South Korea The Third Party Logistics Enterprise Development Strategy Research In China

The Third-Party Logistics (TPL) is not only a result of the development ofmodern logistics industry specialization, but also the outcome about the developmentof the further refinement in social division of labor. With the deepening of Chineseeconomic development and the social division of labor, TPL is increasingly becomingthe driving force of the growth of the logistics industry, TPL market in China isexpanding. In order to further extend and seize the Chinese logistics market share,Korea’s TPL enterprises need to continuously rainforce the competitiveness ofenterprises.For this reason, this study through field survey and interview method, discussesthe development status of the Chiniese logistics industry and TPL enterprises in Chinaincluding Korean TPL enterprises using QSPM method, analyzes developmentstrategy suitable for Korean TPL enterprise with different scale in China. It is clearthat the direction of the development of Korean TPL enterprises in the Chinese marketand to promote the healthy development of Korean TPL enterprises has a positivesignificance.The main conclusions of this study are as follows:First, field survey based on this study found that the TPL market in China has anenormous potentiality and Chinese local enterprises increasingly became the maindemand of TPL services, most of the companies would be transferred to specializedTPL enterprises to operate logistics departments, which means foreign TPLenterprises in the Chinese market has a broad development opportunities. At the sametime, the demand for value-added services and integrated services is increasing in theChina’s TPL market.Second, demand of the China logistics market differs in the regions andindustries, the TPL enterprises should subdivide the market based on regions orsectors of TPL market in China. Also about the market of different regions anddifferent sectors to further analyze of the market positioning, according to theconditions of the enterprises own resources, conduct the market segmentation andultimately select the appropriate target market. Third, a field survey that conducted based on market condition of the KoreanTPL enterprises in China shows that:From the point of view in types of company, Korean TPL enterprises in Chinamainly include three categories; the first category is the logistics enterprises take oninternal logistics sector of the production or distribution firm. The second category isthe Korean international TPL enterprises. The last category is the emerging TPLenterprises.Viewed in scope of business activities, business scope of the Korean TPLenterprises in China limited to the scope of the regional logistics, only6.76%surveyedthe Korean TPL enterprises in China operates nationwide business, the other93.24%of Korean TPL enterprises provides logistics services within the province andprovince in China.Viewed in regional distribution, Korean TPL enterprises in China are mainlylocated in the southern and eastern regions and its distribution is concentrated.Viewed in service content, logistics services of Korean TPL enterprises in Chinafocused on international logistics services as international multimodal transport andinternational express, the proportion of integrated and value-added logistics services isnot high.Viewed in problems in the development, Korean TPL enterprises in China are notyet equipped with independent transportation mode in China, land transportationservices are still dependent on Chinese domestic TPL enterprises and their corebusiness is not prominent. Also the marketing power of Korean TPL enterprises inChina is weak, Korean companies still lack in skilled logistics personnel and logisticsnetwork.Fourth, the internal factors score of Korean TPL enterprises in China is higherthan weighted average scores, this shows that they have advantages, especially withregard to the level of management, logistics infrastructure facilities, informationsystems. In addition, EFE Matrix score of Korean TPL enterprises in China is higherthan the weighted average score, this shows that Korean TPL enterprises in Chinarespond to the opportunities and threats of the external, it can take advantage offavorable opportunities and avoid the adverse threat through appropriate way.Fifth, IE Matrix result of Korean TPL enterprises in China shows that they are in the middle advantage position of the intra-industry, faced with moderate externalthreats, this shows that they have to maintain or expand market penetration andproduct development strategies.Sixth, according to EFE, IFE Matrix and TOWS analysis, data make a concreteQSPM analysis of development strategies of Korean TPL enterprises in China,concentrated differentiation strategy is confirmed the best strategy by the analysis ofQSPM. Therefore, Korean TPL enterprises in China should adopt concentrateddifferentiation strategy, to use its existing advantage and to seize on a chance, shouldprovide competitive logistics services.Seventh, Korean3PL enterprises should implement centralized differentiationstrategy, trying to find a new profit model, strengthen cooperation with Koreancompanies including distribution firms, build the core services, promote the marketingstrategy, reduce transaction costs with multilateral cooperation, strengthencommunication with the Chinese government to promote the development of theenterprises themselves. This study put forward series of development countermeasure.Eighth, Korean TPL enterprises in China of different scales should take differentdevelopment strategies. Korean TPL conglomerates should set strategic objectives tostrengthen its position in the Chinese market, build a network of regional TPL,specific strategic measures including: to provide integrated logistics services, establishthe status of the brand, put to use value pricing strategy, establish a reverse logisticsdevelopment strategy and the business strategy about the China’s inland. Korean TPLSMEs should set strategic objectives to maintain a growth rate rely on Koreancompanies, specific strategic measures including: select the appropriate BondedLogistics Park, concentrate specific service areas, use low price strategy about specificlogistics services.Ninth, Korean TPL enterprises should pay attention to provide the basic logisticsservices, subsequently begin to provide high-value services. Although the profit ofbasic services is relatively low, it can improve the credibility of its own as do a goodjob these services.