Here’s what you should know.

1. Swedish investment company Kinnevik to sell half of its 13% stake in Rocket

Kinnevik said in a statement it planned to sell 10.9 million shares via a placing but it reserved the right to increase that amount. Rocket Internet‘s share price closed down 2.1% shortly before the announcement of the sale.

Kinnevik was one of the first investors in Rocket and is the firm’s second-biggest shareholder after the Samwer brothers who have a 37% stake. Kinnevik also has stakes in a number of Rocket‘s major start-ups.

Analysts had predicted that the investment company would eventually part ways with Rocket as Kinnevik shifts its investments into education, financial technology and healthcare.

Read the rest of the story here


2. Half a million new credit card machines to be installed in Thailand

The government is hoping more people swipe plastic cards to pay for small-ticket items, as low as even 20 baht using PromptPay, which is part of the national e-payment scheme designed to make Thailand a more cashless society.

Thailand has around 24 million credit cards issued. Krungsri Consumer is the industry’s largest credit card player in terms of card base with around 3.8 million in circulation.

Read the rest of the story here.


3. UPS tests show delivery drones still need work

UPS tested the use of drones for residential delivery for the first time earlier this week.

The logistics giant specifically launched an octocopter, or multi-rotor drone, from the top of a delivery van. The drone delivered a package directly to a home, then returned to the van which had now moved down the road to a new location.

During a second, unofficial demonstration of the HorseFly for UPS on Monday, some sort of interference caused an issue with the drone’s compass. The drone aborted its launch, tried to land on top of the UPS truck, fell to the side and was nearly crushed by the still-closing lid of the vehicle.

UPS executives have insisted that drones will not replace human drivers, but is designed to make their work more efficient.

Read the rest of the story here.

2016 was a buzz year for drone crafts. The technology gained instant coverage across different industries and media sites as more companies created drones or were rumored to have one in the works.

Various logistics industry specialists also came out to assess the role of delivery drones in the landscape of logistics and last mile and predicted that drones have the potential to disrupt and reduce costs associated with traditional supply chain.

Logistics companies and retailers such as Amazon and Walmart have invested in pilot projects, but no drone has yet been commercialized. Logistics players such as DHL and Flirtey have successfully completed a few drone deliveries but are currently still in trial period.

With so much chatter in the drone conversation, which companies in our industry have actually shown progress in drone deliveries? We take a look:

1. DHL

Having operated a drone research project since 2013, DHL reportedly made a trip around a mountainous area in Bavaria, Germany area three times faster than cars with its “parcelcopter” in May 2016.

We have achieved a level of technical and procedural maturity to eventually allow for field trials in urban areas as well,” said DHL manager Jürgen Gerdes.

The delivery giant also reported to have built an automated system that can deliver packages such as medical supplies between two remote Bavarian villages. End-customers were able to visit a DHL “skyports” location where it stores the drones during the trial period in November 2016, insert their package into an allocated box and input a code that activates the drone.

DHL is also the first to apply to be a part of the mobile controlled UAV traffic research project, which will be effective this year.


2. Amazon

drone deliveries

Amazon already has a plane, a credit card, an employee-less grocery store so naturally the giant would have a drone delivery system they coin Prime Air. The company expects the drones to transport packages safely to customers within 30 minutes.

According to recent reports, Amazon has filmed for permission to run tests on experimental wireless communications technology – possibly to bolster Prime Air. Tests will take place at Amazon’s headquarters in Seattle before moving to its customer service facility in Kennewick, Washington.

If the requested tests are indeed related to Prime Air, it highlights how serious Amazon is about implementing drone delivery on a large scale. The senior manager of Amazon’s drone delivery service is Neil Woodward, a retired astronaut, and is listed as the primary contact on documents submitted by Amazon to the Federal Communications Commission regarding base stations for the wireless comms technology.

3. UPS

UPS made headlines in October 2016 when the package delivery giant sent a drone to deliver an asthma inhaler to a children’s summer camp on an island just off Massachusetts in the US.

According to UPS, the company is focusing on using drones to fly in remote locations to deliver emergency supplies. A more widespread delivery service is years away into the future.



4. Diamler

Diamler, the manufacturer of Mercedes Benz has been taking very active strides in drone innovation this past year. From its drone-equipped delivery van concept in September 2016 to its most recent $17 million investment in London based Startship technologies, a delivery drone startup.

Diamler’s drones aim to change last mile deliveries by integrating an advanced routing solution, which will provide information on where to place a package or whether a signature is required. It will still have to maneuver between the drone regulations set by the FAA in the US though.


5. Walmart

In collaboration with the Federal Aviation Administration and NASA, Walmart was developing internally autonomous drone technology that allows a quad-copter drone to take 30 images per second from a top-mounted camera, as well as deliver parcels. This was back in June 2016.

The Walmart drone is most likely still in the development phase, but the company plans to integrate the drones into all of its distribution centers in the future.


6. Alibaba

The buzz surrounding Alibaba’s Taobao drone started to circulate last February. Taobao ran a real world test that lets 450 people in Beijing, Guangzhou and Shanghai order ginger tea and receive it within the hour. The test period only lasted for 2 days, but it was one of the first practical instances of drone delivery in urban areas.

Since then, the Taobao drone has been PR shy.


7. 7-Eleven/Flirtey

7-Eleven actually got a head start in the drone race, beating everyone by being the first to successfully complete a regular drone delivery to consumers in the US in December 2016. Approximately over 70 orders were placed in Reno, Nevada and received doorstep drone treatment.

According to Flirtey, the average delivery time was 10 minutes. Customers mainly ordered snacks and beverages, including over the counter medicine.

Slurpees and sandwiches could be widely delivered within the US via drones in the near future.


What’s next?

