Insights for Vietnam s e-commerce Market 3 Key Perspectives

Transcription

1 Insights for Vietnam s e-commerce Market 3 Key Perspectives

2 ITL Companies and Strategic Partners Operating Companies Joint Venture Associate Companies Indo Trans Logistics Company Hanoi Express Gateway Indochina Co., Ltd Worldwide Agency Co., Ltd Viet Trans Link Forwarding Speedlink elogistics Dash Logistics Co., Ltd A Joint venture company with Singapore Post Asia Services Co., Ltd ITL Keppel Logistics Co., Ltd A Joint venture company with Keppel Logistics Singapore MLC ITL Logistics JV Co., Ltd Ceva Logistics J.V Co., Ltd ITL With Ceva Logistics Group Air Cargo Logistics Co., Ltd ITL with Air Logistics Group South Logistics Joint Stock Company Southern Waterborne Transport Joint Stock Corporation Vietranstimex Multi Modal Transport Holding Company #1 GSA in Vietnam

3 Key perspectives Trends in Ecommerce Vietnam and Future Ready Domestic Last Mile and Market Capacity Vietnam Cross-border Opportunities and Challenges Case study Air - linehaul service 3

4 Market overview % 45% population using internet in average 2 hours/day % 55.00% 53 91% population own smartphone Numbber of user (million) % 53.00% Nummber of user User Penetration 52.00% 49 Vietnamese e-commerce market growing 25% annually, US$ 4 billion in 2018 and is forecasted to acquire US$ 10 billion in Year 51.00% 50.00% 4

5 Market trends & future-ready Vietnam Omni-channel business model Retail studies show 73% customer base search for products on Internet and 17% of them will make an online purchase Global supply 11% of Vietnamese businesses have e-commerce platform and 32% of these are connected to international platform and partners For businesses with online presence, roughly 40% estimate revenue from online sales to > 50% of total sales Mobile payment Vietnam currently has 34 million people having used mobile payment based on transactions, 29% of them proceed the transaction via mobile platform vs deskptop Logistics for e-commerce On-demand service is one of the hot trends recently (crowd sourcing) Fulfillment is a key driving factor for logistics requirements of growing retailer and ecommerce base in Vietnam 5

6 Domestic last mile Challenges Laws and Regulations There is no official regulation for e- commerce. Mostly using motorbikes which is not suitable for cargo delivery Estimate of shipment fail rate 12-14% Facilities of transportation system (asset & infrastructure) COD payment issue High-cost for logistics Unfinished address standard Priority delivery service on demand Key trends Improving solutions for Pick-up/Delivery. Online banking payments. Rural area delivery solution Same-day delivery 6

7 Domestic last mile market capacity Last mile delivery cover 28% total logistics cost for e-commerce, a business field that has annual growth at 25%. Market estimations shipment per day in > 1,000,000+ for all ecommerce or on demand transactions (platforms equal approx. 500,000 + ) According to McKinsey, 25% people want to pay more money to receive a package faster 7

8 Cross-border e-commerce Consumers are looking overseas for the best deals for products currently unavailable in domestic market Online merchants are also looking for ways to sell and deliver merchandise across the world This phenomenon has made crossborder e- commerce become the key growth engine to B2C trade globally 8

9 Cross-border e-commerce Challenges Solutions Laws and regulations: product returns, consumer right protection, labeling and discounting costs of compliance for cross-border transactions add up quickly with uncertainty. Unable to provide full-landing costs (product net + shipping + duties and taxes) at the time of transaction this in return discourages purchase. Lead time could be unpredictable for cross-border purchases with limited track-and-trace (e.g., postal network). In addition, the reverse logistics for return are costly and complicated. Payments: Security and reliability of payment is a major concern for most businesses and consumers. COD is still the preferred payment method. Using COD service of logistics service provider. Partner with last mile service provider having license and expertise solutions for crossborder 9

10 Cross-border e-commerce Strategic Cooperation with VN Post on Ecommerce Domestic and Cross border In collaboration with VN Post on domestic and international cross-border ecommerce Total volume airfreight traffic international & domestics 40,000 ton / year Solution for SME nationwide using VN Post network of 11,000 drop points QUANTIUM COOPERATION BETWEEN ITL AND SINGAPORE POST SPEEDLINK CHANGE TO SPEEDLINK WITH 100% ITL CAPITAL

11 Thank You Amanda Rasmussen Steve Thanh