Hypothesis: Development and Model Innovation in the Dedicated-Route Less-Than-Truckload Sector

For the less-than-truckload (LTL) transportation industry, under the broader backdrop of a sluggish manufacturing sector and rising labor costs, operating dedicated routes has become increasingly challenging.

01 Concerns of the Traditional LTL Model  
In March 2023, the China Highway Logistics Freight Index, compiled by the China Federation of Logistics and Purchasing, stood at 103.4 points. Among the less-than-truckload (LTL) indices, the LTL light‑cargo index registered 102.9 points, down 0.87% from the previous month. Rather than the substantial business growth anticipated after the start of 2023, the industry has instead faced increasingly intense price competition. Many manufacturing firms and large third-party logistics providers opted to re-tender during this period, with price emerging as the dominant factor in competition, while numerous dedicated‑line logistics companies found themselves hovering on the edge of… Between profit and loss.
Highway LTL Dedicated Line In 2023, cargo volume declined by approximately 20%. After a decade of market development, customer expectations for service quality and efficiency have continued to rise, while competition among peers has grown increasingly fierce. Take less-than-truckload (LTL) logistics as an example: a single dedicated route may host dozens of LTL carriers, resulting in severe homogenization. When price differences are minimal, customers often opt for the carrier that offers superior service.
For most dedicated‑line operators, profitability hinges entirely on the availability of cargo; they lack the hallmarks of standardization, platformization, and network integration. Relying on traditional business models, these companies continue to see their margins squeezed by high operating costs, while competitors driven by relentless innovation capture market share, leaving them increasingly ill‑suited to today’s competitive landscape.

02 Current challenges faced
With labor costs remaining stubbornly high and increasingly stringent regulations on tax‑related outsourcing taking effect, emerging players such as Aneng and Yimidida, along with established firms like Jiaji, Huayu, and Shenghui, as well as major express‑delivery platforms including ZTO, Shunxin, and Best, are all facing mounting pressures. ……all of these exert a certain degree of market pressure. As for dedicated‑line logistics, the overall market pie may be limited, and the share available to each player is steadily shrinking.
In the less-than-truckload freight market, it is positioned at Small and micro LTL carriers, which occupy a pivotal position, likewise require well‑designed models to guide their development.
Therefore, although small and micro LTL logistics enterprises still have a foothold in the market today, in the future, as customer service expectations rise, large and medium-sized enterprises refine their networks, establish robust platforms, and mature their business models, In the industry “One desk, one phone, and one vehicle”–such small‑scale LTL carriers will become increasingly rare, to be replaced by a fragmented market dominated by a handful of industry‑leading LTL operators.
Going against the current, one either advances or regresses.
Of course, small and micro LTL carriers will continue to have their own market presence and value in the future. In China’s road freight market, shippers’ needs are tiered, which means that each segment must be served by a corresponding business model.
However, overall, the development of less-than-truckload (LTL) transportation enterprises has entered The stage of “rowing against the current—stand still, and you will be swept backward.” Over the next two years, most less-than-truckload (LTL) carriers will face the challenge of a major industry reshuffle.
When you start a route, business picks up and everyone jumps in—employees, drivers, and others—all joining the rush to operate that line. As a result, cargo volumes get diluted, and life becomes increasingly difficult.

