(Yicai Global) Nov. 29 -- The Netherlands, a country only two-and-a-half times the size of Beijing, has become an important hub for Chinese companies and commodities to enter the European market thanks to its mature logistics network and open market.
The country sits at the center of an area covering 170 million people within 500 kilometers that includes major cities such as London and Paris. Such geographical advantages have given rise to many local enterprises leverage logistics advantages and target Chinese manufacturers. Their stories and ways of doing business are the epitome of economic and trade interactions between China and the Netherlands and even those between China and Europe.
Although Bram Jan Streefland cannot speak Chinese, he set up a company called ViaEurope specializing in assisting Chinese cross-border e-commerce firm.
According to Streefland, more than 99 percent of the company's business comes from China, through the provision of customs clearance and logistics transportation services as well as last kilometer distribution.
The Dutch entrepreneur who idolizes Alibaba founder Jack Ma doesn't like to classify his company as a logistics firm, instead, he describes it as a scientific and technical corporation. The company handles around 2 million packages from China every month, with 98 percent of them sent on to other European countries from the Netherlands.
Over 90% of Goods Are Made in China
"For some Chinese goods, shipping to Germany via the Netherlands is not only faster but also cheaper than direct shipments," Ferry van der Ent, head of freight business at Amsterdam Schiphol Airport, told Yicai Global, adding that the foundation lies in the efficient logistics system in the Netherlands.
All goods from China can reach European consumers within 2 days of arriving in the Netherlands, Streefland told Yicai Global. "The plane arrives at Schiphol Airport at 7.00 a.m., with unloading completed and goods sent to our warehouse within four hours. The goods may be shipped to other European countries after sorting has been completed by 1.00 p.m," he said. Streefland hopes that goods may finish their journeys within 24 hours in the future.
Established in 2016, ViaEurope works with more than 20 Chinese logistics companies. Estimated operating revenue is around EUR20 million (USD22.6 million) this year, a near seven-fold increase on last year, he added.
Set up 2012, Dutch logistics company Fulfillment Solution runs a warehouse operated entirely by robots. They are capable of processing a single item in three to four seconds, which is at least six times the efficiency of traditional manual sorting.
While sorting is done by machines, packing is still done by hand so that the goods sent may be checked. As a result, the warehouse has an overall automation rate of about 70 percent.
The company provides warehouse and distribution platforms for e-commerce companies that want to explore the European market, with 12 business clients added in past year, making up about 30 percent of the total, FS head Steven Kershergen told Yicai Global.
Some 90 percent of goods sold to Europe through FS are made in China, and the company may ship up to 100,000 units a day at its peak.
The booming cross-border e-commerce in Europe also kept Chinese trade service companies busy. Shenzhen-based Baosen Suntop Logistics used to focus on traditional trade and got into cross-border e-commerce in 2014, according to company head Yang Hui, adding that his team works overtime seven days a week to maintain the transfer rate.
As a result, the company established a European subsidiary in the Netherlands to provide logistics, warehousing, customs clearance and declaration services for domestic customers to enter the European market, with enterprises such as Globalegrow E-commerce, Nintendo and Mobike among its list of clients.
Business from the e-commerce business makes half of volumes at the European unit. "Previously, only one to two containers coming from China arrived in the Netherlands in a week, while now you may see them every day," Yang said, adding that she hopes the company's Dutch transit warehouse may become a storage and display platform for Chinese products in Europe, and is also in talks to set up similar facilities in the UK and Germany.
Develop Dutch Logistics Boosts China Cooperation
China is the most widely acknowledged global market for the Dutch logistics sector, said Jasper Eggebeen, senior manager for supply chain solutions at Holland International Distribution Council.
Eggebeen led a logistics delegation of 30 companies to Guangzhou, Chongqing and Shenzhen this year, aimed at enhancing cooperation and communication between the two countries. He visits China three to four times every year and plans to visit more cities including Shanghai and Hangzhou next year, he told Yicai Global.
Government delegations from Shanghai and Chongqing have also visited the Netherlands more frequently. A delegation from Chongqing Pilot Free Trade Zone made a special visit to Rotterdam to seek out expertise in November.
The Port of Rotterdam is the largest port in Europe and 22 percent of its annual freight volume comes from Asia with China taking up 80 percent. The China Railway Express service has been launched and the number of service lines are increasing, which boosts the port's throughput, according to its Information and Communication Officer Maarten van Oosten, adding that a large quantity of cargo from China go to other European countries such as Ireland.
"The Port of Rotterdam is nicknamed the Port of China, because one fourth of its container trade is related to China," said Zhang Min, business manager for China at the Rotterdam Partners' International Trade & Investment department, told Yicai Global. The port is not only a portal to Europe but also can save up to half of logistics times if US-bound Chinese commodities go through it, she added.
China was the EU's largest partner last year and the Netherlands imported EUR83 billion (USD94.4 billion) from the country in 2017, the most among EU countries, according to Eurostat.
Automobiles are the EU's most-exported products to China, while telecommunications equipment is the main product the EU imports from China. Chinese auto giant BYD has established its European headquarters in the Netherlands and has sold more than 600 electric buses in the region.
Electric forklifts, besides electric buses, make up about 30 percent of BYD's European business. BYD's forklift team have spent three years developing electric forklifts for the European market before releasing it in 2015, Feng Jihua, BYD's head of European forklift business, told Yicai Global, adding that its forklift business has been doubling year over year since then.
It is possible to reach almost all European destinations from Netherlands within three hours by plane, making it a suitable location for providing spare parts to customers within 24 hours, Feng explained.
Broekman Logistics is BYD's partner for storage and logistics in the Netherlands and enables BYD to dispatch goods within one hour of receiving orders. It also helps BYD inspect and refit the products stored in the Dutch warehouse.
Rising Chinese Imports From Europe
China takes up 11 percent of the EU's total exports to non-EU countries and regions and is the EU's second largest export market. As China accelerates its opening up, China's imports from the Netherlands and Europe are also rapidly on the rise.
China's imports of agricultural and side-line products has increased 20 percent to 30 percent per year, while China Certification & Inspection Group Netherlands is capable of testing European products and can provide technical support to customers in a timely manner, Fan Lifang, the firm's general manager told Yicai Global.
Products at CCIC Europe's overseas warehouse are labelled with a CCIC Europe Certificate of Origin anti-counterfeit label after inspections, and outgoing postal parcels can be attached with express sheets featuring QR codes to better provide security during transit, he added.
China's first listed supply chain firm Eternal Asia Supply Chain Management signed a purchase intention with Royal FrieslandCampina for fast-moving consumer goods and foodstuffs worth over CNY1 billion (USD144 million) at the first China International Import Expo held in early November in Shanghai. Philips also signed a CNY200 million order with a Beijing medical device trader at CIIE.
"Prime Minister Li Keqiang asked about my opinion on doing business in China and I told him China is a key market," Thierry Vanlancker, chief executive at Akzo Nobel told Yicai Global.
Akzo Nobel is an international paint and coatings firm based in the Netherlands, and its business in China makes up about 16 percent of its global business, making it the company's largest single market worldwide.
The firm started up operations this year at a EUR40 million (USD45.5 million) plant in Changzhou, Jiangsu province, which will be the Akzo Nobel's largest powder coatings facility globally, Vanlancker added.