E-commerce delivery speeds in ASEAN rebound thanks to tech centric solutions
By Digital News Asia October 7, 2020
- Delivery time in Malaysia increased from an average of 2.1 days to 4.6 days
- Use of parcel lockers; more transparent tracking, helps customer experience
At the height of the Covid-19 pandemic in ASEAN, e-commerce businesses found themselves becoming essentials services. But where online shopping began to thrive, logistics operations found themselves facing a massive dilemma. How do you ensure that increased orders arrive at their respective destinations safely and on time in the midst of an unprecedented pandemic?
Data on delivery speed collected by global e-commerce logistics community Parcel Monitor, in conjunction with online shopping aggregator iPrice Group, shows just how difficult it is.The data was derived by analysing over 1.4 million parcel shipments in Singapore, Malaysia, Thailand, and Indonesia between January 2020 and June 2020
The worst impact on e-commerce deliveries, the study found, was felt in Malaysia, where delivery time rapidly increased from 2.1 days (pre-lockdown), peaking at 4.6 days (during lockdown).
Similarly, in Indonesia, parcels took 3 days to reach destinations during lockdown, significantly slower than the pre-lockdown average of 2.3 days.
The situations were better in Thailand and Singapore, but even here, the average delivery time still increased by 0.2 days during the months when lockdowns were in force.
Feedback from Ninja Van, a courier company with e-commerce partners like Lazada, Shopee, and Zalora, among others, paints the same picture. Their business across the region was affected by varying degrees during the early days of the pandemic.
There were some major factors at play. For one, e-commerce experienced a jump. According to iPrice Group, traffic grew by up to 60% in April and May, leading to an increase in parcel volumes in most ASEAN markets.
While this was happening, shippers were operating on shorter hours. The measures taken to ensure the safety and well-being of their staff. At the same time, according to Ninja Van’s representative, the jump in e-commerce also saw more bulky parcels being shipped, which affected productivity.
In addition, limited flights and sailings across the region resulted in delays and increased cost for logistics, notes Timothy M. Kairuz, Business Development Manager at Filipino logistics provider Transglobe Logistics International Inc.
Parcel Monitor also expressed concerns that these strains on delivery speed were affecting customer experience. Already it has noted surges in customer complaints, missing parcels, and customer service calls, leading to a poor experience for all parties involved in the delivery process.
Calling for smart solutions
Parcel Monitor observes that a potential solution to the challenges mentioned is the rising usage of parcel locker networks across Southeast Asia. These are locker services that allow for deliverers to drop off items at certain lockers that customers can go and retrieve, or vice versa. It makes for faster and more flexible delivery services while minimising direct contact between personnel and customers.
For instance, the Singaporean government announced the development of 1,000 parcel locker stations nationwide scheduled for completion by the end of 2021. Meanwhile, parcel locker stations are also in 86 LRT stations in Malaysia, courtesy of Ninja Van and Prasarana Malaysia Bhd’s partnership in 2019, whereas PopBox and Box24 brought the same concept to Indonesia and Thailand respectively.
“This will be a delivery trend that will continue to grow in ASEAN as e-commerce logistics in the region continues to mature,” concludes Parcel Monitor & Parcel Platform founder and CEO Arne Jeroschewski.
Jeroschewski further suggests that visibility and transparency on the delivery journey will become a key solution to improve customer experience for both recipients and merchants. “Customers want to know where the parcels are, what’s happening to them, and when to expect their orders at their doorstep.”
In that regard, iPrice and Parcel Monitor note that Ninja Van seems to be on the right track as they are already offering live tracking and a live chat feature that allow parcel recipients to better communicate with shippers while having full visibility of their parcels.
“We believe that being able to better connect and communicate with our shippers and parcel recipients allows the consumers to have high visibility of their parcels while staying updated about any new services or products,” says Ninja Van cofounder and CEO Lai Chang Wen (pic, right).
FedEx’s tracking device, SenseAware, on the other hand, gives merchants and senders round-the-clock updates on a delivery package, including information on temperature and humidity, which is highly important for essential products such as medicine and fresh groceries.
Own tech solutions
Parcel Monitor and iPrice Group found that, in response to the sharp uptick in demand for manpower, each company is applying their own technological solutions with the same goal of quickly ramping up capacity.
Vietnamese express courier, Giaohangnhanh, recently unveiled an automatic sorting warehouse, which is the first of its kind in the country that they claim can help reduce manpower demand by up to 75%.
Meanwhile, Ninja Van puts its focus on automating intuition, which allows staff to be less dependent on lengthy training procedures and to quickly familiarise themselves with operating processes.
Results of these various solutions can already be seen in most countries by June. Parcel Monitor’s latest data shows that most of these countries' average delivery speeds are already returning to pre-Covid-19 levels.
Malaysia’s e-commerce parcels now take an average of 3.1 days to reach buyers, which is an enormous improvement. However, it is still slower compared to delivery speeds seen at the beginning of the year. Singapore’s delivery activities are back to the same level seen befor while Indonesia also seems to be following the same trend.
The overall quick responses and improvements seen across the region show great potential for e-commerce and parcel delivery services in ASEAN.
“The pandemic has shown that the demand for e-commerce is on the rise and here to stay for the long haul,” Jeroschewski of Parcel Monitor notes. “There will be many upcoming opportunities for new players in the e-commerce logistics space to take advantage of this growth in e-commerce, and they may offer an even better experience to customers.”
Related Stories :