The Shocking Logistics Crisis Sweeping Cross-Border E-Commerce: Lessons From a Top Freight Forwarder’s Collapse

Starting in late May, an abrupt logistics crisis has sent shockwaves through the entire cross-border e-commerce industry. Feng Logistics, a leading freight forwarder backed by SF Express and DHL supply chains and an official authorized logistics partner of the mainstream cross-border T-platform, suddenly suffered a full-scale operational paralysis, leaving massive volumes of sellers’ shipments stranded across the country.

This sudden collapse triggered nationwide logistics stagnation starting from late May, covering major cross-border hubs including Yiwu, Shenzhen, Jinhua and Foshan. Countless sellers saw their logistics tracking grind to a sudden halt. Some sellers reported that large-sized goods picked up in Guangdong on May 26 completely disappeared with suspected loss. A huge number of shipments were trapped indefinitely in Jinhua transit warehouses. Over a hundred cartons of goods received no further logistics updates after arriving in Foshan on May 29.

Yiwu and Shenzhen bore the brunt of the cargo backlog, with multiple service outlets forced to suspend operations entirely. After extensive inquiries, sellers confirmed that the widespread shipment stagnation was not a routine delivery delay, but a direct consequence of a severe financial dispute between Feng Logistics and the cross-border T-platform. On-site pickup staff frankly informed sellers that all goods were temporarily detained due to the corporate conflict between the logistics provider and the platform, and shipment release would only take place after a final negotiation settlement.

To make matters worse, Feng Logistics was also plagued by severe internal salary arrears. Frontline drivers and delivery staff revealed prolonged unpaid wages with no resolution, leading to widespread passive work stoppages. Relevant regulatory authorities have since intervened to coordinate and handle the incident.

The Root Cause: Cash Flow Crisis Under the Fully Managed Model

On the surface, the sudden breakdown of Feng Logistics stems from a commercial dispute between two enterprises. Fundamentally, it exposes the core risk of the fully managed platform model, where operational and cost risks are entirely shifted to downstream logistics service providers.

The platform’s ultra-low pricing strategy is sustained by every link of the upstream supply chain. Logistics providers bear full upfront costs for domestic cargo pickup, sorting and trunk transportation, coupled with extended payment cycles of over 60 days. Compounded by frequent penalty clauses for substandard delivery timeliness, logistics companies are pushed to the brink of cash flow exhaustion.

While massive freight fees remain pending as virtual figures on platform accounts, logistics firms face rigid daily cash expenditures including driver salaries, warehouse rents and fuel costs. When accumulated platform arrears overlapped with internal wage gaps, Feng Logistics resorted to the extreme and harmful measure of detaining shipments as leverage, leaving innocent cross-border sellers as the ultimate victims.

Although rumors emerged that suspended Shenzhen outlets would be taken over by Kuayue Express, the situation remains far from optimistic. Industry insiders point out that cross-enterprise cargo inventory verification, data alignment and warehouse handover are extremely cumbersome processes, requiring a minimum of half a month for full reorganization. For time-sensitive cross-border e-commerce businesses, a two-week delay is enough to completely eliminate the market competitiveness of best-selling products.

Frequent Logistics Collapses: A Growing Industry Trend

The downfall of Feng Logistics is by no means an isolated incident. In the past two years, the cross-border logistics sector has witnessed continuous crises: the bankruptcy and liquidation of well-established Jia International, the sudden business suspension of Ding Supply Chain, and Yiwu Tong Logistics’ cargo detention incidents caused by overdue shipping fees after predatory low-price order grabbing. Every collapse has resulted in devastating financial losses for countless sellers.

Most alarmingly, the crisis tide is no longer limited to small and medium-sized freight forwarders but has spread to top-tier industry service providers.

Facing escalating logistics risks, cross-border sellers must adopt proactive risk prevention strategies. First, implement diversified logistics layouts and build multi-channel backup systems to disperse cargo operational risks, avoiding over-reliance on a single supplier. Second, shorten payment cycles with logistics partners to prevent long-term occupation of working capital. Third, reject blind pursuit of ultra-low logistics prices, as below-market quotations invariably conceal hidden risks and operational traps.

The Industry Calls for Standardized and Fair Cooperation Mechanisms

As of June 5th, negotiations between the T-platform and Feng Logistics are still ongoing. No official solutions to the dispute or confirmed schedules for full cargo delivery have been released, leaving the fate of massive stranded shipments completely uncertain.

This incident sparks profound industry reflection: it is unreasonable and irresponsible for platform and logistics provider commercial disputes to be resolved through detaining innocent sellers’ goods. Throughout this crisis, cross-border sellers have undoubtedly endured the greatest losses and injustice.

To avoid platform penalties for delayed shipments, numerous sellers were forced to restock urgently and resend orders via alternative logistics channels, bearing double costs for both goods and freight fees. Some merchants calculated losses of nearly one million RMB from stranded cargo and emergency air freight replenishments. For small and medium-sized sellers surviving on thin profit margins, such losses are virtually catastrophic.

A thriving cross-border e-commerce industry relies on a healthy and sustainable logistics ecosystem. If mainstream platforms continue to transfer operational pressures and risks to downstream suppliers through arbitrary fines and deductions, the long-term development foundation built on seller partnerships will inevitably be undermined.

Only by establishing fair and reasonable bilateral cooperation mechanisms and reserving reasonable profit margins for logistics service providers can the industry eliminate similar malicious incidents and achieve stable, sustainable development.