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Hong Kong Hub Set to Boost Post of Russia's E-commerce Delivery Time

National mail carrier looks to reinvent itself in face of drastically-changed expectations and much-increased competition.

Photo: Post of Russia: Looking to update delivery channels and cut transit time for mainland-sourced items. (Shutterstock.com/YANGCHAO)
Post of Russia: Looking to update delivery channels and cut transit time for mainland-sourced items.
Photo: Post of Russia: Looking to update delivery channels and cut transit time for mainland-sourced items. (Shutterstock.com/YANGCHAO)
Post of Russia: Looking to update delivery channels and cut transit time for mainland-sourced items.

Faced with meeting the ever-evolving requirements of the e-commerce generation, while also fending off challenges from various wannabe logistics upstarts looking to make inroads into its core business, the Post of Russia has been faced with the option of either withering away or transforming. Unsurprisingly, it seems to have plumped for the latter and is currently looking to reinvent itself in terms of both its scope and speed of delivery.

In line with this, last month the state-owned mail carrier launched a new route with a view to cutting the delivery time between China and Russia's Far East region, a service intended to placate the many online shoppers in Siberia and the Urals who have been notably unimpressed by the tardy arrival of many of their orders. In order to optimise such deliveries, the new service leverages its upgraded consolidation hub in Vladivostok, which is, in turn, connected to a number of other inland consolidation hubs along the route of the Trans-Siberian Railway, including Novosibirsk, Yekaterinburg and Moscow.

Utilising rail and maritime delivery facilities, after being consolidated in Hong Kong, parcels are now shipped to Vladivostok before being entrained. Among the items cleared to be carried on the route are parcels weighing less than 2kg and those with a declared maximum value of US$10.

In terms of the source of e-commerce deliveries, some 91% of all overseas orders placed by Russia's online consumers are serviced from China, with the total 2017 value of mainland-sourced goods estimated at about $4 billion. The clear market leader is AliExpress, with about 40% of all items likely to be delivered via this new Far East route expected to come courtesy of the Hangzhou-headquartered online retailer.

Previously, AliExpress handled the majority of its Russia-bound deliveries via its own Moscow-located consolidation hub, even when such deliveries were ultimately destined for the country's Far East region. As a result, many geographically-disadvantaged Russian e-shoppers had to wait up to 40 days for their purchases to be delivered. Under the new arrangement, deliveries to even the most remote destinations are said to be achievable within 14 days, while, in the case of the majority of the country's major cities, the door-to-door China-Russia delivery time will be seven days or less – making the Post of Russia the fastest and cheapest option.

For companies based in either Hong Kong or Southern China, their proximity to the SAR's Post of Russia consolidation point gives them a clear advantage in terms of cost and delivery times compared with their competitors based in the more northerly parts of the mainland. Significantly, the Post of Russia is now the only former Soviet national mail carrier to maintain a Hong Kong consolidation hub, a privilege it owes to Russia making a land grab for all the existing international treaty entitlements in place when the Soviet Union collapsed in 1991.

Leonid Orlov, Moscow Consultant

Content provided by Picture: HKTDC Research
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