In the 2010s, as ecommerce took off in Southeast Asia, logistics quickly emerged as a bottleneck.
How do you move millions of parcels across congested cities and remote rural terrain?
Traditional postal networks had the reach, but not the speed, service levels, or reliability ecommerce demands. This created a funding boom in ecommerce logistics. Regional and local players – like Ninja Van, Flash Express, and Indonesia’s Sicepat – attracted significant capital. SF Express even acquired Kerry Express in Thailand.
China offered a playbook. While SF Express remained premium, a group of ecommerce-native express firms – ZTO, YTO, STO, Yunda, and J&T – handled the bulk of China’s daily 150 billion parcels.
Many of these are now public; ZTO Express, the largest, is valued at HK$112 billion (US$14.3 billion).
But while Southeast Asia’s logistics market has become very sizable (71% of US’s parcel volume), it has evolved very differently compared to China’s.
As outlined in our Ecommerce in Southeast Asia 3.0 report, the region’s ecommerce parcel delivery has become highly concentrated.
By 2024, just three players – J&T Express, Shopee’s SPX Express, and Lazada Logistics – handled 60% of all parcel volume in the region.
Legacy players like JNE and Sicepat have slipped out of the top five. Combined, all non-top-5 players accounted for just 29% of volumes.
Volume isn’t the only concern. Margins are under pressure. J&T Express’s financials show that average revenue per parcel has dropped by more than 1/3 over the past four years.
This matches what we heard on the ground while researching the report: platforms are demanding higher service standards while driving prices down.
Larger players, especially those with scale like J&T, can absorb this because of their volume and density. Smaller players can’t.
Why has Southeast Asia’s ecommerce logistics evolved so differently from China’s? The key lies in parcel allocation. In China, sellers pick their logistics partners. In Southeast Asia, platforms assign parcel volumes.
This allocation model creates a self-reinforcing cycle: lower volume means higher costs and poorer service, which leads to even lower volume. Platform bidding systems exacerbate the issue, favoring larger players with better cost efficiency.
Indonesia’s 2025 rule to cap 3PL discounts will do little to change this. The issue isn’t just pricing power – it’s platform concentration. Top 3 platforms in Southeast Asia controlled more than 84% of the GMV in the region:
Some logistics players are trying to break the cycle by overhauling their network design and cost base. It’s a necessary step if they want to stay in the game.
The post Outpaced and outbid: the squeeze on Southeast Asia’s ecommerce 3PLs first appeared on The Low Down - Momentum Works.
