In Thailand, express delivery operators are exploring novel avenues to move beyond dependency on e-commerce platforms. The industry's move towards premium and value-added services, such as fresh fruit and medical logistics, emerges from a saturated market driven by fierce pricing competition.
Investment in artificial intelligence (AI) and automation characterizes the strategies of these operators, focusing on cost reduction and operational enhancement. The regulatory front is changing, with authorities drafting new rules targeting postal and e-commerce supervision, aiming for increased consumer benefits.
The Thai express delivery market is projected to reach approximately US$3.23 billion in 2024 (117 billion baht), based on revenues from six leading operators. A strategic decision in November 2024 saw KEX terminate agreements with Lazada and Shopee. In response, e-marketplaces have revised logistics fees to US$0.33–0.39, down from the previous range of US$0.50–0.52, to bolster profit margins.
According to Mr. Bao, SF contributes to Thai agricultural exports, facilitating streamlined farm-to-consumer logistics, notably to China. Looking forward, SF leverages big data and AI for network and customer experience optimization. KEX's revised pricing structure, announced this January, bases fees on parcel weight and dimensions to match market dynamics.
In meeting increased demand for produce and plant logistics, KEX enables fresh fruit or plant shipments, capped at 30 kilograms, targeting orchards, shops, and customers. Flash Express supports this segment with a farm pick-up service, without minimum quantity requirements, offering a delivery fee of approximately US$1.38 for the first 2kg.
In 2024, Flash Express posted a profit of approximately US$25.97 million after two years of losses, attributing success to advancements in technology systems and infrastructure. SPX Express Thailand enhances delivery efficiency with AI for demand forecasting and route optimization, striving for reliable services that meet consumer expectations.
DHL eCommerce's Southeast Asia chief, Kiattichai Pitpreecha, outlines tech investments aimed at improving functionality and competitive standing, citing enhancements in AI-driven operational efficiency. Thailand Post is allocating around US$27.6 million to automated systems enhancement across 19 distribution centers. Further adjustment in strategy includes a shift to specialized logistics amidst fluctuating e-commerce parcel volumes.
Healthcare logistics is a new revenue stream for Thailand Post, offering medical delivery services in collaboration with educational and veterinary institutions.
Industry commentary from Sutthikead Chantarachairoj of the Logistech Association points to a softening in price wars as market dynamics shift, with firms like Flash utilizing key metrics and technology integration to optimize business operations.
Anticipating regulatory reform, the draft amendment to the Postal Act of 1934 by the Digital Economy and Society Ministry aims to level the competitive field and ensure service consistency across postal providers. Guidelines emerging from the Trade Competition Commission seek to counter monopolistic and anti-competitive practices by e-commerce platforms.
Source: Bangkok Post
