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Newcomer to provide solution
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Yang Yunfei
CHINA'S emerging logistics sector is expected to benefit the country's imminent WTO entry. But industry analysts say that the low circulation rate, inefficient transport network and ill-prepared embrace of information technology have combined to create obstacles to the fast-growing industry.
It is said that a traditional Chinese sorting and distribution centre covering an area of 7,500 square metres can only handle commodities worth about 200 million yuan (US$24m) annually, at least five times less than those in some Western countries.
Shenzhen may find it especially urgent to address these constraints and bottlenecks as China's first special economic zone has listed logistics as one of the city's mainstay industries to power its economy in the coming years and plans to build itself into a regional logistics centre.
Little-known Shenzhen Nil Integrated Logistics Development Co Ltd seems to be spearheading the country's efforts to remove these logistics hindrances.
With advanced logistics information systems and management expertise provided by Fujutsu Co Ltd of Japan, the company launched a sorting and distribution centre in March to combine a modern commodity transport, storage, sorting and distribution facility.
Liu Xingfu, general manager of Nil Integrated Logistics Development, said the centre is the only one in the country built “in line with international standards".
This computerized centre features a system called Digital Picking System, which can greatly reduce workforce but greatly improve efficiency.
“The quality of modern logistics services is measured by transport capacity per hour and goods' circulation rate," said Liu, who noted that his centre, occupying an area of 75,000 square metres, could operate five times faster than a traditional one.
“Faster speed means that we can make better use of our warehouse than our competitors," said Liu. “The sorting and distributing capacity of our centre is expected to reach 800 million yuan worth of goods every year, much higher than our counterparts."
Liu said that the centre is the brainchild of a Sino-Japanese agreement signed in 1998 when President Jiang Zemin toured Japan.
Liu foresaw a very bright future for his centre as 80 per cent of the 53.8 billion yuan worth of commodities consumed in Shenzhen are not locally produced.
“At least 40 per cent of the goods need to be sorted and distributed before Shenzhen retailers get them and then sell them to local consumers."
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