Friday 29 Mar 2024
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This article first appeared in The Edge Malaysia Weekly on August 30, 2021 - September 5, 2021

Nadhir Ashafiq and Goh Chee Hau are using their digital logistics platform, TheLorry, to uplift the status and income of lorry drivers

A common misconception surrounding technology start-ups is that their service replaces physical labour and in doing so, takes away jobs. This is the reason the digital industry is often viewed with concern, especially when disruptive tech-enabled start-ups acquire a critical mass of customers.

TheLorry, however, settles this misconception about job loss. Its business model creates work opportunities for low-skilled workers and enables them to increase their take-home pay. “This is the value that I wanted to provide when conceiving the business idea behind TheLorry. I wanted to transform the lori sewa business by making it accessible, transparent, professional and well-paying,” says co-founder and executive director Nadhir Ashafiq.

“When my co-founder Goh Chee Hau and I launched TheLorry seven years ago, driving a lorry wasn’t seen as professional work. Drivers would advertise their services on handwritten signs placed on trees and poles and customers who needed this service would look out for these signs, call the drivers and negotiate a price. There was no transparency. High-quality customer service was rare and mutual respect, between driver and customer, was unheard of,” the 33-year-old continues.

“We knew then that TheLorry could be an agent of change and uplift the status and income of lorry drivers in this region. Over the years, we have managed to increase their take-home pay and transform the perception of their job. To us, driving a lorry is an important and honourable profession. Lorries are essentially the backbone of the land logistics industry and the pandemic has highlighted, time and time again, the importance of this sector to businesses, households and the economy.”

TheLorry is a leading digital logistics platform with a presence in Malaysia, Indonesia, Singapore and Thailand. The company serves large corporate clients, including multinational brand names such as Ikea, Decathlon, Unilever, Tesco, Coca-Cola, Shopee and Lazada. TheLorry has established relationships with independent lorry drivers — whom Nadhir calls “driver-partners” — that give it access to a fleet size of about 13,000 lorries.

Better pay, greater professionalism

According to Nadhir, TheLorry’s driver-partners earn between RM5,000 and RM7,000 per lorry, on average, every month. Those who opt to take on more jobs, displayed on a mobile application designed and maintained by TheLorry, earn more.

“We have driver-partners who own a few lorries and they often earn between RM20,000 and RM30,000 a month. We also have success stories, for example, a driver who started accepting jobs with us with one lorry and has since acquired four more lorries. He is still working with us. We have another driver who managed to earn enough to get married. Prior to working with us, he couldn’t afford to get married,” says Nadhir.

At the beginning, he and Goh found it challenging to convince lorry drivers to partner TheLorry. Lorries that transport bulky items for customers were, for decades, part of a traditional, old-school industry and most drivers did not even own smartphones. Nadhir recalls meeting lorry drivers in mamak stalls and telling them about a mobile application that displays lori sewa jobs that they could choose to accept.

“I remember the beginning of our journey. It was in October 2014. Goh and I were trying to find lorry drivers to accept jobs that customers were placing on our platform. We were outsiders to the industry and the drivers did not trust us. They didn’t believe that a digital platform could help them to grow their income. We were rejected many times. Some drivers, although they agreed to meet us, didn’t even bother to show up,” says Nadhir.

Most of TheLorry’s driver-partners are from the B40 (the bottom 40% income classification) households. This is the most vulnerable group in Malaysia’s society and they tend to suffer greatly during emergencies and events — such as a pandemic — that shock the economy. Even before the outbreak of the coronavirus, numerous government- and non-government-driven initiatives had been implemented to improve their income mobility.

Besides opening up new work opportunities to its driver-partners, TheLorry provides them with insurance, vehicle maintenance services and financing options. Nadhir points out that the company’s driver-partners are its first touch point with customers and thus, the key to the success of its operations.

“We want our driver-partners to work as professionals and serve long-standing customers and earn good income. So, we offer hard and soft skill training such as customer service. As a tech platform, we look for ways where technology can help them to increase their efficiencies and lower their cost. Since TheLorry is an established company with critical mass, we can negotiate with financial institutions to offer invoice factoring to our driver-partners, which helps to keep their financial wheels turning,” adds Nadhir. Invoice factoring enables small business owners to access cash for their short-term financing needs.

TheLorry is establishing partnerships with oil and gas companies to give rebates to its driver-partners when they refuel their vehicles.

“TheLorry is premised on an inclusive platform. This means that we don’t force our driver-partners to accept requests for their services. They are free to decide for themselves if they want to accept requests for the stated fee. We also programme our algorithms so that new driver-partners are given an equal chance to find work. This is to avoid the situation where only highly ranked driver-partners are given the opportunity to accept work requests,” says Nadhir.

During the pandemic, TheLorry has been actively recruiting more driver-partners. Demand for transport services surged during the lockdown periods and Nadhir says the company tends to over-recruit in order to meet periods of overwhelming demand.

