How J&T Express disrupted ecommerce logistics in Mexico

With the growth of SHEIN, Temu and ecommerce in general in Latin America, many Chinese ecommerce logistics companies expanded into the market to provide the delivery infrastructure. Mexico and Brazil are the two key markets where these logistics players are bringing significant change to the local ecosystem. 

Last week, an interview with J&T Express’s Deputy CEO for Mexico Ethen Huang was published by a Chinese media outlet. We have extracted some interesting bits of information from the article here – do note that we have not verified the information in the articles ourselves, and the opinions expressed there are not ours: 

1. Mexico is a hotbed for ecommerce growth: MercadoLibre’s Mexico GMV grew 27% YoY in the first 3 quarters of 2024; Amazon has 27,000 sellers in Mexico;SHEIN and TEMU each could achieve daily GMV of US$7-9 million; while Shopee and AliExpress cross-border business are growing fast too;
2. Sensing the opportunity, J&T sent a team of 20+ in 2021 to study the Mexico market. The team was divided into 10 groups and traveled to all 31 states and the capital;
3. J&T launched its first operations in Mexico City in November 2021, and expanded to cover all states by April 2022. The orders did not come immediately, making the team a bit nervous. In order to sustain the costs, they started promoting to SMEs – but the first customer that gave large volume was local brand Italika;
4. The top 3 priorities of J&T in Mexico have been: 1) setting up service points; 2) managing relationships with ecommerce platforms; and 3) solving the issues of high cost and low speed.
5. Another key operational challenge is the regulatory requirement of signing for receipt. There was no parcel locker infrastructure, and no process of contacting customers to confirm delivery beforehand;
6. Currently, J&T Express handles all SHEIN’s local parcels, and 60% of SHEIN’s cross-border parcels. When Temu entered in May 2023, it gave most of its parcels to J&T to handle. (At that time, Pinduoduo, Temu’s Chinese domestic business, accounted for 80% of J&T’s parcel volume in China);
7. Both SHEIN and Temu grew very fast. As a result, J&T’s capacity was overwhelmed at the end of 2023, causing delays especially for other ecommerce platforms working with J&T. The problem has since been resolved through expansion of capacity;
8. The average daily volume of J&T in Mexico was below 200,000. That number has doubled this year, with peak daily volume reaching 700,000 parcels;
9. J&T has 1300 service points across Mexico now. To ensure the safe passage of deliveries, J&T hired a security team to build a map detailing the safe routes and those to avoid. That map has been issued to every delivery person as a matter of safety;
10. J&T’s employee count in Mexico is around 7,000. At the manager level, 90% were local;
11. Other delivery companies of Chinese background – Rabee and iMile for example – have been competing fiercely with J&T. Before these players entered, most logistics companies did not provide services during weekends. J&T was the first to provide 365 days non-stop service;
12. Another improvement J&T has brought into Mexico’s ecommerce delivery system is faster communications. “Most companies communicate by email, and it often takes weeks to resolve a problem. With J&T, when customers give a request in the morning, and quite often a solution is worked out in the afternoon and implemented the next morning”;
13. “Young Mexicans are hardworking. As long as you make it clear in the employment contracts on working days and hours, as well as extra compensation for weekends, they will execute well.”