Leading Chinese express operator SF Express will set up a joint venture with Estonian postal group Omniva to target e-commerce deliveries to Europe and beyond.
The Estonia-registered joint venture, to be called ’Post11’, will initially focus on deliveries of goods between China and Europe, using Estonia as a gateway, before moving into other international markets.
“The goal is to expand the business model all over the world, to forward shipments between different countries and to expand in the value-chain of e-commerce with new solutions,” explained Aavo Kärmas, Chairman of the Management Board of Omniva.
“Most of the new company's business is forwarding the goods ordered from Chinese e-stores to different countries. While, presently, Russia is the largest target market, volumes into other European countries are set to increase. In the future, the company plans to expand its business even further in the geographical sense, and offer solutions to the e-traders of different countries,” he added.
According to Kärmas, the global e-commerce business offers wide opportunities to the new joint company. “In 2014, the volume of e-commerce oriented to the global end consumer was nearly USD 1.5 billion. Growth is mainly generated by the increasing number of purchases made, using the Internet and mobile phones. Based on forecasts, China should pass the US this year and become the largest e-commerce market in the world,” he said.
Omniva has been cooperating with S.F. Express for over a year and the establishment of the joint enterprise is a logical continuation of the cooperation so far. With the establishment of the joint enterprise, Omniva wishes to strengthen its position in the international e-commerce business, and S.F. Express wishes to gain access on the European market by expanding their distribution centres and airlines.
For Estonian consumers, the establishment of the joint enterprise and a direct connection with China is primarily providing faster shipments of goods from Chinese e-stores to the client. It will also create approximately 50 new jobs in Estonia.
S.F. Express is China's largest privately owned company that provides courier services. S.F. Express provides courier services in China, USA, South Korea, Singapore, Malaysia, Japan, Vietnam, Thailand and Australia. S.F. Express group also includes the airline S.F. Airlines, which provides transport services with 39 planes.
Omniva group consists of the state-owned AS Eesti Post as the parent company, and AS Eesti Maksekeskus as a subsidiary, along with subsidiaries UAB Omniva LT in Lithuania and SIA Omniva in Latvia.
