The ‘Pao Tui’ Revolution: Redefining Convenience in the Post-Pandemic Era

 

Imagine China / AP Images

The COVID-19 pandemic has dramatically altered global business landscapes, prompting industries to adopt innovative practices to cater to changing consumer preferences. One sector that has capitalised on this shift is the ‘Pao Tui’ industry in China. With its ability to deliver everything from food to pharmaceuticals, the Pao Tui sector is redefining convenience in the post-pandemic era.

A Market Overview: Emergence and Expansion

China’s Pao Tui, the delivery industry, has recorded tremendous growth over the last five years. From 2017 to 2022, the industry saw a surge in order volume, from 8.31 billion to 40.00 billion. This 381.34% increase translates to an average year-over-year growth rate of 48.90%, a testament to the industry’s resilience amidst the global pandemic.

In tandem with the surge in order volume, the industry’s revenue figures experienced a significant boost. From a revenue of CNY 70.40 billion (US$9.96 billion) in 2017, the Pao Tui industry escalated its earnings to CNY 200.00 billion (US$28.28 billion) in 2022. This 184.09% jump equates to a compounded annual growth rate (CAGR) of 23.22%, further illuminating the industry’s economic potency.

The rising user numbers also show the escalating demand for delivery services. From a relatively modest 290 million users in 2017, the industry boasted 750.00 million users in 2022, marking a 158.62% increase. The expansion of the user base indicates a shift in consumer behaviour towards a preference for delivery services.

Understanding the ＂Pao Tui＂ User: Occupation, Gender, and Geography

A closer look at user occupation proportions offers exciting insights. Corporate white-collar workers comprise a considerable chunk of the user base, constituting 43.60% of the total users. This segment is followed by service industry personnel (13.90%), students (11.50%), freelancers (10.30%), and doctors (7.00%). These figures suggest that busy professionals and students rely heavily on delivery services, reflecting a trend towards convenience and time-saving solutions.

Regarding gender distribution, male users outpace female users in the Pao Tui industry. In 2022, the male user base was 454.50 million compared to 295.50 million female users. This pattern may hint at differing gender-based consumption habits, with more men opting for the convenience of delivery services.

Geographically, the Pao Tui industry has the most substantial presence in new first-tier cities, accounting for 27.50% of total users. First-tier cities comprise 12.60% of users, while only 36.60% come from third to fifth-tier cities. This data indicates the spread and penetration of the Pao Tui industry across different urban tiers in China.

Generation Z and “Pao Tui” Service: Embracing the New Wave

The acceptance and demand for “Pao Tui” services are experiencing a significant shift with the rise of Generation Z (people aged 18–25). Notably, the TGI index, a measure of product popularity among different age demographics, indicates a strong preference for “Pao Tui” services among this age group.

As per the TGI index, Generation Z scores 150.00 for the “Pao Tui” service, surpassing other age groups, which is a testament to their adoption and acceptance of these instant delivery services. This high score reflects their openness to novel consumer experiences and digital solutions.

While the older generations are also increasingly embracing these services — demonstrated by their growing use for grocery shopping — Generation Z is leading the way, signalling a bright future for the “Pao Tui” industry.

Competing in the Pao Tui Landscape: Key Players and Business Models

The Pao Tui industry features major players like Meituan, Ele. Me, DADA, and Shunfeng, each contributing to the industry’s flourishing landscape with its unique business models and service offerings.

Data from 《中国物流与采购》，东吴证券研究所

Meituan, with its substantial delivery volume of ten billion orders and approximately four million couriers, dominates the industry. Despite suffering a net loss of CNY61.75 billion (US$8.69 billion) in 2022, the company kept its delivery costs relatively low at 36.4% of its revenue, CNY80.19 billion (US$11.29 billion). Its primary service offering revolves around food delivery, with some personal errand orders.

On the other hand, DADA and Shunfeng maintain a worse financial position. DADA registered a minor net loss of CNY2.20 billion (US$31.00 million), keeping its delivery costs at 111.60% of its revenue of CNY10.49 billion (US$1.48 billion). The company excels in running errands and providing last-mile delivery for JD. Shunfeng recorded a profit of CNY430 million (US$60.52 million), keeping its delivery cost at 94.81% of its revenue of CNY9.74 billion (US$1.37 billion)— the company’s service centres around Key Account (KA) clients and JD’s self-operated delivery.