03 The model requires innovative development.  
Whether a company can innovate its business model determines its survival and growth. As the industry undergoes transformation and upgrading, dedicated‑line services are also exploring ways to establish their own business models—much like Jack Ma’s efforts to build… Like “Cai Niao Wang,” no one can say for sure whether it will succeed in the future, but change is something that must be undertaken.
In what directions should LTL transportation companies innovate their business models?
First, we will pursue refined and standardized operations and develop high-value-added products.
Second, adopt alliance‑based, networked operations to share costs and pursue profitability.  
Seek improvement from within and drive efficiency through better management.
The standardized operating model deserves recognition. By “standardization,” we mean starting with ourselves—integrating and enhancing our own capabilities. As customer demands continue to evolve, LTL carriers must likewise strengthen their management, technological, and operational competencies to meet new requirements and adapt to the changing business environment.
Debang Logistics is a model of standardized operations, with its store design, vehicle branding, site selection, and transportation services all implemented according to standardized procedures.
Meanwhile, by targeting high-end customers and establishing premium brands in low-end, labor-intensive industries, the company has secured business with greater profit margins.
Seeking externally, pursuing collaboration.
Industry alliances are the trend. Their operational effectiveness remains to be validated by the market. The biggest challenge facing the sector is the weak risk resilience of small and micro‑specialized lines; small businesses need such alliances. Consequently, companies like Ka Xing Tian Xia, An Neng, Ju Meng, Tian Di Hui, and Shang Qiao are all moving in this direction. “But nothing is absolute; one cannot simply conclude that the collective is good and the individual is bad.”
As for the direction of transformation in the less-than-truckload (LTL) business model, two major trends are emerging: freight alliances and fourth-party logistics platforms. Consequently, for small and micro‑specialized carriers, unless they have already established a strong brand and achieved critical mass, the era of going it alone is over.
In addition to the aforementioned directions, dedicated lines can also focus on specific niche segments, such as e‑commerce, last‑mile delivery, home appliances, automotive parts, and more. By innovating technologies and service models within these niches and building strong brand equity, they can stand out in a new environment marked by heightened competition.
The market is transitioning to highway express delivery.
Over the past few years, the most significant changes in the road transportation market have occurred in the less-than-truckload (LTL) segment.
Aneng, Yimi, Shentong, Shunxin, Zhongtong, and Anji Huayu have all been pioneering in this sector, sparking a fierce battle over products, brands, services, and store networks. It can be said that, in the less-than-truckload (LTL) market, road express freight has become the industry standard, driving a revolutionary transformation in this sector.
Thus, the à la carte dedicated line service has suffered a devastating blow.
From the development trends of highway express freight and Looking at market developments since 2016, the next phase of growth will see the dedicated‑line market transition toward highway express freight. This conclusion is primarily based on the following considerations:
I. From the perspective of external demand, the dedicated line service requires an upgrade in both service quality and branding. Although the dedicated line is small in scale and essentially operated by individual entrepreneurs, it primarily serves large clients through freight forwarders. In China, Among the Fortune 500 companies, despite their formidable brand reputations, most rely on these individual operators for transportation, as the majority of third-party logistics providers lack their own transport networks.
Due to the high complexity of selecting and managing these dedicated routes, customer satisfaction is in fact very low. Many third-party logistics providers are urgently seeking the emergence of branded, service‑oriented dedicated lines in the market.
II. From the perspective of internal development, the dedicated line itself requires transformation and upgrading. The operating environment for dedicated-route services is steadily deteriorating. From the suppliers’ perspective, drivers’ wages have been rising year after year; today, a long-haul truck driver’s salary has already increased to… It’s around 8,000 yuan now. Fuel prices have risen by 50% over the past few years, and site‑rental costs have been steadily climbing due to urban redevelopment requirements; this has translated into frequent relocations for dedicated routes.
From the customer’s perspective, with severe homogenization in dedicated‑line services and the ability to switch providers at any time, their bargaining power is very limited, making it difficult to raise prices. Moreover, they are often forced to front substantial capital expenditures. From a competitive standpoint, investing in a single dedicated line can cost as little as several hundred thousand yuan, and new competitors continually enter the market.
Meanwhile, the dedicated line’s own expenses—such as rent, labor, and other operating costs—are steadily rising, further increasing operational risks. In the central-city dedicated‑line market, rental rates have reached… At a rate of RMB 110 per square meter per month, under these circumstances, dedicated lines have also been compelled to seek new avenues for breakthroughs, hoping to extricate themselves from this predicament.
III. Drawing on the development trajectories of other industries, the dedicated‑line market is poised to evolve toward a highly concentrated structure. If we draw an analogy with other sectors in China, they have all undergone a similar transition—from fragmentation to concentration. For instance, small independent guesthouses have gradually been replaced by chain hotels; local same-city delivery services have given way to nationwide courier networks; and mom-and-pop retail shops have been supplanted by large chain stores. Likewise, today’s highly fragmented dedicated‑line market will inevitably be overtaken by new, increasingly consolidated business models.

04 Development History of the Dedicated Line
Based on current market trends, the direction of dedicated‑line transformation and upgrading is toward dedicated‑line consolidation hubs—centralized operations at a single location that serve networks of dedicated lines covering major cities nationwide, offering customers end-to-end solutions under a unified brand and standardized framework. In fact, we are already witnessing this trend in the market, with various types of consolidation models emerging one after another.
The dedicated‑line market is the backbone of China’s road freight sector, and in the coming years, it will give rise to numerous facilities akin to consolidated‑freight hubs.
Consolidating on a single node yields twice the results with half the effort, so… Since 2018, the alliance has largely focused on building centralized sorting hubs; the scarcity of land resources, coupled with the inability of small and micro‑specialized lines to invest in land and the logistical convenience of consolidating shipments for transshipment, have all made sorting a central priority.
However, due to their aggressive strategies and underlying instability, both Kaxing Tianxia and Shangqiao faltered along the way. From the very inception of Kaxing Tianxia… — a founder with deep logistics expertise, seasoned by years in the industry, and an overseas‑return executive; a perfect match of two exceptional talents. An ambitious, game‑changing plan, backed by Cainiao—the king of logistics investment—and favored by Zhongding—everything seemed so promising. Yet in the blink of an eye, nine years have passed, and the reality now feels far removed from what we had envisioned.
Born with a silver spoon in one’s mouth.