To be accepted as a driver-partner, local lorry drivers and transporters must be registered with the Companies Commission of Malaysia and attend a registration and briefing process. TheLorry keeps a record of relevant documents such as their driver-partners’ company registration certificate, lorry grant and driver’s licence.

Talent, the key to developing advanced technology in Malaysia

As with many disruptive start-ups, advanced technological solutions play a critical role in TheLorry’s business model. All systems used by TheLorry are developed and maintained by the company. Its propriety algorithm is able to quote the cost based on the type of vehicle selected and the distance between pickup and drop off points. The price displayed to customers is the final price to be paid, unless the actual trip differs from the information specified during the order request.

The company has a team of 130 employees across four countries, with about 80 based in Malaysia. Like many companies in the country, finding and keeping highly skilled tech talent is a pain point for TheLorry.

“There is a clear need to develop the tech talent pool in Malaysia [to be ready for the future economy]. People with these skills are in demand now, more than ever. Local tech talent can pick and choose where they want to work and the biggest companies, the multinational conglomerates, often recruit the best talent in the country,” says Nadhir.

“This means that smaller companies, start-ups like TheLorry, have no choice but to hire those without experience, such as fresh graduates, and support them in learning on the job. Start-ups like us can offer tech talent an option of working on a mission-critical, large-scale project that they, as a young employee, may not have access to in a large organisation.

“We are fortunate that some of our tech talent who joined us as fresh graduates in our early days are still with us. Once TheLorry started to build a reputation and people got to know of us, it became easier to hire highly skilled talent. But the truth of the matter is that start-ups that are starting out will probably find it hard to hire tech talent who can take their company to the next level,” he adds.

To thrive in the digital age, Nadhir believes the country must focus on building a sizeable pool of tech talent. With this in place, global tech players will be compelled to establish research and development centres here, which would eventually bring about more digital innovations and a transfer of knowledge.

“This environment is a virtuous cycle that drives economic development and provides learning opportunities and careers in the high-tech environment for young talent. These are also the best conditions for start-ups to thrive. All these will contribute towards the country’s digital agenda,” says Nadhir.

He believes that developing a highly skilled talent pool should start with the basics, which is what is taught in schools and institutions of higher learning. “For example, Swift, a programming language used by Apple, is not taught in universities. As a result, there is an undersupply of iOS developers who can create apps for Apple’s products in the country. Learning must be relevant to the real-world experience and this is especially true for the tech industry,” says Nadhir.

Besides access to a pool of talent, the digital start-up ecosystem in the country would also benefit from a more targeted approach to entrepreneurial development. Nadhir finds the current landscape — made up of numerous government entities — to be inefficient and cumbersome.

“A simplified but focused landscape consisting of a few government entities would enable entrepreneurs to focus on building their start-ups by minimising the need to seek approval or support from different organisations,” he says.

“Finally, I believe that we need to encourage successful entrepreneurs to pay it forward by mentoring aspiring entrepreneurs. Mentors bring so much to a start-up ecosystem. I have personally benefitted from the advice and guidance of successful entrepreneurs in the global logistics industry, so I know how invaluable this support is for business owners.”

During the first Movement Control Order (MCO) implemented in March 2020, TheLorry struggled. At the time, Nadhir and Goh took a 60% pay cut and shelved their expansion plans. Nadhir, for the first time, experienced a tightening in his chest — a condition which he attributes to high levels of stress.

“Without a support group of fellow CEOs to talk to every night — these sessions are called ‘pillow talk’ — I would have been severely depressed. My peers, mentors and friends were critical in helping me to reflect and put things in perspective,” he says.

Things took a turn for the better when the MCO was lifted and TheLorry resumed operations. The focus on serving e-commerce merchants — a strategic business decision made during a management retreat in late 2019 — proved to be fortuitous on the back of a surge in online shopping during the pandemic.

In the middle of 2020, TheLorry’s revenue hit an all-time high, and the shelved expansion plans were back on the table again. “We thought the economy would be bad because of Covid-19 but people started buying things online, including bulky household items such as fridges, sofas and washing machines. The online shopping trend looks like it’s here to stay, so we decided to go ahead and move into a new centre as well as invest in technology and people,” says Nadhir.

TheLorry’s new sorting facility in Shah Alam is 150,000 sq ft — significantly bigger than its previous facility of 25,000 sq ft.

Lessons learnt during Covid-19 has honed Nadhir’s leadership skills — he had not experienced a severe economic downturn prior to 2020. “I think it’s the same for all millennial corporate leaders. This experience has taught me how to tighten my belt and the importance of a supportive community.

“Looking back, if I had known that business was going to turn around so quickly, I would not have let some people go. But how do we predict the future? It was something that I had to do, at that point, for the business to survive,” he says.

“If I were to embark on another venture, it would be directed at nation-building. I would like to see the local tech industry move up the maturity curve and reach a point where the biggest global tech players would come to this country for their research and development,” says Nadhir.

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