Which logistics company or retailer do you think should pilot drones next? Is Southeast Asia too far away from launching commercial drones or would the bustling streets of Bangkok and Jakarta be prime locations for drones in the future? Let us know in the comments.

Here’s what you need to know for today.

1. Starbucks launches mobile payment app in Indonesia

Starbucks recently launched a mobile application in Indonesia to allow customers to pay for in-store purchases at the coffee marker’s more than 260 stores across the country. The new Starbucks Indonesia Mobile App for iPhone and Android allows customers to quickly pay for in-store purchases by scanning the barcode linked to a registered Starbucks Card.

Read the rest of the story here


2. Mobile payment gaining in popularity among consumers in Thailand

Around half the smartphone owners in Thailand are already using some form of mobile payment via their devices, according to a survey. The survey involving 2,000 respondents by mobile marketing research.

Read the rest of the story here.


3. UPS launches chatbot

The UPS chatbot, available through Facebook Messenger, Skype and Amazon platforms, provides users with a convenient and conversational interface that is different from those offered on the UPS website or UPS mobile apps.

Read the rest of the story here


Your ecommerce headlines of the day.


1. Amazon invests $17m to win India’s biggest shopping season

Amazon has freshly invested around US$17 million in its Indian marketplace ahead of the festive season, regulatory filings showed. Read the rest of the story here


2. UPS running tests using drones for commercial deliveries

 UPS and drone maker CyPhy Works have begun testing the use of drones to make commercial deliveries of packages to remote or difficult-to-access locations. Read the rest of the story here.


3. Ascend Capital invests in three startups

Currently, Ascend Capita has already invested in three start-ups including Omise, SendIt, and a non-disclosed one. For this year, the company aims to leverage its three start-ups in its first batch with no more investment. Read the rest of the story here.


4. DHL Express has opened its Jakarta Gateway 530 facility

The new 1,353-square-metre facility is an addition to the existing Gateway 510, which is at full capacity. Gateway 530 is capable of handling up to 2 million shipments per year and is equipped with dual-view X-ray screening, an explosive trace detector system and 103 CCTV cameras. Read the rest of the story here.

UPS has released its ‘2016 Made in China 2.0’ report, according to the company’s official press release.

The MiC 2.0 report provides a clear way forward for China’s manufacturing sector, as it faces challenges and headwinds and is intended to provide insight and information to Chinese export manufacturers and leaders who can then use it to implement successful strategies.

Export manufacturers are more pessimistic than before, with 29% of the companies saying the economy is worse than in 2014.

Chinese export manufacturers are facing challenges on demand and supply, two of the most commonly-cited challenges are increasing competition from Chinese companies (39%) and decreasing demand from Chinese customers (37%).

It’s not enough to offer a lower price to remain competitive, instead higher quality products (83%), showing an understanding of the customers’ business (82%) and offering a faster and more efficient supply chain (82%) are the top reasons for customers to switch suppliers.

MiC 2.0: no longer enough to think domestic

  • 97% of MiC 2.0 leaders sell to at least one market in Asia and are more focused than other export manufacturers on key markets in Asia and Europe such as Thailand (161%), Hong Kong (151%), France (126%), Indonesia (116%) and the UK (115%).
  • It is also important to serve a diversified customer base of both B2B and B2C customers. Export customers that are focused on B2B manufacturing are associated with low quality production and lower margin operations.
  • Industry leaders are more likely to recognize the importance of logistics and emerging trends such as industry ecommerce (29%) and consumer ecommerce (24%). Identifying these trends can set manufacturers apart.

UPS’s role in boosting China’s manufacturing sector

UPS wants to provide support for businesses in China as they facilitate global markets. The company is rolling out a new initiative to include later pickup time and faster time-in-transit in key cities such as Beijing, Shanghai and Tianjin.

Customers in Beijing and Tianjin can benefit from faster transit times up to 24 hours, and pickup- cutoff time extension up to 2.5 hours in Beijing, and 3 hours in Tianjin. These changes will help Chinese businesses that are seeking presence in global markets by providing the flexibility to import and export goods more effectively.

Find the official press release here or download the full report here.

United Parcel Service (UPS) reported a 3.2% increase in profit fuelled in part by ecommerce growth, writes Wall Street Journal.

However, the delivery giant warned that a weaker industrial environment will continue to drag on.

Revenue increased 3.8% to $14.62 billion for Q2, while profit rose to $1.27 billion.

UPS predicts that its ecommerce business will grow faster than expected through the end of the year as US consumers continue to show strength.

The company has expanded its margins on the domestic side, despite the slow economy. However, as Chief Executive David Abney said, “We have realized that the key to us is not what the economy may hand to us or may blow against us, but its more about staying focused on our strategies.”

The results show that the company’s efforts to improve profitability in the higher cost ecommerce delivery segment are starting to pay off. But the strength in ecommerce and consumer spending was countered by slowing exports due to an inventory overhang among industrial customers, which is negatively impacting B2B shipments, a traditional stronghold for UPS.

Delivering ecommerce packages tend to be more expensive, due to the scattered nature of the residential deliveries. UPS raised prices across the board, with specific increase targeted at bigger packages that take longer to deliver.

UPS has also been working to pool more consumer deliveries, adding retail locations and lockers for self-service pickup.

Cross border and export shipment growth in Europe helped boost the company’s international results. Shipments from Europe to the US alone grew at a double digit pace in the quarter. UPS has been expanding their operations in Europe and other international markets, executives in the company have also said that they would be keeping an eye out for potential acquisitions in emerging markets.

UPS is a solid example of how companies, whether a global giant or a smaller operation, can focus on strategy which will protect them from a volatile market. It also hints at the logistics giant’s global expansion aspirations.

A version of this appeared in The Wall Street Journal on July 29. Read the full version here.