E-logistics race spurs deliverers

Last week, DHL eCommerce launched a nationwide network of service points in Vietnam, a strategic move following its rollout of a domestic delivery network in the country earlier this year.

Charles Brewer, CEO of DHL eCommerce, said that the firm will begin using the shop-in-shop model, which means DHL eCommerce will open and operate counters in local shops, convenience stores, and cafés. The company has already launched more than 100 service points and will continue to rapidly expand to more than 1,000 by the end of 2018. This new service is expected to bring about more choices and convenience for both e-tailers and consumers.

Sellers can choose to wait for packages to be picked up, or locate the nearest DHL eCommerce location and drop their packages off to be shipped.

In addition, the service helps consumers and online shoppers, who can direct shipments to the nearest service point for delivery and pick up at their own convenience. At the same time, the network gives shop owners an additional revenue stream. When customers pick up their packages at DHL eCommerce service points, they might spend money while in the shop.

“Vietnam’s e-commerce sector is expected to grow to seven times its current size, and the number of parcels delivered per day is expected to grow by 26 per cent by 2020,” said Thomas Harris, managing director of DHL eCommerce. “Since our local debut in July, DHL eCommerce has been the number one provider for merchants in Vietnam, completing 99 per cent of deliveries on time with only 1 per cent returns. This rate is up to 15-20 per cent higher than other third-party logistics providers in the market, which means merchants will earn more revenue due to our improved service.”

Last-mile delivery startup Giao Hang Nhanh also has plans to expand its local presence. By hiring more than 2,000 delivery drivers, the firm hopes to expand its market share to 17 per cent in the next two years. According to Nguyen Tran Thi, co-founder and CEO of Giao Hang Nhanh, Vietnamese people place high value on speedy deliveries, so companies that deliver faster with better service will gain a major competitive edge. Giao Hang Nhanh is capitalising on market opportunities to improve its delivery offerings.

A new player, Yamato 365 Express, recently unveiled a new cold-parcel delivery service in Vietnam. In addition, the company has begun to accept cash-on-delivery, which is extremely popular in Vietnam’s cash-dominated economy.

In 2013, there were few companies that provided delivery services for e-commerce marketplaces. Now, many delivery startups like Giao Hang Tiet Kiem, Giao Hang Gia Re, Ninja Van, and ShipS have sprung up and are racing to gain market share.

The rising number of parcels has also pushed e-commerce companies to explore new ways of meeting consumer demand. Pine Kyaw, managing director of Shopee Vietnam, said that Shopee’s mobile-based marketplace has achieved healthy growth in Vietnam after two years of operations. In its recent promotional campaign ‘9/9’, which took place on September 9, Shopee recorded a fivefold increase in terms of traffic and a 350 per cent increase in the number of orders against the same period last year.

“Shopee is partnering with four logistics players in Vietnam – Giao Hang Tiet Kiem, Giao Hang Nhanh, and Viettel Post. Shopee wants to get the best reach of all logistics partners, so the company is in talks with Vietnam Post to improve its delivery services,” he said.

Meanwhile, e-commerce site Tiki.vn has received a $44 million investment from Chinese e-commerce company JD.com to facilitate its expansion plan. Tiki will use the cash to invest in training, optimising deliveries, and promoting its click-to-delivery service.

The new investment will help Tiki raise its profile against Alibaba’s Lazada Vietnam and Shopee Vietnam, which have launched attractive promotional programmes in collaboration with free delivery for customers.