1. Kerry Logistics' Global Expansion Strategy

Since SF Express acquired Kerry Logistics, attention has mostly focused on SF’s interest in Southeast Asia and its ambition to expand in that region. However, Kerry Logistics, a logistics giant from Southeast Asia, operates in 59 countries and regions worldwide, making it a key player in goods transportation between Asia, Europe, and the U.S. According to *Transport Topics*, Kerry ranked 11th in global air freight forwarding and 9th in ocean freight forwarding in 2024. In A&A’s ranking of the top 25 global freight forwarders, Kerry Logistics secured the 10th spot. These rankings reflect Kerry's significant presence in the global market.

Founded in 1991, Kerry Logistics is one of the earliest international freight forwarders in China. Beginning with warehouse services, Kerry shifted its focus to global operations in 2000. Mergers and acquisitions were pivotal in expanding its network. Kerry's growth aligned with shifts in regional trade, while its logistics operations saw steady development across Asia, especially in building logistics facilities.

Currently, Kerry's global network spans seven continents, covering major regions such as Greater China, North Asia, Southeast Asia, and South Asia, along with markets in the U.S., Europe, and emerging markets like the Middle East. Its core services include integrated logistics, international freight forwarding, express delivery, supply chain solutions, and cross-border e-commerce logistics. Kerry serves industries like electronics, pharmaceuticals, international fashion, and FMCG (fast-moving consumer goods), working with leading global brands.

In June 2022, Kerry signed an international freight forwarding agreement with SF Tyson, an SF Express subsidiary. By transferring its air freight business to SF Tyson, Kerry gained direct access to SF’s air network, significantly reducing third-party costs and boosting competitiveness.

Moreover, Kerry continues its expansion through acquisitions. In February 2022, it proposed acquiring a California-based international freight forwarder for up to $240 million. In June 2022, it acquired a 39% stake in Gaffco International Freight, which operates in Hong Kong and mainland China, to strengthen its California and China presence. In March 2023, Kerry announced plans to issue convertible bonds worth up to HKD 780 million to develop Southeast Asia’s international express business.

In the first half of 2024, Kerry Logistics saw revenue grow by 10%, from HKD 23.197 billion in 2023 to HKD 25.432 billion. Integrated logistics (IL) achieved HKD 693 million in profits, with strong performance in Singapore, Vietnam, the Philippines, and India, while Thailand’s Kerry Siam port remained stable.

Kerry’s international freight forwarding (IFF) division also performed well, with profit growing 18%, from HKD 626 million to HKD 740 million, driven by growth in key markets such as the U.S., mainland China, and Hong Kong. Notably, despite the off-season, air freight also experienced stable growth due to cross-border e-commerce.

2. Kerry eCommerce’s Southeast Asia Strategy

Kerry Logistics plays a key role in the booming e-commerce market in Southeast Asia. Countries like Indonesia, Vietnam, Malaysia, and Thailand are rapidly becoming global e-commerce hotspots, with a young population, increasing internet penetration, and widespread adoption of mobile payments driving growth.

According to the *2023 Southeast Asia Digital Economy Report* by Google, Temasek, and Bain & Company, Southeast Asia's e-commerce market grew by 18.6% in 2023, ranking first globally. Research from eMarketer shows that Southeast Asia’s e-commerce sales grew by 18.6% in 2023, far exceeding the global average of 8.9%. These figures highlight the region’s growing logistics demand, providing Chinese logistics companies with vast opportunities.

To meet the diverse needs of cross-border e-commerce companies and embrace logistics trends, Kerry Logistics established *Kerry eCommerce* to provide end-to-end logistics solutions, including B2B and B2C services, import/export customs clearance, overseas warehousing, and last-mile delivery.

Between 2010 and 2015, Kerry eCommerce gradually entered the Southeast Asian market, building early logistics networks using Kerry Logistics' infrastructure and partnerships. During this time, it partnered with local e-commerce platforms like Lazada and Shopee.

From 2016 to 2019, e-commerce in Southeast Asia rapidly expanded, and Kerry eCommerce took advantage by investing in modern warehouse facilities and optimizing cross-border logistics. Collaborations with giants like Alibaba and SHEIN further enhanced its influence in the region.

Post-2020, Kerry eCommerce began transitioning to digital and smart logistics solutions to handle the increasingly complex e-commerce landscape. This included developing intelligent logistics management systems and automated warehousing solutions to streamline operations and reduce costs.

Kerry eCommerce now operates state-of-the-art warehouses in Thailand, Malaysia, Vietnam, and the Philippines, leveraging automated sorting systems and AGV robots to improve efficiency. It has partnered with over 170 last-mile delivery companies and built expertise in customs clearance and certification, providing seamless logistics services for outbound brands.

Kerry eCommerce uses real-time monitoring of logistics processes via data analysis platforms, applying AI learning to predict demand and optimize routes. The self-developed KEC ENGINE digital system provides customers with seamless order tracking and custom logistics services, ensuring smooth operations from entry into the market to final product delivery.

3. Kerry eCommerce's Future Development

Southeast Asia serves as both a hotbed for e-commerce and a springboard for Chinese logistics companies to globalize. However, unlike China’s unified market, Southeast Asia’s logistics sector faces several challenges despite its immense potential.

The first challenge is the uneven infrastructure. Logistics infrastructure varies significantly across Southeast Asian countries, with geographic complexities making delivery costly, especially in places like Indonesia and the Philippines. Furthermore, political, economic, and cultural differences between countries increase the complexity of logistics networks, requiring Kerry eCommerce to tailor strategies for each market.

Another challenge is fierce competition. Southeast Asia’s logistics market has attracted many global and regional players, including giants like DHL, UPS, and FedEx, alongside Chinese competitors like J&T Express, Best Logistics, and Cainiao. This intensifies the competition Kerry faces in the region.

To tackle growing e-commerce demand and intense competition, Kerry eCommerce plans to further invest in smart warehousing and automated delivery technology, while expanding its global logistics network to support more brands in achieving global growth.

Official WeChat Account: Cross-border E-commerce Logistics Baixiaosheng