A key element contributing to these companies’ success is their strategic partnerships. For example, Meituan partners with restaurants, supermarkets, and retailers to provide various products, from food to retail. Similarly, Ele. Me, powered by Alibaba, collaborates with online platforms like Tmall’s Mini Shop and offline chain brands to deliver multiple goods.

The Pao Tui Industry: Future Prospects

The Pao Tui industry, backed by robust growth metrics, shows immense potential for expansion. The following factors are anticipated to shape the industry’s trajectory:

Section 1: User Demands and Habits

As modern life accelerates, consumers increasingly prioritise convenience, speed, and variety when choosing services. A prime example of this trend in the instant logistics industry is the widespread use of “Pao Tui” services. Particularly popular among the younger, well-educated demographic, these services are perceived as a convenient solution to their busy lifestyle or a respite for the “lazy” moments. This trend underscores the potential for further industry growth, catering to modern consumers’ evolving needs.

“For me, the ‘hourly delivery’ of instant retail is more time-saving and effortless, and now it’s not just catering; everything can be delivered. For example, if I wanted to buy something, I used to have to drive, ride, or run, and it would take an hour or two back and forth. Now it’s delivered in less than half an hour, greatly facilitating my life.” Chen, born after 1995, can’t stop praising instant retail.

Section 2: The Elderly Population and Its Significance

China’s rapidly ageing population offers an unprecedented opportunity for the instant logistics industry. As per the 2023 data, the population aged 60 and above has reached 264.02 million. Studies suggest that about 50% of this ageing demographic, approximately 132.00 million, suffer from various chronic diseases. This revelation illustrates the urgent need for tailored services, such as pharmaceutical deliveries that can cater to the unique needs of the elderly population.

For instance, Kangmei Medical has introduced a service that delivers drugs within 4 hours after a consultation. Offering medication dispensing, traditional Chinese medicine decoction, and drug delivery services, Kangmei Medical can handle up to 17,000.00 prescriptions daily. This demonstrates the vast potential in the market for instant pharmaceutical delivery.

Interestingly, this age group’s acceptance of online shopping has steadily increased. However, Target Group Index (TGI) data reveals that the usage remains relatively low for those over 50. Nevertheless, this demographic presents a pivotal market opportunity with their stable income and substantial purchasing power.

In 2021, according to the population census report, individuals aged 60 and above accounted for 18.70% of the total population, reaching a count of approximately 264.02 million (with those aged 65 and above making up 13.50% of the total population). Compared to the previous year, the proportion of individuals aged between 15–59 increased by 1.35%, while the percentage of those 60 and older rose by 5.44%. In 2022, the population aged 60 and above increased by 12.68 million, raising the proportion by 0.90%. It is predicted that by 2030, the population aged 60 and above will reach 481.95 million.

In light of these demographic trends, there is an emergent need to develop instant logistics services dedicated to older people. This tailored approach will not only meet the distinct needs of this demographic but also unlock a massive, untapped market potential.

Section 3: Potential Growth in Lower-Tier Cities

While first and second-tier cities in China currently account for the highest penetration rates of instant logistics, as reflected in the rates of 1.51 and 0.84, respectively, as of August 2020, significant growth potential exists in the lower-tier cities. This untapped potential can be observed in the steady, slower growth rates in fourth-tier cities (0.19 in August 2020) and fifth-tier and below cities (0.13 in August 2020). Understanding these lower-tier cities’ demographic and regional specifics is critical to exploit this growth potential. Tailoring service offerings to align with the unique needs and preferences of the inhabitants of these cities can maximise market penetration and drive the expansion of instant logistics.

Section 4: Policy Guidance and Support

Policies and regulatory guidance play a crucial role in shaping the industry landscape. A detailed examination of existing and upcoming policies can shed light on the direction of the industry and potential opportunities and challenges. Leveraging this understanding, companies can strategies their growth plans in alignment with the regulatory environment.

