New York-listed online discount retailer Vipshop said over the weekend that it will cease using affiliate Pinjun Express for deliveries and switch to SF Express.

Vipshop CEO Eric Shen said the new tie-up will improve the e-commerce company's logistics, reduce costs, and let it offer “superior delivery services” to customers, according to a press release from the company.

Established in 2013, Pinjun Express has branches across China and has been cultivating overseas delivery business, public information shows. Vipshop’s statement did not say whether the company will be wound up.

Economies of scale are the spine of China’s saturated deliveries industry and Pinjun’s limited scope saw Vipshop’s cost per parcel rise higher than the industry average. There were also fears that Pinjun would struggle to handle the retailer’s increasing orders. Vipshop had been outsourcing delivery business since earlier this year.

Read the full story on Caixin Global later today.

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