New e-commerce logistics aggregators are emerging in Thailand this year to provide one-stop delivery for online merchants, thanks to the popularity of online shopping.
There are at least four logistics aggregators for online merchants in the country: aCommerce Co, Shippop Co, Giztix and SME Shipping Co.
"The growth of online shopping is driving demand for logistics services with many players and price structures. E-commerce logistics aggregators fulfil the needs of online merchants," said Sutthikead Chantarachairoj, chief executive and co-founder of Shippop Co, a Bangkok-based firm.
The company partners with logistics companies to offer a single system that helps online merchants to connect with logistics providers and manage their parcel deliveries.
Online merchants can use its website to register their delivery order details. The system then offers the best delivery fees by comparing the charges of Shippop's logistics network partners.
In the past year, the company has registered 1,300 online merchants that sell through social media (social commerce) and connect with Thailand's leading e-marketplaces, such as tarad.com and lnwshop.com.
"Our next phase will expand to cross-border logistics providers to support online export merchants," said Mr Sutthikead.
E-commerce logistics service grew 9.6% to 70 billion baht last year from 64 billion baht in 2015, according to the Electronic Transactions Development Agency.
"Thailand's e-commerce is driven by small and medium-sized entrepreneurs (SMEs) who sell on social platforms," said Phensiri Sathianvongnusar, chief operating officer of aCommerce Thailand.
The company estimates e-commerce in Thailand will reach US$51 billion by 2025, up from today's $1 billion.
"We believe one-third of Thailand's e-commerce gross merchandise value is happening on Facebook, Instagram and Line combined, and 51% of Thais shop on social media," Ms Phensiri said.
Ms Phensiri said SMEs still rely on manual processes to operate their e-commerce businesses. Once orders are received and packed in their living rooms, merchants have to visit the local post office to ship the package.
To fill the gap in the manual process, aCommerce has introduced SmartShip platform, which is aggregates multiple third-party logistics providers (3PLs), offering SMEs a single interface to manage their e-commerce deliveries.
By consolidating thousands of orders across many merchants, it helps SMEs find the best 3PL for cost-effective shipping rates and the earliest delivery times.
SmartShip sends automated shipping labels and direct billing to merchants, cutting out long queues at post offices. Merchants can provide cash-on-delivery (COD) payment to their customers and shipping insurance.
The company found that 75% of Thailand's e-commerce payments are still through COD as less than 10% of Thais own a credit card.
"Supporting COD payment will enable SMEs to widen their reach to untapped customers," Ms Phensiri said.
For drop-off locations, merchants will be able to choose over 400 partner counters and the number will increase to 70,000 by 2018. SmartShip's next phase will include expansion to Indonesia, the Philippines, Singapore and Malaysia.
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