Source from China Thinktanks, Chongqing Government

Section 5: Technological Advancements

Source from iresearch, Tech China

In an era of rapid technological advancements, companies like Meituan, DADA, and Shunfeng invest heavily in technology to enhance their operations. For instance, Meituan has invested in autonomous delivery vehicles and drone technology to improve logistics efficiency. The company also launched a 24-hour smart pharmacy, leveraging robotics to sort and distribute medications. Shunfeng, on the other hand, has developed a cloud-based system to better manage and deliver orders across multiple platforms. By understanding the tech investments of these industry leaders, insights can be gleaned about the direction of technological innovation in the “Pao Tui” industry.

Conclusion

In conclusion, the Pao Tui industry stands at an exciting crossroads. As companies navigate user demands, demographic changes, potential market growth areas, supportive policies, and technological advancements, the industry is poised to redefine convenience in the digital age. The future appears bright for this industry, driven by its unique ability to cater to the evolving needs of the modern consumer in the post-pandemic world.

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The Trend of Chinese People Seeking Plastic Surgery in South Korea: Challenges in Regulations and Supervision

Source from Reuters/ Nir ​​Elias

I. Introduction

Recently, advisories issued by the Chinese Embassy in South Korea cautioned Chinese tourists about the potential risks associated with undergoing plastic surgery in the country. A remarkable trend in recent years has seen an increasing number of Chinese people travelling to South Korea to undergo plastic surgery. South Korea, touted as the “world capital of plastic surgery, “attracts many Chinese medical tourists. Examining the challenges in regulations and supervision of this trend is crucial for ensuring patient safety and maintaining the integrity of the medical tourism industry.

II. Overview of the Trend

South Korea’s popularity as a destination for plastic surgery among Chinese individuals is fuelled by cultural preferences, cost-effectiveness, and the perceived superior quality of South Korean surgical services. The data shows that the proportion of Chinese patients in the total number of medical tourists visiting South Korea rose from 7.84% in 2009 to 32.73% in 2019, demonstrating a consistent increase in the trend.

Data from Statista

In 2022, South Korea experienced a significant increase of 70.10 % in foreign individuals receiving medical treatment compared to 2021, with 248,000 non-resident foreigners seeking medical services. Chinese patients comprised 17.70 % of these medical tourists, coming second after Americans, making up 17.80 %. Despite travel restrictions, there was a 56.80 % increase in Chinese nationals visiting South Korea compared to the previous year.

III. Frequent Plastic Surgery Failures in South Korea, Some Resulting in Death

“Ghost surgeries” refer to a deceptive practice in which the plastic surgeon a patient has chosen and consented to undergo a procedure with is replaced by a less experienced surgeon or even a non-medical professional without the patient’s knowledge or consent. This practice is particularly problematic for Chinese patients seeking plastic surgery in South Korea due to language barriers, lack of familiarity with the local healthcare system, and the often-anonymous nature of medical tourism. These factors make it difficult for patients to confirm their surgeon’s credentials or assert their rights to informed consent. Consequently, Chinese patients may unknowingly fall victim to “ghost surgeries,” leading to a higher risk of complications, unsatisfactory outcomes, or severe health consequences. This highlights the need for more stringent regulations, supervision, and patient education in the international plastic surgery industry.

Some Facts about Ghost Surgery

Case of Ryu Sang-wook: Between November 2012 and October 2013, it was found that 33 patients scheduled for operations by plastic surgeon Ryu Sang-wook had their surgeries performed by other doctors, including dentists and otolaryngologists, while they were unconscious under anaesthesia. These surgeries were conducted without the patient’s consent. Ryu allegedly saved 150.00 million won (US$126,000.00) by doing this.

Estimated Victims: According to the Korean Society of Plastic Surgeons, 100,000 patients fell victim to ghost surgeries between 2008 and 2014.

Surgeon-to-Population Ratio: As of 2020, South Korea had a surgeon-to-population ratio of 5 plastic surgeons per 100,000 population. This starkly contrasts China’s balance of 0.20 plastic surgeons per 100,000 population. This disproportionate ratio in South Korea could contribute to an environment where unethical practices like ghost surgeries might occur, as there is more competition among surgeons for patients.

These figures underscore the urgent need for regulatory reforms and more vigorous enforcement in the South Korean plastic surgery industry. Patient safety and the principles of informed consent must always take precedence in medical practices.

Failure Cases in South Korean Plastic Surgery

Grand Plastic Surgery Scandal (Seoul, 2023): Ryu Sang-wook’s renowned clinic faced legal action over the controversial practice of “ghost surgeries” involving non-specialist surgeons performing procedures. Furthermore, an unfortunate patient death has led to an inquiry into potential anaesthesia mismanagement at the clinic. Despite the allegations, Ryu maintains his innocence.

