City-state’s service providers latching onto logistics

August 10, 2021 | 10:00
Vietnam’s logistics industry is playing an important role in ASEAN, attracting Singaporean service providers to secure a stronger footprint in the country.
1556 City-state’s service providers latching onto logistics
City-state’s service providers latching onto logistics - Illustration photo

YCH Group of Singapore and T&T Group of Vietnam have formalised a joint venture called T&Y SuperPort to kick off a new infrastructure project.

The superport will consist of an international inland dry port, an integrated customs service zone, a multi-modal logistics hub with a smart growth centre, bonded and non-bonded warehouses, inland container depots (ICD) and container freight stations, to mention a few.

Jeffrey Tan, head of Group Corporate Development and Technologies at YCH Group, told VIR, “The phase 1 development is already underway with the ICD, bonded zone, and an off-airport cargo terminal that consists of a separated warehouse with full functions – like security screening, customs declaration and clearance, and loading and unloading with a secured green lane to the Noi Bai International Airport – all similar processes and procedures that aim to minimise waiting time at the airport itself.”

As part of its distribution paradigm strategy, YCH is also looking at another modern development, the DistriPark – a smart growth centre and a supply chain city in the south of Vietnam, and another in the central city of Danang.

Concurrently, YCH is progressing with another initiative with the development of Phnom Penh Logistics Complex in Cambodia. These two smart logistics infrastructure projects are part of the ASEAN Smart Logistics Network, which was launched in 2020. The group is looking to launch more projects like the superport venture in every ASEAN member state.

“Trade volume in ASEAN is expected to increase in the next few years, accelerated by the burgeoning digital economies and manufacturing activities. This bodes well for logistics players like us as we are in proximity to capitalise on this trend,” Tan said. “Vietnam’s logistics industry is one of the fastest growing industries, and it is estimated to grow faster than the GDP growth rate. However, the caveat is that there must be connectivity, not only in Vietnam, but also in the remaining ASEAN economies.”

This is where the objectives of the superport project come into the picture, with T&Y SuperPort being the first of its kind – multi-modal logistics hubs with integrated dry ports and advance supply chain nerve centres focusing on connectivity, sustainability, scalability, and agility.

The port will show the advantages of multi-modal transportation through road, rail, air, and sea, and is able to act as a supply hub for manufacturing operations which have grown exponentially in ASEAN countries in recent years.

“We are looking to further strengthening the trade connectivity between the Mekong countries of Cambodia, Laos, Myanmar, Vietnam, Thailand, and Southwestern China,” Tan noted.

Another Singaporean logistics firm, Ninja Van, also entered the Vietnamese market on a trial basis in 2016 after successfully operating in Singapore and Malaysia. Ninja Van formally commenced operations in 2018.

Starting with only 50 riders, the company at that time delivered over 15,000 items per month. Ninja Van Vietnam now has a wide network across the country, with over 6,000 riders in charge of delivering more than 300,000 parcels per day, making the company one of the most reliable delivery partners of e-commerce companies such as Shopee, Lazada, Sendo, and Tiki.

Since 2020, several waves of COVID-19 infections have hit the country, wreaking havoc on the e-logistics and delivery industries. However, from a positive standpoint, this has been an opportunity for e-commerce to grow, according to Dzung Phan, CEO of Ninja Van Vietnam.

Phan cited data from the Ho Chi Minh City Department of Industry and Trade showing that at the end of April, 62.5 per cent of local consumers utilised the internet for shopping, with 17.9 per cent opting for online payments.

“As a result, the logistics business has a lot of room to grow, and we hope that the government will help it flourish by enacting reasonable regulations to cope with this situation,” Phan said.

Ninja Van has received an additional $279 million in a series D funding in 2020. This capital has been used to expand the company’s business-to-business offerings, while also expanding its other services in different markets.

In Vietnam, Ninja Van is concentrating on increasing brand awareness through marketing initiatives and improved customer service practices.

In May this year, Singapore’s Emergent Vietnam Logistics Development Pte., Ltd. received a licence to develop the $34.4-million Logistics ECPVN Binh Duong 2 Centre. Located in the Tan Dong Hiep B Industrial Park, the centre will offer logistics and warehousing services once completed.

By Thanh Van

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