In a recent interview at the Asia Warehousing Show in Bangkok, we had the pleasure of speaking with Mr. Eddie Lee, E-commerce Director, Greater China SEKO Logistics, about last-mile delivery services in e-Commerce.
He began by explaining that their are two different types of fulfillment models. One is domestic fulfillment, which is normally easier because the goods are all in country. A customer need only determine the speed of delivery to pick the best corresponding carrier or postal provider.
Mr. Lee went on to explain that, “The second channel is cross-border fulfillment. The idea is to have inventory in a single location that is then going to fulfill the entire region and any of the countries within. So whenever you receive an order, your order is actually dispatched from that single location. However, with cross-border activities you’re inherently going to face some problems. For instance, some of the countries in Asia, their customs clearance process may not be as up to par. You have to pick the right partner to do your customs clearance as well as your last mile deliveries. If you’re talking about cross-border it’s very hard to send it back to the origin, to the main warehouse. So with these factors, last mile delivery will be very critical in Southeast Asian countries.”
Speaking about what would boost e-commerce in Southeast Asia, Mr. Lee explained that cash on delivery (COD) is particularly important. “The number of people holding credit cards in Southeast Asia, except in Singapore, is very low. With COD vs pre-pay by credit card, we’re talking about a 3:1 ratio. If you think about this region here, and if you want to penetrate sales, COD for last mile is very important.”
Check out the video above if you would like to hear more of Mr. Lee’s insights into the industry.