Unauthorised Clinic Tragedy (Seoul, 2015): A patient lapsed into a coma following a routine operation at a non-registered clinic. Anaesthetic complications are suspected to be the cause. Although she regained consciousness, her mental state post-surgery remains uncertain.

Gangnam Clinic Fatality (Seoul, 2023): A woman in her 20s from China tragically lost her life following a ventricular standstill during her plastic surgery at a Gangnam clinic. An ongoing investigation aims to ascertain the exact cause of death and potential instances of medical malpractice.

Screenshot from Channel A News

Seocho Facial Surgery Case (Seoul, 2014): A 21-year-old university student tragically passed away after a 4-hour facial bone contouring procedure in Seocho. She never recovered consciousness post-operation. The hospital staff are now under investigation to determine any potential culpability.

Rhinoplasty Incident (Seoul, 2014): A 34-year-old woman tragically died during a rhinoplasty procedure. Specific details surrounding the incident remain undisclosed.

Liposuction Tragedy (Seoul, 2015): A 50-year-old woman suffered fatal respiratory complications during an abdominal liposuction surgery. Further details concerning this incident have not been provided.

Ghost Doctor Case (South Korea, 2020): A 34-year-old lady called “Law” died during a plastic surgery procedure performed by an unlicensed practitioner, referred to as a “ghost doctor.” It’s alleged that no anaesthetists were present during the operation, violating surgical protocols.

Reasons and Risks Associated with Ghost Doctor Phenomenon

The phenomenon of “ghost doctors” in South Korea’s plastic surgery industry presents substantial patient risks. There are several key reasons why such practices have emerged:

Surplus of Surgeons and Economic Incentives: South Korea has an abundance of plastic surgeons, far exceeding the domestic demand. Consequently, the government has encouraged cosmetic surgery procedures to stimulate economic growth. The plastic surgery industry contributes significantly to South Korea’s GDP, which reached a value of about 1.95 billion during 2018–2022. It is expected to grow at a CAGR of approximately 13.20% in the forecast period of 2023–2028.

Profit Motivation of Clinics: Many plastic surgery clinics are driven by the pursuit of higher profits. Employing interns or unlicensed doctors can increase profit margins, despite the associated ethical and medical risks.

Loose Regulatory Oversight: Before 2019, South Korea had relatively lax laws and regulations governing the plastic surgery industry. This lack of stringent oversight contributed to the emergence and persistence of unethical practices like “ghost surgeries.”

Lack of Awareness Among Foreign Consumers: Many foreign consumers depend on intermediary agencies for their arrangements due to geographical distance and lack of specialised knowledge. Their ability to accurately identify reliable and reputable medical institutions is often limited, making them more vulnerable to unscrupulous practices.

IV. Regulatory Framework in South Korea

The regulatory framework governing plastic surgery in South Korea is complex. Licensing requirements include rigorous education, professional training, and certification examinations. Several regulatory bodies supervise these practices, from issuing licenses to setting professional standards and ethics.

Measures To Regulate the Cosmetic & Plastic Surgery Market Targeting Medical Tourists

· Healthcare Law

· International Medical Business Support Law

· Medical Service Act

· Act on Mediation of Medical Disputes

· Action on Remedies for Injuries from Medical Malpractice

On 31 Aug 2021, the National Assembly finally passed a bill to revise the medical law requiring CCTVs to be installed inside surgery rooms. It appears that the closed-circuit television (CCTV) in the operating room (OR) should be started when:

The patient or the patient’s guardian requests it. In this case, the head of the medical institution or the medical professional must record the surgery scene when the patient is unconscious due to general anaesthesia or similar conditions.

The head of the medical institution or the medical professional cannot refuse to record the surgery unless there are legitimate reasons defined by the Ministry of Health and Welfare, such as emergency surgery, high-risk surgery, or situations that significantly hinder the achievement of the purpose of training hospitals.

Navigating Through Plastic Surgery: Officially Recognised Institutions with High Standards

In the vast field of cosmetic and reconstructive surgery, knowing that the institution to select adheres to the highest standards of care and professionalism is crucial. South Korean government offered a list of appropriate certifications, skilled and licensed medical professionals, and patient safety and satisfaction records.

