Chapter 1067: Upwind Logistics’ Business Expansion!
Lu Mingliang paused for a moment and continued, “At the moment, we already have 4,000 Upwind Courier stations. You have to know that some local express delivery companies only have about 2,000 plus points in the country. We have already surpa.s.sed them in terms of numbers.”
“Upwind Logistics will continue to incur losses like this and can only rely on the transfusions of other industries. This is not a long-term plan. We have to further reduce losses and increase profits in order to develop better.”
“Therefore, I think we should start preparing for the regular delivery business across cities and s.n.a.t.c.h the profits from other delivery companies!”
Upwind Logistics had been doing the dirty work that other express delivery companies were most unwilling to do.
“The last mile” had always been a huge problem in the delivery industry. That was because it was very convenient to transport the goods from the transfer point to the express delivery site. A car of goods could be directly pulled over. However, it would cost a lot of manpower to send the deliveries to their doorstep one by one.
The other express delivery companies were the most efficient and profitable ones while Upwind Logistics was the most troublesome and had the least profits.
Upwind Logistics had solved the problem of the last mile for other express delivery companies. On average, they would only charge two to four cents for each package. Even though they were mainly collecting small items, they were still incurring losses. The cost and returns were not proportional.
Some platforms offered a plan to make delivery cabinets for customers to collect by themselves.
However, the problem was that this express delivery cabinet had received money from the express delivery company and saved a lot of money for the express delivery company. However, it had transferred the last mile errand to consumers.
Consumers walked and moved things. The delivery cabinet also occupied areas that were provided by the community. In the end, it saved the delivery company some trouble and made the delivery cabinet earn money. On the contrary, it did not benefit them at all. The service that they should have enjoyed was also discounted.
Some customers liked to go to the express delivery cabinet to collect their own items because of the working hours. However, this could only be one of the choices. They could not force people who did not want to go out to collect their own items. This was an action that was too sneaky. In fact, it violated the legal rights of consumers.
Upwind Courier stations could allow delivery men to deliver their goods to their doorstep. They could also allow customers to come to their doorstep to collect their own items. They could also obtain some points by coming to their doorstep. This was the solution to protect the rights of consumers.
Of course, Lu Mingliang was very dissatisfied with the current situation where others could only eat meat and Upwind Logistics could only drink soup.
He would not force other companies to drink soup, but why couldn’t he eat meat?
Wasn’t it just collecting the package, sorting it in the distribution center, transporting it to the target city, sorting it again, and then distributing the package?
Why couldn’t Upwind Logistics make a huge profit?
He did not do it in the past because there were too few shops and the coverage was not enough. He had to make arrangements first.
They had already opened more than 4,000 stores, yet a burly man was only eating soup and not meat. In the end, he was starving. Was that appropriate?
Obviously, it was very inappropriate.
Thus, he had come this time to report to Boss Pei about Upwind Logistics’ current situation. On the other hand, he wanted to test Boss Pei’s att.i.tude towards this matter. He hoped to expand Upwind Logistics’ business as soon as possible.
He would not be able to turn his losses into profits very quickly. At the very least, they would be able to start up the cross-city express delivery business and reduce their losses.
Otherwise, if he continued to incur losses like this, it would make him look like the person-in-charge had been doing nothing. He would not even be able to lift his head when the person-in-charge gathered.
Pei Qian’s expression turned serious.
This was bad!
Obviously, Lu Mingliang had been working diligently at Upwind Logistics for more than a year. He would definitely not be satisfied with opening shops like this.
Only Lu Mingliang could tolerate it for so long. If it had been someone else in charge, they would probably have come to protest and ask to expand their business half a year in advance.
After some thought, Pei Qian decided that it would not be appropriate to reject him directly.
Lu Mingliang was a rather down-to-earth person. He did things steadily and was very serious about completing his tasks. He was very good at carrying out his tasks. The fact that he had taken the initiative to suggest this was enough to show that he had thought about it carefully and repeatedly. He had only found Lu Mingliang because he could not hold it in anymore.
There were already more than 4,000 shops. The most difficult problem of ‘the last mile’ had already been solved. It was just a matter of convenience to do cross-city delivery. Why not?
Pei Qian could not think of any other reason to reject Lu Mingliang’s suggestion apart from the fact that he was deliberately incurring losses.
However…
Should he agree to Lu Mingliang’s proposal just like that?
Of course not!
If the logistics were done well, Pei Qian would be able to make a lot of money. Upwind Logistics had been incurring losses, but if they turned their losses into profits, Pei Qian would vomit blood on the spot.
Thus, he had to make some adjustments to Upwind Logistics’ business and appease Lu Mingliang. He also had to ensure that Upwind Logistics would continue to incur losses.
Pei Qian quickly thought of a good idea.
“Yes, you’re right. Upwind Logistics should make some adjustments.”
“However, there is one thing to note. Upwind Logistics might have 4,000 stores, but they are all distributed in four areas. Jingzhou, Beijing, Shanghai, and Guangzhou are the core cities. They are spread to the surrounding areas. However, in the vast areas other than these four areas, such as ordinary provincial capital and second-tier cities, there are no stores, much less the small county cities.”
“If we can’t send it to this city or that city even though we want to develop to be a cross-city delivery business, how can we compete with other delivery companies?”
