Wang Wei’s journey from deliveryman to logistics tycoon of SF Express with over US$2.4 billion in revenue

Wang Wei’s journey from deliveryman to logistics tycoon

Staff Reporter
2013-02-19

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A rare photo of SF Express founder Wang Wei. (Internet photo)

Wang Wei is the low-key founder of SF Express, one of China’s two leading express delivery companies.

The 41-year-old Wang started SF Express nearly 20 years ago and has since developed the company into an delivery giant that recorded 15 billion yuan (US$2.4 billion) in revenue in 2011. Despite the extraordinary success of his company, Wang has said SF Express does not advertise and that he does not intend to take the company public or use it to make strategic investments. It is an attitude that has made Wang well-respected among China’s leading entrepreneurs, including Alibaba founder and chairman Jack Ma.

Wang was born in Shanghai in 1971 to a father who worked as a Russian translator for the air force and a mother who lectured at a local university. At seven, Wang’s family moved to Hong Kong, and after graduating from high school he joined the dye industry in Shunde, a district in Guangdong province’s Peal River Delta.

In the early 1990s, more than 80,000 Hong Kong manufacturers relocated to the mainland, 50,000 of them setting up in the delta. Sensing that the rapid increase in correspondence between Hong Kong and the delta was a great business opportunity, Wang borrowed 100,000 yuan (US$16,000 at current exchange rate) from his father and registered SF Express in March 1993. With only six staff members and a shop in Hong Kong, SF Express initially targeted the express delivery trade between Hong Kong and the Peal River Delta region.

Wang not only managed the business but also started off as a deliveryman like the rest of his staff. SF Express was able to quickly gain market share by undercutting its competitors on price, allowing the business to expand rapidly to other parts of Guangdong. The company was then able to establish a stranglehold on the Pearl River Delta through an aggressive franchising campaign, and by 1997 it had nearly absorbed all courier services from Hong Kong with a market share that reached 70%. Wang was still just 26 years of age.

In 1999, Wang began to take his business back from various franchise owners who had strayed from his control by delivering personal parcels and building their own local empires. The decision placed tremendous pressure on the business and even led to threats against his life. Since that time, Wang has had a contingent of bodyguards follow him wherever he goes.

SF Express successfully transformed from a franchise system to a more traditional operational model by 2002, with the company’s headquarters set up in Shenzhen. A year later, the outbreak of SARS placed significant downward pressure on airline charges, allowing SF Express to ink a favorable five-plane deal with an airline to become the first private courier company in China to deliver mail by air. At the same time, Wang narrowed the company’s focus to small parcels to avoid overlapping with major international express delivery companies such as DHL, FedEx and UPS.

At the end of 2009, SF Express won government approval to establish its own airline and bought two planes. With its new range, the company quickly recorded annual sales revenue of 15 billion yuan (US$2.4 billion) and employed 150,000 staff, according to 2011 figures.

The company has been able to maintain the quality of its service through a commission system that links pay to performance. A staff member also said that the company guarantees a minimum level of income and offers many subsidies and other benefits to employees and their families. As a result, the company has a very low staff turnover rate and more than half of its executives began their careers as low-level delivery staff.

Company managers say Wang is a workaholic who has regularly worked 14-hour days over the past 20 years. Those close to him say his aim has never been to simply amass a fortune, which is why he has turned down numerous acquisition offers from global couriers such as FedEx and UPS.

In recent years, Wang has kept a very low profile. He has given almost no interviews to the media and photos of him are extremely difficult to come by.

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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