Source from Medical Tourism Information

V. Impact on Chinese Patients

In recent years, South Korea has enacted numerous legal measures to limit and regulate the phenomenon of “ghost doctors” (unqualified personnel performing surgeries). However, for Chinese patients seeking to understand these measures, this information cannot be easily accessed from a government website or other readily available sources. Instead, a deep dive into the laws and regulations is necessary to protect their rights.

The revised law in South Korea stipulates that “The patient or the patient’s guardian requests it. In this case, the head of the medical institution or the medical professional must record the surgery scene when the patient is unconscious due to general anaesthesia or similar conditions.” This law only applies when a patient or their guardian requests explicitly that the surgery be recorded. However, patients must be made aware of this provision or make such a request due to a need for knowledge about the law to ensure their rights are adequately safeguarded.

Chinese patients seeking cosmetic surgery in South Korea face several specific challenges:

· Language Barrier: Legal provisions and consent forms are published in Korean and sometimes in English. This could lead to misunderstandings or potential “language traps” due to translation issues. There are only 1.76 million Korean language users in China within a population of 1.41 billion, which means only 0.13% of people in China may understand the law and the certifications in Korean.

· Lack of Legal Knowledge: Patients might miss opportunities to protect their rights due to unfamiliarity with South Korean laws and regulations.

· Information Gathering: Finding reliable information can be challenging. Search engine results often direct users to intermediary agencies in Korea, with varying levels of quality and trustworthiness. These agencies usually charge high fees, with 50–70% of the costs being service fees, leading consumers to believe they are choosing qualified cosmetic surgery services.

Given these challenges, Chinese patients seeking medical procedures in South Korea must be provided with accurate and accessible information to protect their rights. This includes clear and comprehensive translations of legal provisions and consent forms and verified information about the qualifications of medical professionals and the specifics of proposed procedures.

Moreover, further research is needed to evaluate the effectiveness of the new South Korean law in safeguarding patients’ rights, especially for foreign patients who might need to become more familiar with the legal and medical systems in South Korea.

VII. Recommendations and Solutions

Strategic Sino-Korean collaboration is indispensable as the public’s demand for cosmetic surgery remains persistent. We propose importing technologically advanced and highly competent South Korean medical facilities into China, allowing citizens to undergo secure procedures under the aegis of Chinese law, thus fundamentally eliminating the phenomenon of “ghost doctor” incidents.

Given the challenges Chinese citizens face abroad — namely intermediaries, language barriers, and unfamiliarity with foreign legalities — the Chinese government’s structured management of domestic third-party agencies is advisable. Such measures may include auditing the compliance of South Korean medical institutions or appointing recognised institutions, significantly reducing risks associated with inadequate qualifications or illicit surgical practices.

With the escalating trend of Chinese tourism in South Korea, a bilateral legal system could lower the risks associated with medical cosmetic procedures. This could involve pre-operative assessments and post-operative recovery protocols implemented domestically through collaborations with local institutions, ensuring comprehensive patient support.

It is essential to reconsider societal perceptions of beauty and plastic surgery. It must be questioned whether physical attractiveness achieved through cosmetic procedures truly encapsulates holistic beauty. This societal misconception warrants revisiting in the face of potential post-operative complications such as facial stiffness and botulinum toxin infections.

It behoves the government to foster a balanced understanding of beauty, separate from surgical alterations, and educate citizens about cosmetic surgery’s benefits and risks. A robust public awareness campaign would debunk plastic surgery myths and emphasise its potential risks, promoting informed decision-making driven by self-acceptance rather than societal pressure.

A radical shift in the beauty narrative, promotion of natural appearances, and a thorough understanding of potential plastic surgery risks could decrease the demand for overseas cosmetic procedures. Such a strategy presents a sustainable solution to the ongoing trend of seeking foreign plastic surgery and significantly mitigates associated risks and challenges.

VIII. Conclusion

In summary, the trend of Chinese people seeking plastic surgery in South Korea presents several regulatory and supervisory challenges. While significant efforts have been made to address these issues, much remains to be done. Continued emphasis on robust regulations, adequate supervision, and improved patient protection measures is essential to ensure the safety and satisfaction of all patients involved in this trend.

Reference

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