China: Difficulties in refrigerated distribution industry

More and more people have noticed the potential for the refrigerated distribution industry in recent years and several leading tycoons have begun to make their move in the first half of 2018. The prospects for development look great, but conditions are not ideal, and there are still many difficulties that must be solved.

The market value of China's refrigerated distribution industry reached 300 billion yuan [43 billion USD] in 2018, and is expected to reach 470 billion yuan [68 billion USD] in 2020. These numbers suggest a great future for the refrigerated distribution industry, but there are obstacles.

First, the industry is segmented and there is a lack of integration. Companies are small and scattered. Around 90% of the companies are regional. Few operate in bulk, and there are no refrigeration distribution and storage companies that can operate nationwide, let alone worldwide, in the sense that some companies in the USA do.

Second, the information infrastructure in the refrigerated distribution industry is underdeveloped. Refrigerated distribution differs from regular distribution in its requirements for sophisticated hardware, such as GPS, distribution network technology, and measuring equipment that tracks products every step of the way. This problem is not easily solved in the refrigerated distribution industry, as the information infrastructure in the regular distribution industry is not currently that well developed.

Source: Refrigeration Bulletin

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