Parcel deliveries to sustain on e-commerce boom

The MCO boosted demand for Pos Malaysia’s SendParcel service, which has processed over 3.3m packages since its launch in September 2019


DEMAND for package deliveries grew 35% in volume with a surge in online shopping during the Movement Control Order (MCO) which started in March this year, said Pos Malaysia Bhd CEO Mohamed Rozaidi Md Sharif.

The MCO boosted demand for Pos Malaysia’s SendParcel service, which has processed over 3.3 million packages since its launch in September 2019.

“To cope with the increase in the number of parcel volumes, Pos Malaysia provided 1,400 jobs for delivery partners to deliver the parcels under a programme called Pos Rider.

“Last-mile delivery is a critical part of Pos Malaysia, and through Pos Rider, we have delivered a higher number of parcels and created job opportunities for those who lost their income from the MCO,” he told The Malaysian Reserve (TMR).

Given the shift in consumer spending behaviour, Pos Malaysia continues to enhance its digital presence and efficiency through its website and mobile app, and improve workflow automation, cashless payment and its track and trace system.

Mohamed Rozaidi said Pos Malaysia continues to operate under the Conditional MCO (CMCO), following strict standard operating procedures. However, its operating hours at selected post offices and Pos Laju outlets within red zone areas in Kuala Lumpur, Selangor and Sabah have changed during the period in line with directives set out by the National Security Council.

“Due to the increased number of parcels and shortened business hours, deliveries are expected to be slightly delayed. We seek our customers’ patience during this phase as we are working diligently to ensure deliveries are carried out as quickly and efficiently as possible.

“To cope with the demand, we recruited Pos Riders through crowdsourcing to help with parcel deliveries and increase back-end sorting resources,” he explained.

Ninja Van / TMR

Ninja Van Malaysia foresees that its parcel volume forecast will achieve a new record high due to the CMCO period nearing the year-end shopping season

Record-high Parcel Volume

Ninja Van Malaysia CEO Adzim Halim said demand for parcel deliveries is expected to sustain even when the threat of the virus dissipates as more turn to online shops.

“We are almost towards the end of the year with the current CMCO, which also means we’re entering a phase of intense year-end shopping season.

“Coupled with high parcel volumes as more people are shopping online in this new normal, we foresee that our parcel volume forecast will achieve a new record high during this time,” Adzim told TMR.

The immediate effect of the MCO in mid-March saw a sharp drop in parcel volumes handled across the industry as there were a lot of uncertainties over what was allowed for businesses to operate.

“After a few weeks, we noticed our volumes began to pick up again with more people staying indoors and opting for online shopping. “The market rebounded significantly higher than pre-MCO levels after that and parcel volumes have remained elevated since. This trend has continued post-MCO,” Adzim said.

Delivering the Essentials

For Teleport, AirAsia Group Bhd’s logistics arm, the MCO served as an eye-opener which forced the company to realise the importance of forming direct connections with end-consumers.

Teleport CEO Pete Chareonwongsak said business-to-business deliveries took a dip during the MCO, except humanitarian aid deliveries, allowing the company to rethink of its model and the value it could offer.

“Recognising an opportunity, we decided to form direct touch-points with end-consumers via AirAsia food and AirAsia fresh.

“Our focus was on good food and fresh produce — the essentials, which remained a necessity even during the MCO. We charged merchants 0% commission to support their business,” he told TMR.

Pete said post-MCO, the business saw a slight dip in both food and fresh deliveries as people were excited about the idea of having a social meal and stepping out of their homes.

With the recent CMCO, Teleport saw its business picking up again for both essential items and non-essentials.

“We have been receiving plenty of orders to be delivered to customers with increased sales of 1,000% for AirAsia fresh and a 500% sales increase for AirAsia food. We also saw a 700% increase in sales for AirAsia shops,” he said.

“With people being somewhat ‘forced’ to try e-commerce, we expect a lasting change in consumer behaviour when it comes to shift from offline-to-online consumption,” he said.

“What drives that switch is a great delivery experience, which is why we saw another opportunity with 24-hour domestic and regional delivery for parcels and a one-hour instant delivery service within the city,” he added.

According to AmBank Research, a crowded playing field (with 116 players as at March 2020) has given rise to cut-throat competition resulting in a severe squeeze in margins.

Nabil says the upcoming Budget 2021 should be an intensified version of what was provided for 2020 – TMRpics

Budget 2021 Hope

Separately, Dego founder and CEO Nabil Feisal Bamadhaj said delivery business activity overall has been good, with fewer people travelling to work or public spaces.

He expressed his hope that a large portion of the growth post-pandemic will adapt to the advantages provided by utilising online services, with the buying and delivering becoming a part of the new norm of society.

“Post-2020, we expect business to be driven by the continually growing segment of individual income operators, individual business owners, entrepreneurs, and small and medium enterprises (SMEs).

“This group needs more help and support than ever provided to them to get back up as this segment contributes a large portion back to the growth of the economy,” he told TMR.

He said the upcoming Budget 2021 should be an intensified version of what was provided for 2020, by offering both direct and indirect stimuli, and direct or temporary relief for the group.

He said access to relief should be made more accessible for target groups, citing the example of the RM30 to RM50 e-wallet grant or RapidPass discounts for commuters.

“Registered independent income earners, entrepreneurs and SMEs who meet the eligibility requirements should also be awarded marketing grants that could help support and promote their products to a more extensive customer base.

“This is one of the things we are focusing on that has been brought forward due to the Covid-19 situation. We hope that we can play a part in the country’s digitalisation efforts,” he concluded.