We are not blaming anyone; after all, KaXing has profoundly influenced many in the logistics industry and developed its own distinctive ecosystem theory. Perhaps the vision was sound—yet significant discrepancies arose during implementation. From President Zhai’s painstaking efforts to build KaXing, to Qian Yu and Zou Yu’s tireless, event‑after‑event outreach campaigns, it seems that, in practice, they have grown increasingly distant from the vast majority of dedicated‑line operators.
Then become a financial company.
From its positioning as a transit‑goods hub, to a park‑level service platform, and then to a card‑processing service center, the card‑processing business’s strategic positioning appears to have been in constant flux—along with its organizational structure and operational framework.
The final performer was Shenzhen’s hundred-billion‑yuan commercial factoring firm, CICC Wulian ( P2P), and then Card Bank suddenly transformed into a financial institution. To lock in its franchisees, it deployed a trump card: credit lines. Joining Card Bank came with a guaranteed credit limit—after all, specialized networks are cash‑strapped, yet most banks shy away from such light‑asset enterprises. So what risk‑control measures could we employ?
Of course, it’s easy to talk the talk; but running a business is far from simple, and operating in logistics is even more challenging—doing logistics in China is doubly difficult. A capable leader may spot an emerging trend, happen to adopt a relatively advanced business model, and rally a team to pursue it together. Yet the outcome is by no means guaranteed: unexpected shocks like global economic crises, fierce industry competition, disruptive new models from cross‑industry entrants, or internal organizational friction can all upend the landscape overnight, reshaping the entire playing field.

05 Analysis of the Future Development of China’s Less-Than-Truckload Logistics
Less-than-truckload (LTL) express delivery has become the focal point of competition, with fierce market battles raging.
Express delivery has now become the focal point of competition across the entire road freight industry, and it is… A notable trend over the past five years has been the transformation of contract logistics into less-than-truckload (LTL) express transportation. , some have entered the express‑to‑less‑express delivery market, such as Best Express and Yafeng Express; There are also those that have transitioned from dedicated lines and from air freight. ; Even those aspiring to become integrated logistics enterprises have made less-than-truckload (LTL) express delivery their core business. A host of companies—including Jumeng, Yunpai, Huolangbang, Kelaoyouwang, and Transfar—have entered this market.
This has turned the less-than-truckload (LTL) express delivery market into a hotly contested battleground. Fierce competition in this sector is bound to shape the landscape of LTL express services. In 2019, the battles for branch network expansion, customer acquisition, marketing, talent recruitment, and even capital will unfold in waves, continuing throughout the entire year.
Affected by the macroeconomic environment, the overall development of less-than-truckload (LTL) freight has slowed.
Despite increasingly fierce market competition, the less-than-truckload (LTL) market is still growing. It began to slow down in 2013.
The reasons are twofold: first, a decline in cargo volume; second, rising costs.
Overall, In 2018, weighed down by macroeconomic conditions, less-than-truckload (LTL) express carriers that operate a network of company‑owned branches saw only modest revenue growth, with some even remaining flat or declining slightly. Nevertheless, the industry leader, Debang, maintained robust growth in 2019: despite already operating at a scale of over RMB 10 billion, it still achieved a 20% year‑on‑year increase, largely driven by Debang Express’s formal push into the express delivery business.

2022 Ranking of Road Transport Enterprises

The LTL market is showing a clear trend toward segmentation: Debang and SF Express dominate the high-end, small‑parcel segment, while Aneng and Best Express are capturing the mid‑range, low‑price segment. Low‑value shipments are handled by regional networks led by Henan Yuxin and Changtong Logistics, while larger, higher‑value loads are primarily transported by dedicated‑line carriers.

