Digital transformation takes over logistics of the future

An increasing number of enterprises are utilising Industry 4.0 activities on their logistics platforms, Le Toan

Vietnam Post Corporation is continuing to develop its Vmap platform. Initially put into operation in 2019, Vmap is a real-time address database for positioning, address data, and assigning codes to households.

This postal address code platform is capable of digitising and locating the exact location of customers’ addresses to provide information for businesses in industries, fields, and services that need to find customers.

Today, Vmap has data of more than 23.4 million addresses across the country. Besides basic features such as searching addresses and directions, Vmap displays a separate map layer of every house in the nation, even in mountainous and remote areas.

Vmap is now being further developed to apply in business management and operation, especially composing information on businesses into its system, so that companies can find out the best solutions for their logistics activities.

This solution contributes to optimising the transportation and delivery of goods from sender to receiver of postal, transportation, logistics, and e-commerce businesses, improving production efficiency, reducing costs, and enhancing competitiveness.

Elsewhere, in order to master the operation and service activities faster and more effectively, Pham Anh Tuan, international air freight sales director at U&I Logistics JSC, said that the company has applied digital transformation to build business management systems according to the specific needs of customers such as warehouse management, transportation management, centralised operation management, human resource management, and customer relationship management.

“It is necessary for Vietnam to build a common data system for Vietnam’s seaport system, connecting with ports in the region and beyond, contributing to increasing exploitation efficiency and increasing Vietnam’s competitiveness with neighbouring port clusters such as Singapore, Thailand, and others,” Tuan said.

This would help optimise shipping routes and inventory management time, reduce distribution and warehousing costs, increase supply chain visibility, cut administrative costs and billing errors, and accurately track freight forwarding operations on one platform, Tuan added.

According to the Vietnam International Integration Support Centre under the Ho Chi Minh City Institute for Development Studies, the digital transformation process at Denmark’s Maersk, one of the largest navigators in the world, is accelerated based on the application of many modern technologies to optimise operations such as Maana’s knowledge graph model, which provides information about the journeys of the ocean management team, and the cloud solutions of BlueYonder in warehouse management to develop smart containers and connect smart seaports.

Maersk also provides digital application services for customers, such as a personalised website for freight forwarding management, locating shipments via GPS, a mobile phone application that updates 24/7 real-time cargo routes, an electronic data interchange system to share data, and more besides.

According to the Vietnam Logistics Business Association (VLA), currently, Vietnam’s logistics market has the participation of about 3,000 domestic enterprises and more than 30 companies providing transnational logistics services, with big names such as DHL, FedEx, Maersk, APL Logistics, CJ logistics, KMTC Logistics, and many others.

However, recent years have seen damage caused to global supply chains, posing a requirement to accelerate the digital transformation process in logistics to both overcome new problems and take advantage of the current advantages of Industry 4.0.

Vice chairman of the VLA, Le Quang Trung, said that through digital transformation, logistics service providers will change the mindset of stagnation, create a breakthrough to improve competitiveness, reduce logistics costs, grow, gain more customers and achieve maximum profits that are superior to before digital transformation.

“The domestic logistics industry has made certain strides in the digital transformation process when 50-60 per cent of businesses in most services are applying various types of technology, depending on the size and nature of each service to utilise in the digital economy,” he said.

According to a 2022 survey from Vietnam Report, logistics enterprises have increased investment in digital transformation. Some 86 per cent of more than 3,300 enterprises expect the application of digital tech to bring significant benefits in terms of productivity and business performance in the future.

In addition to technology platforms that are commonly used in the activities of logistics enterprises, emerging platforms have been applied. About 68 per cent of logistics enterprises have deployed Industry 4.0 staples into business activities such as the Internet of Things (19.4 per cent), cloud computing (18.4 per cent), AI (18.4 per cent), and big data and blockchain (14.3 per cent).

According to the VLA, the growth rate of the logistics industry in Vietnam in recent years has reached about 14-16 per cent annually, with a scale of about $40-42 billion per year.

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