Masayoshi Son to bring Coupang's delivery system in Japan
SoftBank founder Masayoshi Son / Korea times file
By Kim Jae-heun
SoftBank Chairman Masayoshi Son is thinking of introducing Coupang's overnight delivery system in Japan through his e-commerce firm Yahoo Japan.
During an interview with a Japanese television news program on Monday, Son said he is in talks with Yahoo Japan to review the possibility of introducing Coupang's overnight delivery system there.
Reuters also reported that Son will adopt Coupang's system through SoftBank's subsidiary Z Holdings. SoftBank said that the chairman wants to open a Coupang-like service in Japan rather than launching Coupang itself there.
SoftBank is the biggest investor of Coupang, which its venture capital fund Vision Fund spent over 3 trillion won to acquire a 33.1 percent stake in the e-commerce firm.
On March 1, Naver's Japanese subsidiary Line and SoftBank's Yahoo Japan launched the joint venture Z Holdings in Japan to raise competitive power against No.1 player Amazon Japan and No.2 player Rakuten.
Naver said it will open its Smart Store platform in Japan in the first half of this year. But Son believes this is not enough.
Amazon Japan has already adopted a same-day delivery system for premium membership customers, who can also designate the day they want to receive their orders. The service delivers fresh food orders within two hours at the fastest and overnight at the slowest ― although this service is limited to certain areas.
This led Amazon Japan to surpass Rakuten and dominate the local market back in 2010. Son believes Coupang's overnight delivery system could raise Yahoo Japan to the level of Amazon Japan and Rakuten. But Yahoo Japan still has a lot of catching up to do.
The biggest problem lies on the logistics system, working environment and culture differences of the customers.
In Japan, delivery drivers have to deliver directly to the customer, hand to hand. According to Japan's Ministry of Land, Infrastructure, Transport and Tourism, delivery drivers have to come back later to complete the delivery in 11.4 percent of cases.
In Coupang's case, its overnight delivery system here is possible because workers can just drop items at customers' front doors.
Japan's biggest logistics firm Yamato Logistics has established 5,400 safe drops across the country to resolve the issue, but Japanese customers are still uncomfortable with the system.
There aren't enough delivery workers in Japan, either. Japan's transport ministry said the country will lack 240,000 delivery vehicle drivers in 2027.
Nonetheless, Japan's e-commerce market is desirable as its size ranks fourth after China, the U.S. and the U.K. Japan's Ministry of Economy, Trade and Industry said the online market grew by 6.76 percent to reach 19.3 trillion yen (200 trillion won) in 2019 compared to the previous year.
The COVID-19 pandemic has boosted the transition to online shopping, but the e-commerce market still comprises only 7.9 percent of the total. This means the market still has more to grow.