Frost & Sullivan: Express delivery price hikes are a key inflection point in correcting the 'price-for-volume' trade-off, and the industry is returning to value competition

The core effect of this round of policy-guided express delivery price hikes is reflected in the effective containment of the long-standing "price-for-volume" vicious competition model in the industry, promoting the industry back onto a "value-driven" healthy development track.

Effect and Reasons

Firstly, from operational data, the effect is significant. In September 2025, several express delivery listed companies achieved synchronous growth in business volume and per-order revenue, presenting a positive situation of "both volume and price rising," which directly improved the profitability of enterprises and alleviated the previous operational pressure of "increment without revenue growth."

Secondly, the main reason for the price hike is the strong intervention at the policy level. The State Post Bureau and relevant departments have clearly opposed industry "involution," severely cracking down on dumping below cost prices through a series of regulations. This provides express delivery companies with the confidence and basis for price hikes, aiming to ensure stable operations at end points and the legitimate rights and interests of couriers, ultimately improving overall service quality.

Difficulties During the Process

However, the price hike process has not been smooth sailing, mainly facing the following difficulties:

• Customer sensitivity and churn risk: Price hikes directly affect e-commerce customers who are highly sensitive to prices, especially merchants operating low-cost single-item goods. They may switch to cooperative courier companies or even move their warehouses to areas where courier prices have not yet risen in order to avoid cost increases.

   

• Execution difficulties under the franchise model: In express delivery companies mainly based on the franchise model, the interests of headquarters and end points are not entirely aligned. Facing competition from major customers, some franchisees may choose to compromise to maintain business volume, resulting in discounts when the price hike policy is implemented at the end points.

   

• Adaptation and competition within the industrial chain: Price hikes are a game process involving the entire industrial chain. Upstream e-commerce merchants have long relied on low-cost express delivery to control operating costs and need time to adapt and adjust their operational logic. At the same time, consumers may also face pressure from rising commodity prices due to cost shifting.

The price hike trend in the express delivery industry this time has a certain degree of sustainability, but the process will be gradual and full of competition. In the future, the price hike scope is expected to spread from point to other regions across the country.

Sustainability and Scope Expansion

The sustainability of price hikes mainly depends on several points: First, the country's firm stance and continuous policy pressure against "involution" provide institutional guarantees for prices to return to a reasonable range. Second, express delivery companies themselves have also realized the harm of low-price competition and have an internal drive to get out of the "profit dilemma" and pursue high-quality development. Third, market demand continues to grow, providing space for price adjustments. However, considering the complexity of the market, there is still a possibility of short-term price fluctuations or even small-scale declines, but it is almost impossible to return to an extreme era of low prices.

Measures to Avoid a Resurgence of Low-Price Competition

To avoid a resurgence of low-price competition, multiple parties need to work together to build a sustainable and balanced industrial ecosystem:

Strengthen policy supervision and enforcement: Regulatory authorities need to establish a dynamic cost monitoring system and cross-regional collaborative law enforcement mechanisms to ensure that the ban on "shipping below cost" is effectively implemented and prevent the policy from "going astray."

• Promote enterprises to shift from "price wars" to "value wars": Express delivery companies should shift the core of competition from simple price comparisons to service quality, operational efficiency, and technological innovation. By providing differentiated and personalized services (such as door-to-door delivery, night delivery, etc.) to enhance brand premium capabilities and customer stickiness.

   

• Accelerate technology empowerment and industrial collaboration: Promote the application of intelligent technologies such as automated sorting, big data route optimization, and unmanned delivery to continuously reduce costs and increase efficiency. At the same time, strengthen deep integration with the e-commerce industry, develop collaboratively through models such as warehousing and distribution integration, optimize the supply chain, and achieve win-win results.

   

• Ensure end-point rights and stimulate vitality: A reasonable pricing mechanism should ensure that profits can be effectively transmitted to end points and couriers, guaranteeing their reasonable income and labor rights, stimulating the service vitality of the "last mile," which is the fundamental guarantee for improving service quality.