“The other express delivery companies might only have 2,000 shops, but they are all over the country. They also cover some small county cities. This is a fundamental difference.”
“Their stores cover an especially large area. Even though they have many deliveries, slow delivery, and often lose one, they can ensure coverage in most cities in the country.”
Lu Mingliang could no longer remain calm. “Boss Pei, do you mean to say that we can only do regular delivery services once our shops fill the entire country? How many years and months would that take…”
Pei Qian smiled. “What I mean is that we can do it, but we have to compete with other express delivery companies.”
“What’s the difference between Upwind Logistics and other delivery companies if we just rent a warehouse and buy some equipment as a sorting center and rent some large trucks to transport goods?”
“My idea is to make use of Upwind Logistics’ current advantage and make it faster than any express delivery!”
“If we want to be faster than other express delivery services, we can’t use the traditional land transportation method. We’ll do it via air transport!”
“Talk to the airline about cooperation, rent a plane to transport goods. With Jingzhou, Beijing, Shanghai, and Guangzhou as the center, there would be at least one flight to transport goods every day. That way, there would be twelve flights every day to transport the goods to the corresponding city.”
“After that, these goods would be sorted out and sent to the surrounding cities through traditional land transportation methods. That would be faster than other express delivery companies! Of course, it would only be limited to areas within our business coverage.”
“We will not provide any mailing or retrieval services outside of these four areas for the time being.”
Lu Mingliang was stunned.
It turned out that Boss Pei did not disapprove of his views, but he was thinking about even further!
Delivery companies in this world were mainly doing land transportation. It would take three days to send deliveries from Guangzhou to Beijing. If it was delayed, it would take four days or even longer.
What Boss Pei was thinking was that with Jingzhou, Beijing, Shanghai, and Guangzhou, the four cities that were covered by Upwind Courier stations as the center, the surrounding cities would become a land transportation zone.
Between these four cities, they could use pure air transport to shorten the express delivery that would take three days to deliver.
In the region, such as other cities from Jingzhou to Handong Province, they could be transported by land transport. They might not have an obvious advantage in speed compared to other express delivery companies but one could not forget that Upwind Courier stations were owned by Tengda.
For the same goods, Upwind Courier stations would definitely prioritize sending their own parcels before sending other parcels.
That way, he could use Upwind Logistics to deliver packages in the areas that Upwind Courier stations covered. He could definitely obtain a better experience than ordinary express delivery companies.
Those 4,000 Upwind Courier stations were not for nothing. They had to be effective at this time.
What Pei Qian really cared about was actually very simple. There was a high threshold for air transport, and he could spend more money!
Was it the same concept as traveling a long distance with a few large vans for the fuel cost of a flight?
What’s more, the price of air transport would definitely be much higher than ordinary express delivery. There would not be many people using it in the beginning. What’s more, there were strict restrictions on the goods used for air transport. Many things could not be boarded.
At that time, no matter whether a plane was filled or not, it would take off as scheduled. Wouldn’t it be pure spending money to fly an empty plane?
What’s more, working with airline companies, renting planes, and even building an airport himself in the future, buying planes directly, and so on were all huge expenses. There was a lot of potential to burn money and upgrade in the future.
Of course, if the air transport could be done, it would definitely be easy for land transportation.
As Upwind Logistics developed further, Upwind Courier stations would definitely spread to more cities. Long-distance transportation would definitely not only go through air, but also slowly use land transport, including rail transport and long-distance transport.
However, those were things that he would have to worry about in the future.
In the short term, Upwind Logistics would only do the current “cross-regional transportation and land transportation” method. They would definitely incur losses.
As for which goods could be delivered, which places could not be delivered, and which places could not be sent, these would be handled by the lowest-level delivery men.
The delivery man only had to check if the goods met the standards and if there were Upwind Courier stations before the customers sent the mail.
If he did, he would send it to Upwind Logistics. If not, he would send it to other express delivery companies.
Once the business expanded, Upwind Logistics section on Tengda Life App would also be updated. They would support players to find out the location of their packages in real time.
However, these were things that Lu Mingliang had to worry about in the future.
Pei Qian said, “That’s the general situation. Of course, we have to cooperate with the airline, rent planes, and establish a sorting center in the outskirts of the city. We also have to update the logistics system of the entire express delivery so that the transit between the various steps would be smoother…”
“A lot of preparatory work is required.
“How about this? I’ll give you three months to prepare and negotiate the business. Three months later, I’ll give you a special fund to gradually implement the new business.”
Actually, the main reason was because of the funds.
Tengda had just recovered from the money burning war. Pei Qian had thought of many ways to spend money again now that the money was coming back so quickly.
On the other hand, Upwind Logistics’ business upgrade this time was not part of the plan. Pei Qian had not arranged for special funds previously. It was not a small sum to rent a plane and build a sorting center in various cities. It would be difficult to squeeze in.
What’s more, there were only two months to settlement. It was obvious that it wouldn’t be able to make it in time for this settlement.
When the next cycle began, the remuneration for the movie would probably arrive soon. The various departments would also be able to save up a huge sum of money. That would be enough to burn it into Upwind Logistics.
Lu Mingliang was very happy. He had gained a lot from meeting Boss Pei.
He immediately nodded. “Alright, Boss Pei. I’ll make the arrangements now. I’ll definitely do it beautifully!”