Worried about the price reduction race in delivery, the floor is 'both playing football and blowing the whistle'

Leaders of VNPost Express and Viettel Post expressed concerns about competition in the delivery market, especially the monopoly of e-commerce platforms, including "establishing separate delivery units, monopolizing the delivery of goods".

People receive goods from delivery companies at a building in Ho Chi Minh City - Photo: HONG PHUC

Shrinking profit margins

The boom of e-commerce has become the main driving force behind the development of the postal and express delivery industry.

However, according to Mr. Le Viet Anh, General Director of VNPost Express , competition in the industry is increasingly fierce as businesses compete for market share. In particular, "e-commerce platforms also set up their own delivery units, exclusively delivering goods from sellers to buyers".

In the first quarter of 2025, VNPost Express recorded net revenue of more than VND 518 billion, an increase of 26% over the same period in 2024. However, the sharp increase in cost of goods sold caused gross profit to decrease to nearly VND 70 billion.

Along with that, interest expenses, sales expenses increased and other income decreased, leading to after-tax profit reaching only over 10 billion VND, down nearly 48% compared to the same period last year.

To maintain market share, VNPost Express's management board said it had to "adjust business mechanisms, increase promotions and deeply discount the entire system."

As a result, selling costs increased, pushing total costs in the last quarter up nearly 31%.

Meanwhile, Viettel Post Joint Stock Corporation's (Viettel Post) selling expenses in the first three months of this year increased by 37%, while business management expenses increased more sharply, up to 61%.

At a recent investor meeting, Mr. Nguyen Viet Dung, chairman of Viettel Post, said that many delivery businesses choose to compete on price, with a difference of only a few hundred dong per order, making up for the entire delivery experience, safety and quality.

This person commented that when there is no clear difference in quality, units rely on price to compete and this trend shows no sign of stopping.

According to an analysis report by Saigon - Hanoi Securities Joint Stock Company (SHS), last-mile delivery accounts for 28% of total freight costs in the logistics industry.

This market is increasingly vibrant, with the participation of many businesses such as GHN (Fast Delivery), BEST Express Vietnam, GHTK, J&T Express (Vietnam), Kerry Express (Vietnam), Nasco Logistics, Nhat Tin Logistics, Nin Sing Logistics (Ninja Van), Swift247, Viettel Post and VNPost.

Vietnam postal sector revenue in the period 2020-2024 - Unit: billion VND

With low-cost franchise models and superior feature-rich software, foreign businesses are creating great competitive pressure on price and service quality.

At the same time, large e-commerce platforms, mostly foreign-owned, prioritize orders to foreign delivery companies, adding to the challenge.

In particular, Chinese corporations such as Alibaba, Tencent, J&T, ZTO, SF, Ninja Van are promoting franchising, investing in infrastructure and reducing prices below cost to gain market share. Meanwhile, domestic enterprises are also racing to promote, causing profit margins to drop to only about 3%.

The floor is both the referee and the player?

At the 2025 Annual General Meeting of Shareholders, Viettel Post's leaders said that major e-commerce platforms in Vietnam have the exclusive right to decide on three important issues: products sold on the platform, shipping partners, and payment methods (cash flow).

These floors will control shopping behavior, charge high floor fees, leading to sellers having to increase selling prices, causing damage to consumers and domestic manufacturing enterprises.

The "all-in-one" ecosystem of some platforms includes e-commerce, shipping, payment... creating a seamless experience and optimizing efficiency.

However, this integration can potentially pose a conflict of interest, as exchanges act as both "arbitrators" (platform managers) and "players" (providing services such as delivery).

Nguyen Viet Dung, chairman of Viettel Post, said there are currently no official figures on the market share of e-commerce delivery. However, Viettel Post has a modest market share compared to major competitors such as Shopee Express and J&T, partly because large platforms such as Shopee and TikTok own or are closely linked to logistics units in their ecosystems.

Viettel Post has sent recommendations to state management agencies and contributed opinions when the management agencies were in the process of drafting the revised Postal Law, expecting the new regulations to help ensure the creation of a healthy and fair competitive market.

While waiting for new regulations, Mr. Dung said Viettel Post continues to negotiate and cooperate with major platforms such as Shopee and TikTok, and monitor the market to adjust strategies.

He said the cross-subsidy model between commerce and delivery is effective in the short term but not sustainable in the long term, and increasing platform fees could push sellers and consumers to more cost-effective platforms.

Read more Back to Topics

HONG PHUC

Source: https://tuoitre.vn/lo-cuoc-dua-ha-gia-trong-chuyen-phat-san-vua-da-bong-vua-thoi-coi-20250506235805434.htm