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[8.04] Morning Round-Up: Kerry Logistics Invests $30 Million in Thailand

Here’s what you should know today:

1. Kerry Logistics invests $30 million in Thailand 

Logistic provider Kerry Express plans to spend at least 1 billion baht or $30 million in Thailand to expand its networks and meet growing demand of ecommerce delivery.

It plans to open 100 new distribution centres nationwide, bringing the total to 500 next year, as well as on new facilities, including 1,000 more trucks and motorcycles.

Last month, Kerry Express set up a new logistics hub with sorting capacity of 200,000 parcels a day and expand its Bang Na hub is to reach sorting capacity of 500,000 parcels per day.

Read the full story here.

2. Uber is under scrutiny in Singapore for safety issue 

Uber is under scrutiny for its auto-lending program after the company leased cars prone to fires in Singapore.

The ride-hailing company borrowed capital from Goldman Sachs and other banks used to purchase more than 1,000 defective Honda vehicles from importers. Uber managers in Singapore were aware of the problem when it bought and leased them to drivers.

Uber said it took “swift action to fix the problem” after learning of the auto fire and worked with Singapore officials on its response.

Read the full story here.

3. TV still the main advertising media in Indonesia 

Television will still remain the main advertising media in Indonesia until 2021 according to latest report from PricewaterhouseCoopers (PwC).

TV maintain 53.8% market share, up from 53.6% in 2016. Indonesian media and entertainment would see a 10.3% Compound Annual Growth Rate (CAGR) in the period between 2016 and 2021.

However, during the same period, PwC estimated that the CAGR of Internet advertising would reach 21.8%, higher than TV that was predicted to have a 10.4% CAGR.

Read the full story here. 

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A Personal Social Touch is Driving The Ecommerce Boom in Thailand

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personal touch in Ecommerce Thailand

Source: Dario Pignatelli — Bloomberg/Getty Images

A global survey by PriceWaterhouseCoopers revealed that more than 51% of Thai online shoppers made their purchase via social media. In second place is India with 32%, followed by Malaysia and China at 31% and 27% respectively. This trend is driven by the key consumer trend, which is based on trust.

The importance of personal touch in Thailand ecommerce 

The “personal touch” that shopping via social media offers has been highlighted as a reason behind this environment of trust, which the larger ecommerce companies selling products via websites are unable to muster. LINE or Instagram accounts allow people to communicate directly with sellers, unlike the impersonal experience with web administrators of an ecommerce website, says Pavida Pananond, associate professor of international business at Bangkok’s Thammasat University.

Thailand’s B2C Stats

  • Products $14- $42  per order, accounted for  approximately $13.4 million of Thailand’s $59.7 billion of ecommerce sales in 2015
  • B2C sales in 2014 came to $11.6 million, out of $57.4 billion in total ecommerce sales

However, social commerce has also had its share of bad eggs. The mainstream media and online chats are occasionally peppered with reports of unscrupulous sellers trying to rip off unsuspecting buyers in this predominantly cash-based market, where cash still accounts for 90% of payments nationwide.

However, such setbacks barely dented the direction the online market is taking. The subsequent spread of ecommerce is reflected in the online trade countrywide, with once-dominant Bangkok now accounting for just 30% of the market, with the majority of ecommerce transactions now taking place in the provinces.

“In the provinces, it is not about the online experience but an easier way to get stuff you want,” says Santit Jirawongkraisorn, co-founder of Lalamove, a Bangkok-based logistics company.

A version of this appeared in Nikkei Asian Review on June 26. Read the full article here.

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