In Nanhe District, Hebei Province, 80,000 out of its 390,000 people are engaged in the pet food industry, which accounts for a market share of 60% in the country. Hailed as the “town of pet food in China,” Nanhe is home to over 4,000 online stores, with total e-commerce turnover reaching RMB1.4 billion in 2019. Facing the weaknesses in warehousing and logistics, local governments and private sectors worked together to build a systematic value chain upgrading plan based on field surveys, trying to promote warehousing at production sites to foster synergy with talent training, market branding and live streaming e-commerce. In June 2020, a warehouse of 11,200 square meters was put into use. With a designed peak capacity of 100,000 orders, the warehouse handled an average of over 20,000 orders per day within six months after it came into operation. The logistics costs of enterprises declined by 20%, and their operating costs were effectively controlled. Direct shipment from the warehouse has also greatly improved the logistics efficiency. In addition to the basic functions like sorting, inspection and quarantine, warehousing and logistics, the warehouse in Nanhe has also served as an operating platform for e-commerce live streaming and brand marketing, laying solid groundwork for the upgrading of the local pet food industry.

Warehousing at production site in Nanhe District. “Warehousing at production site” means that large retail and logistics enterprises establish a warehouse adjacent to the place of origin and suppliers transport goods to the warehouse, which helps reduce logistics costs.

Excerpt from: Sci-Tech Empowering Rural Transformation Report 2022: Digital Technology Empowers Agricultural Value Chain Development