Franchising has become a prevailing trend, running alongside the company‑owned model, but its growth has slowed.
The rankings reveal that the rapid expansion of new franchise-based LTL express carriers is… A major highlight of 2018.
From At the 2013 Yunlian Summit, the debate between direct operation and franchising has given way to a new type of LTL alliance model—exemplified by Jumeng—that has achieved rapid expansion and robust growth. Today, LTL alliances have become one of the industry’s mainstream organizational structures.
Regional LTL business is experiencing robust growth, with continuous innovation.
Regional LTL freight is experiencing robust growth, driven on the one hand by an expanding network that now reaches county‑level cities and even rural towns and villages, and on the other by continuous improvements in operations and management. In particular, regional LTL carriers enjoy strong competitive advantages in third- and fourth‑tier markets.
Unlike nationwide, network‑based LTL carriers, regional network operators typically lack the resources and opportunities to invest heavily in building a pan‑China network. Consequently, they opt to deepen their presence within their home provinces, achieving connectivity between provincial capitals and county seats and extending their service points down to the county and township levels—strategies that serve as key pillars for establishing competitive barriers.
At the most fundamental level, a logistics alliance establishes its objectives and development roadmap from the outset. For instance, Liaoxi, Feiteng, and Sanzhi each have defined areas of influence, as reflected in their network of service outlets and distribution hubs. Therefore, when operating across regions, the alliance must take into account the local brand’s market presence and influence.
Whether the alliance’s core interests are driven by scale or by profitability requires you to first analyze the existing members’ order‑volume mix and per‑vehicle profit structure, and then make an informed judgment.
LTL dedicated lines are facing management upgrades and a shift in business models.
Less-than-truckload In the Top 30 ranking, Yuxin, Changtong, and Tengda made the list. Network‑based LTL carriers primarily handle small‑parcel LTL shipments (30–300 kg per shipment), and a number of leading large enterprises have emerged at the top of the rankings. Meanwhile, Dingdian Zhidao’s dedicated routes are the mainstay in the large‑parcel LTL market (shipments exceeding 300 kg per consignment). Despite being the less-than-truckload market Carriers handling 90% of the industry’s freight volume often operate as small and medium-sized enterprises. Breaking away from the traditional point-to-point transportation model and overcoming conventional management bottlenecks are essential prerequisites for specialized‑line carriers seeking to scale up.  

Generally speaking, the number of service points is not the core strength of a dedicated line; rather, the frequency of departures is a key metric for evaluating such services. The dedicated‑line operators that have stood out this time have all moved beyond the traditional point-to-point model—some even operate on a region-to-region basis. The “dumbbell” model, along with the “fan‑shaped” configuration that connects a single point to multiple regions, reflects evolving logistics trends. Against the backdrop of fragmented LTL orders and increasingly lightweight waybills, timely transformation and upgrading of dedicated LTL routes have become an imperative for businesses.
Industry consolidation has already begun, and capital inflows are accelerating.
The trend toward consolidation in the less-than-truckload (LTL) express delivery sector is accelerating, and the industry’s fragmented, small‑scale, weak, and inefficient structure is undergoing transformation. Mergers, acquisitions, and organizational innovations will continue to emerge: On the one hand, industry giants such as Debang and SF Express are continuously expanding into new business segments, while ancillary services from the express delivery sector are also gradually entering this market. On the other hand, numerous small and medium-sized enterprises are actively seeking to form alliances or partnerships—not merely as a passive strategy to pool resources in response to economic slowdowns, but also as an objective necessity for achieving greater operational efficiency amid intense competition.
As investment in the deployment of enterprise network locations and the construction of distribution centers accelerated, the less-than-truckload (LTL) express delivery sector saw a decline in overall investment in 2022; meanwhile, digital freight forwarding experienced rapid growth.

On March 9, 2023, Lugu listed on the Hong Kong stock market, and Huolala is expected to go public in the U.S. in April 2023.

SF Same-City ( 002352.SZ) and Yinfei Storage (603066.SH) followed closely, posting gains of 23.15% and 20.43%, respectively. With their market capitalizations rising, SF Same‑Day Delivery has shaken off the gloom of recent months, now boasting a total market cap of RMB 7.001 billion. Meanwhile, Yinfei Storage and Tianyuan Shares (003003.SZ) are the only two companies in the logistics‑technology sub‑index to see their market caps increase.
In 2022, a total of nine companies saw their market capitalization rise, with Debang Shares leading the annual gainers list at 103.62%. Today International and Yinfei Storage followed closely, posting gains of 31.41% and 28.1%, respectively. Lanjian Intelligent (688557.SH), Changjiu Logistics (603569.SH), YTO Express, STO Express (002468.SZ), Tianyuan Shares (003003.SZ), and Xinning Logistics (300013.SZ) also recorded varying degrees of market-cap appreciation in 2022.
On the annual list of market-capitalization gainers, Xinning Logistics is also undergoing a strategic shift. On July 31, 2022, Xinning Logistics officially announced a proposed private placement. Under the plan, the company intends to issue 111,671,779 shares at a price of RMB 3.75 per share to Dahe Holding Co., Ltd., raising a total of RMB 419 million. The ultimate controlling shareholder of Dahe Holding is the Department of Finance of Henan Province.

