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CJ Logistics / Korea-U.S.-Japan 'Reverse Direct Trade Alliance' to Strengthen Cross-Border Logistics

2024/06

Korea, U.S., Japan 'Build a Reverse Direct Shipments Alliance' to Strengthen Cross-Border Logistics

One-stop logistics for reverse direct shipments from Korea

CJ Logistics is launching a reverse dropshipping logistics business by establishing a logistics cooperation network connecting Korea, the United States, and Japan. CJ Logistics' reverse direct logistics network in major countries is expected to serve as a lubricant for domestic e-commerce companies to facilitate direct sales overseas, amid growing calls for 'reverse direct sales promotion' instead of 'direct sales regulation'.

CJ Logistics announced that it is partnering with leading local logistics companies in the U.S. and Japan to build a reverse direct logistics network that will provide one-stop access to export customs clearance, forwarding, and local delivery.

In the U.S., several local logistics companies, including FedEx, will be partners. CJ Logistics will transport the goods to LA International Airport and New York JFK International Airport through air forwarding, and local logistics companies with a dense last-mile delivery network will be in charge of delivery. In Japan, CJ Logistics' first and second-tier local courier companies, which have signed delivery contracts with CJ Logistics, deliver reverse direct goods to end customers at Narita Airport in Tokyo, Japan.

Previously, CJ Logistics signed a customs clearance and delivery service agreement with Ninja Van in April to strengthen its reverse logistics business in Southeast Asia. When CJ Logistics sends goods to Southeast Asian countries, Ninja Van will perform customs clearance and delivery services in six countries, including Singapore, Malaysia, Indonesia, Vietnam, the Philippines, and Thailand.

CJ Logistics' dense logistics network in Korea, the U.S., Japan, and Southeast Asia will greatly reduce the logistics burden for reverse direct customers. Instead of having to find a logistics company to handle local customs clearance and delivery overseas, CJ Logistics can solve the entire process of reaching the end consumer at once.

In addition, if economies of scale are realized through collaboration among global logistics companies, logistics costs are expected to be significantly lower than reverse direct delivery using existing international express. With these advantages, CJ Logistics' current reverse logistics business for K-pop goods and albums for fandom business customers is expected to accelerate.

As domestic e-commerce companies actively target overseas markets to expand their sales, the reverse dropshipping market is expected to grow. As the Hallyu craze and fandom business expand, Korean products ranging from K-pop albums and merchandise to beauty and fashion are gaining popularity and demand. As a result, the reverse delivery logistics market is also expected to grow, and CJ Logistics' logistics network with the largest local delivery companies overseas is expected to serve as a lubricant for e-commerce companies' reverse delivery business. According to Statistics Korea, the total amount of online overseas direct sales, meaning reverse direct sales, will reach 1.56 trillion won in 2023. Of this, the U.S. accounted for 228.1 billion won, Japan 267 billion won, and ASEAN 90.8 billion won.

“By establishing a cooperation system with local logistics companies centered on countries with high demand for overseas direct orders, we have laid the foundation for the reverse direct logistics business, which is a new growth engine,” said Jang Young-ho, head of IFS at CJ Logistics. ”We will continue to lead the cross-border logistics market, including reverse direct orders, by building a tighter global network and synergizing with our forwarding business.”