help Japanese companies set up online stores on JD.com's web portal and ship products.

To facilitate customs and other procedures, the company obtains product information from companies in advance, then ships orders after checking on any export barriers and tax rates. A Chinese consumer can sometimes receive his or her order in four days.

In March, Akihiko Okubo, a manager at ANA Cargo, was surprised to see a warehouse at the Beijing Airport being exclusively used for Internet orders. The space, the size of a gym, was divided by a chain-link fence separating pre- and post-clearance goods.

ANA Cargo is a unit of ANA Holdings. Okubo got wind that the Chinese government, struggling against a tide of tax avoidance and counterfeit goods, may revise relevant taxes to boost cross-border business-to-consumer sales.

This summer, ANA Cargo bought a stake in ACD, a Tokyo-based company that has developed a system which creates customs documents by using information from e-tailers who ship internationally. The company aims to market the system to large electronics and department stores.

With China's economy slowing, Japan's air cargo industry has been sluggish. Simply put, carriers are moving fewer cars and electronic parts. So Okubo's view that "cross-border e-commerce is a promising market" is widely shared.

(Nikkei)

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