Incheon Small Business Joint Logistics Center Doubles Participating Companies... Also Promotes 5-Hour Local Delivery

Incheon City is taking steps to reduce the delivery cost burden for small business owners who face difficulties with same-day shipping and delivery due to small-scale parcel volumes.

The city announced that starting from the 1st, it will expand the operation of the 'Small Business Joint Logistics Center,' which was the first of its kind nationwide last year, increasing the number of participating companies from 560 to 1,000.

Despite the activation of the online market, the majority of small business owners struggle to secure logistics competitiveness. While medium and large companies can negotiate lower delivery rates with courier companies, small business owners with low shipment volumes find it difficult to even establish delivery contracts. When contracts are possible, they have to bear relatively high delivery costs, and popular same-day delivery services are not available to them.

To alleviate these difficulties faced by small business owners, Incheon City proposed the 'Small Business Joint Logistics Center Construction Project' in the Ministry of Land, Infrastructure and Transport's 'Digital Logistics Service Demonstration' contest last year and was selected.

Since starting the project in July last year, the number of contracted companies increased from 133 to 560 by the end of December, and the delivery volume rose from 585 cases in July to 7,807 cases in December, confirming the increase in participation by small business owners and the project's feasibility.

This project features bundling the small shipment volumes from individual small business owners to collectively negotiate delivery rates with courier companies, thereby lowering delivery costs. It also improves logistics accessibility so that even small business owners shipping just one item can use the delivery service. Additionally, the collection system was enhanced by considering daily shipment volumes, enabling same-day delivery.

Incheon Small Business Joint Logistics Center Image [Provided by Incheon City]

When using general courier services in the market, the average fee for same-day delivery is 4,400 KRW, and for regular delivery, 3,520 KRW. However, by using Incheon City's Small Business Joint Logistics Center, same-day delivery within Incheon (excluding Ganghwa and Ongjin), Seoul, and Bucheon areas is available from 3,500 KRW, and nationwide regular and fresh delivery services start from 2,500 KRW and 3,500 KRW respectively. This is about 25% cheaper compared to the market average delivery fees.

Incheon City plans to expand the number of participating companies from 560 at the end of last year to 1,000 this year and support the production of affordable eco-friendly delivery boxes in the first half of the year. In the second half, it will also promote a collection system utilizing Incheon subway stations and pilot a 5-hour neighborhood delivery service.

An official from Incheon City stated, "We hope that through the joint logistics project, small business owners can reduce their logistics burden and expand their sales channels," adding, "We will upgrade the functions of the Small Business Joint Logistics Center by adding new projects that have never been seen domestically before."

This content was produced with the assistance of AI translation services.