Retail Asia 2018 JunJuly2018 | Page 29

LOGISTICS From online to on the road Digital transformation has left a positive impact on e-commerce today and it is also increasingly playing a bigger role in delivering the purchases. Muneerah Bee checks in with Joseph Ng, CEO of Skyfy Technology, to get more insights into what retailers should be aware of when it comes to logistics for e-commerce. L ogistics is often considered the biggest bottleneck to e-commerce growth in South- east Asia and no retailer would want to lose a customer because of a shipping delay that was out of the company’s control. Logistical complexity is one of the challenges of e-commerce logistics that Joseph Ng, CEO of logistics enabler Skyfy Technology, has identified as increased service requirements have led to more offered delivery options and models. “Whereas one delivery option used to be the norm, usually delivered from one fulfilment location (typically a dedicated e-commerce distribution centre), nowadays we see at least three delivery options (standard delivery, express delivery and pick- up), with multiple fulfilment locations (e-commerce distribution centres, directly from suppliers and from stores),” he observed. To overcome this, Ng suggested focusing on competencies, and a good strategy requires a study of the needs of customers, an in-depth marketing research and the ability to generate fresh ideas. He said: “Finding the right competencies for your company can take a lot of time and effort. Then putting all the pieces together to form a successful e-commerce team is often difficult. But if you develop an effective strategy combined with the right IT, HR, marketing and logistic competencies, your chances of success in e-commerce increase significantly.” In some cases, there is no real-time coordination between the warehouse and customer service when technology is not implemented to manage the entire fulfilment process. Ineffective technology application and the reliance on administrative work makes collaboration between multiple parties challenging and ultimately has a negative impact on service delivery to the customer, Ng opined. “For example, the visibility of deliveries from the warehouse to the customer can be better managed with a fleet management system that keeps track of the field workforce delivering the goods. Customer service can easily track the location of the goods and update customers on the expected time of arrival of the delivery without the need to make a call to the driver, who could be unable to pick up the phone as he is driving,” he said. Delivering results third-party performance management, it’s therefore instrumental to have enabling technology in place and the right set of key performance indicators (KPIs) and SLAs with the logistics partners.” Optimising last-mile deliveries starts with a fit-for-purpose fulfilment network or technology solution, he added. This solution should be based on relevant service requirements that have an impact on the online conversion. “As such, it is essential that the design of the solution will be an integrated effort of both category management and supply chain management to balance the needs and the possibilities.” Leveraging technology also helps to streamline the fulfilment process. For example, when an order is placed, the solution can automatically notify the person or company responsible for shipping the item(s). Users are able to create multiple fulfilment reports — one for each fulfilment provider and the group of products they are responsible for shipping. The fulfilment report displays the customer’s contact information, shipping information, and the quantity and name of product(s) ordered. ra When it comes to choosing an e-commerce fulfilment and logistics service in Asia, technology and integration service level agreements (SLAs), logistics network of third-party logistics companies (3PLs), automation of order fulfilment and fulfilment reports are some of the important factors to consider, Ng advised. For example, when choosing a third- party logistics company, it is important to consider its geographical presence. “Companies with operations in multiple countries within a region may want to work with a provider that is similarly located. Third-party logistics companies and carriers alike are investing more and more in expanding their own logistics network, technology and services. Logistical complexity is one of the challenges As a result, they too have of e-commerce logistics that Joseph Ng, CEO of surfaced as key players logistics enabler Skyfy Technology, has identified in perfecting the last as increased service requirements have led to mile,” he commented. more offered delivery options and models. It is also important for companies to re-think their operating model for logistics and take on more of an orchestrator role for their fulfilment function, • Joseph Ng predicts the future of e-commerce according to Ng: logistics in Asia. See next page. “For effective Retail Asia June/July 2018 27