In December 2022, Kuagou Dache topped the list of stock price declines, with its market capitalization shrinking to just RMB 1.88 billion.

2022: 18 companies saw their market capitalization decline, with 16 posting year-to-date drops exceeding 10%; Best Inc. led the pack with an 88.2% plunge.
In terms of the decline, In December 2022, the market capitalization of 14 logistics companies declined, with 12 of them posting losses of less than 10%, and several showing only marginal declines.

Among them, Kuagou Dache’s market capitalization declined compared to the previous month. With a 25.81% decline, it topped the list of decliners, and its market capitalization fell below RMB 2 billion to RMB 1.88 billion—whereas last month its market cap had surged by 59.79%. KJ Intelligent followed closely with a 10.46% drop; these two companies were also the only logistics firms to post monthly declines exceeding 10%.
Tongda Group of Companies In December, market capitalizations all posted varying degrees of growth, with Yunda Express (002120.SZ) recording the largest increase at 16.91%. Shentong Express, meanwhile, saw a modest 1.27% rise in market value compared to the previous month.
In 2022, among the companies tracked, 18 saw their market capitalization decline, with 16 posting year-to-date drops exceeding 10%. Notably, Kuagou Dache and Best Inc. (BEST.US) led the pack, with declines of 83.95% and 88.2%, respectively. Closely following were SF Same‑Day Delivery (09699.HK) and ANENG Logistics (09956.HK), both of which posted year-to-date losses surpassing 50%.

In addition, since the beginning of this year, Alibaba, the largest institutional shareholder of Kuagou Dache, has been steadily reducing its stake. According to the latest disclosures from the Hong Kong Stock Exchange, On December 7, 2022, Alibaba once again reduced its holdings by 902,600 ordinary shares, bringing its stake from 13.11% to 12.97%.

06 Innovation Business Segment
Innovation in the less-than-truckload (LTL) logistics sector is extremely challenging, owing to the industry’s lengthy value chain. For instance, well‑established players such as Tiandi Hui Supply Chain, Aneng Logistics, Kaxing Tianxia, Jumeng Logistics, and Yimidida have all sought to differentiate themselves. Beyond the fundamental logistics components, these companies have expanded into areas like information flow (through system integration), financial services (including micro‑loans), and upstream–downstream supply‑chain integration—covering initiatives such as vehicle sales, specialized tire supply, commercial factoring, brand standardization, joint last‑mile delivery, drop‑and‑hook transportation, and industrial park consolidation, among others.
1. Innovative Models in the Transportation Sector
Humpback transport
Since transportation costs account for a significant portion of the logistics trunk line’s… With a market share exceeding 50%, reducing trunk‑line transportation costs has become the top priority in the long‑haul logistics sector—examples include Tiandi Hui’s drop‑and‑hook operations, Tuofeng’s humpback transport, and Manbang’s adoption of digitalized drop‑and‑hook solutions pioneered by Zhihong.
2. Enter the commerce and trade sector and gain control of orders.
Logistics is a foundational service industry; in addition to transporting goods, it also bears the responsibility of delivery and settlement. However, due to a lack of trust and opaque financial flows, the collection‑on‑delivery business faces significant challenges. How to achieve greater transparency in fund management is therefore one of the key areas for innovation.
Credit and Credit Reporting
Payment transactions are anchored in the logistics waybill context, and early identification of emerging signs of high‑frequency credit risks in the industry has significantly strengthened credit management capabilities. The risk‑assessment model incorporates indicators such as letter‑of‑guarantee transaction data, product inventory, sales volume, transaction workflows, and transaction frequency, as well as multi‑dimensional customer data including favorites, ratings, and complaints.
3、 Shangqiao Unitization
On medium- and short-distance routes, Shangqiao has tackled cost and efficiency challenges by deploying modular, compartmentalized vehicle units. This model, which they market externally as the “bus‑cargo van,” has delivered highly successful results in its first few months of operation. According to Chen Fengyu, in terms of costs, the bus‑cargo van is cheaper than dedicated freight services. 35%, which is 50% lower than that of peer internet companies.