(Yicai Global) March 28 -- The new errand-running service that Chinese on-demand trucking services provider Huolala launched yesterday may run into problems, according to an analyst.

Huolala will have to deal with its rider headcount first, which lags behind other firms offering errand services, Chen Liteng, an analyst at the e-commerce research center of 100EC.Cn, told Yicai Global. As a main feature of this type of service is speed, Huolala will need to reach a certain transportation capacity to be effective, he added.

Huolala, which has experience in the same-city delivery business, kicked off the new service in Shanghai and Shenzhen yesterday, earlier than planned. The Shanghai-based firm began collecting rider registration and user data at the beginning of this month. To attract riders, it will not take any commission until August and will award multiple bonuses to riders.

The errand running market is saturated, and many companies have already consolidated their position, so it is difficult for newcomers to become users’ first choice, Chen noted.

Meituan Paotui, the errand-running service of food delivery giant Meituan, is the most used, seizing a market share of 60.1 percent, followed by Alibaba Group Holding's Ele.me Paotui at 29.8 percent and local platform Shansong at 27.8 percent, according to data from iiMedia.Cn.

Efficient matching of supply and demand based on rider numbers also requires long-term data and experience, Chen pointed out.

Huolala's overseas arm LalaMove provides delivery services by connecting users in Southeast Asia and Latin America with delivery drivers on its mobile app. Its errand business is very mature, the manager in charge said.

Errand services help individuals and businesses who do not have time to complete chores. China's market for such services is expected to reach CNY66.4 billion in 2025, up from CNY13.1 billion (USD1.9 billion) in 2021, according to iiMedia.Com.

Editors: Shi Yi, Futura Costaglione