SF Express Speeds Into Big-Data Joint Venture

China’s largest privately owned courier SF Express has set up a joint venture with eight smaller logistics operators to share data, as the firm also reported another strong quarterly profit.

The 100-million-yuan ($15.8 million) joint venture will be co-owned by SF Express and other logistics companies such as Shenzhen Easttop Supply Chain Management Co. Ltd. and Shenzhen Feima International Supply Chain.

SF Express will hold 11% of the joint venture with an investment of 11 million yuan, the delivery firm said in a statement Friday (link in Chinese).

SF Express’s investment comes as the country’s couriers rush to digitize their services to find advantages over each other. Many in the crowded field are using their own mobile apps or partnering with third-party platforms, such as internet giant Tencent Holdings Ltd.’s messaging app WeChat.

Such companies generate huge amounts of data from consumers, which they hope can be used to analyze behaviors to improve existing service and generate revenue through introduction of new offerings.

SF’s joint venture will build an “open big-data platform” where different companies will use their experience to improve logistics efficiency both domestically and internationally, according to the statement.

Legal professionals from a third-party independent law firm will be invited to monitor the new company’s businesses to ensure data security, the statement added.

Separately, SF Express reported on Friday (link in Chinese) its first quarter profit rose 28.6% to 995 million yuan, while revenue rose 33% to 20.6 billion yuan.

Shenzhen-listed SF Express, with a market value over 200 billion yuan, operates a fleet of more than 40 cargo aircraft and is now the country’s second-largest courier, after state-owned China Post Group Corp.

The company competes with about a dozen other private players, including Shanghai YTO Express Logistics Co. Ltd., and e-commerce giant JD.com’s logistics arm, JD Logistics.

China’s logistics industry has boomed in recent years, fueled by the nation’s thriving e-commerce sector. Total revenues in the sector rose 24.5% to 495 billion yuan last year — more than double the already strong growth in 2014, according to China’s State Post Bureau.

Contact reporter Mo Yelin (yelinmo@caixin.com)