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Driving e-commerce in Southeast Asia

Article - November 14, 2018

From big multinationals to SMEs, companies are poised to tap the potential of e-commerce in the ASEAN market of 650 million people.


With steadfast economic growth, a growing middle class of consumers, and expanding transport and digital infrastructure, Southeast Asia offers exciting opportunities for e-commerce. A recent report by Credit Suisse bank estimates that e-commerce spending in the ASEAN region alone will increase 32 percent a year to reach $90 billion by 2025, and everyone from local SMEs to the world’s biggest brands are poised to tap this growth potential.

The region is enjoying a similar trajectory to that of China over the past two decades. The dragon economy has witnessed incredible e-commerce growth, which has enabled online retailer Alibaba to become one of the world’s biggest companies.

As Alibaba looks to tap into the e-commerce potential of Southeast Asia, it has increased its share in Singapore Post (SingPost) so as to tap into the extensive network and infrastructure of Singapore’s national postal provider as it transforms itself into a global eCommerce logistics company.

And part of SingPost’s investments in state-of-the-art infrastructure and technology is its Southeast Asia e-commerce logistics hub, which it opened in 2016. The S$182 million facility has a total built-up area of 51,358 square metres, consolidating and integrating SingPost’s warehousing and delivery capabilities in one building for faster turnaround and capacity for larger volumes.

“Our goal is to be ahead of the curve so that we are able to cope with increasing volumes. We are well-placed geographically; well-placed as a postal organization to tap into that e-commerce market, and work with other operators, not just postal but also logistics as well,” says Group CEO, Paul William Coutts.

Offering end-to-end e-commerce solutions, from digital marketing to logistics, SingPost is much more than a postal service provider. It is helping some of the world’s biggest brands to expand in Southeast Asia, brands such as Calvin Klein, Clarins and Timberland.

The company also has two e-commerce subsidiaries in the U.S. – Jagged Peak and TradeGlobal. In the year ended March 2018, the two companies landed 28 new customers – ranging from apparel and consumer goods, to cosmetics, and food and beverage – and shipped over 100 million units, valued at over $1.5 billion. Underpinning this success is SingPost’s e-commerce software – EDGE, recognized by the industry as one of the top e-commerce platforms.

“EDGE helps e-commerce companies get to market more quickly, grow their sales quicker, while controlling and reducing their unit costs over time through scalability. It is a unique advantage,” says Mr. Coutts. “We are implementing EDGE technology with our e-commerce customers here in Singapore and Southeast Asia, and will expand that out into Australia, Hong Kong, China, and around the world.”

With innovative technology like EDGE and its end-to-end e-commerce solutions, SingPost has its sights on becoming a global leader in postal and e-commerce logistics. In fact, despite being a 160-year-old conglomerate with a global workforce of over 7,500, Mr. Coutts says the company has the “DNA of a start-up”.

“That is actually something driven through technology, the attitude of our people, and energy within the company to innovate. The company is very entrepreneurial in spirit, which is a bit unusual for postal organizations. We do have some of that start-up mentality, paired with the right infrastructure and technology.”