Boosting deliveries for e-commerce

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The movement control order (MCO) undoubtedly accelerated the popularity of e-commerce. At this time, delivery service providers have been working to meet the increase in parcel shipment volume while still complying with restrictions imposed due to the Covid-19 pandemic.

At the same time, many customers have aired their grouses about tardy deliveries or damaged packages online. Some small and medium enterprise (SME) founders that had to rely on deliveries to sustain their business during the MCO period also expressed frustration at the slow service from some players.

When asked about the complaints directed at Pos Malaysia Bhd, its spokesperson tells Enterprise via email that it has experienced a surge of parcel volume since the beginning of the MCO. 

“We have notified our customers of the potential delays including deliveries from international destinations and to East Malaysia due to cross border restrictions and limitation of flights as part of the Covid-19 preventive measures. We are working tirelessly to maximise our capacity to ensure deliveries are carried out as soon as possible,” says the spokesperson.

Other delivery companies like GD Express Sdn Bhd and City-Link Express have also asked their customers on social media to be patient with delivery times given the surge in delivery orders, especially prior to Hari Raya Aidilfitri. 

“Another challenge for us is the damage to parcels. While we sort and handle all parcels with utmost care, parcels may be damaged due to factors such as the weather, quality or durability of the packaging or unintentional damage during processing,” says the spokesperson.

If a parcel is received with damaged packaging or content, Pos Malaysia will contact the receiver to inspect the content of the parcel at a Pos Laju centre, accompanied by the staff. The receiver can choose to accept the parcel or return to sender.

The spokesperson suggests senders ensure all items appropriately packed using the right box with  adequate packing material and suitable box seals. 

“We also encourage online sellers or individuals to include Pos Laju takaful insurance for shipment protection against damages due to breakage, missing parcels, fire, water damage and accident. Pos Laju takaful can be obtained over the counter at all post offices and Pos Laju centres,” says the spokesperson. 

Tough business conditions

The company was negatively impacted by the MCO as it saw fewer retail transactions in post offices, while its commercial and cargo flights were cancelled. 

The bright spot for Pos Malaysia, which has been making losses for several consecutive quarters, is the rise in demand for courier services, which began at the end of March and continued into April. According to the company, there was an increase of about 35% in parcel volume.

The growing e-commerce sector will present growth opportunities for the loss-making company’s courier segment going forward. “The group (Pos Malaysia) believes that the automation of the parcel sorting centres is key in providing customers with faster delivery speeds, which gives us a competitive advantage,” says the spokesperson.

“Pos Malaysia will continue to invest in digitalisation and e-commerce infrastructure as part of its transformation agenda to boost its performance as a service provider with the widest reach in the country.”

However, this is a crowded space, with at least 116 logistics players hoping to cater to this trend, according to a several analysts. The competition could result in compressed margins and further losses could be expected for the company going forward. 

A few other things that the company has done to improve its services in this area include its Track & Trace system, which began its pilot test this quarter in 16 locations. It is aimed at providing customers with better visibility of the entire parcel delivery process.

Pos Malaysia also has its online shipping platform SendParcel, an online shipping platform for parcel delivery. This is meant to help business and individual customers manage bulk deliveries and find the best rates, instant pricing quotes and other services.

“Registered users [for this service] have increased by 60% while average daily parcel shipment has increased by 176% over the previous quarter. The platform was upgraded to enable international shipments in the first quarter this year and will continue to be enhanced with new features throughout the year,” says the spokesperson.

On the other hand, Pos Malaysia has widened its network of parcel lockers, called Pos Laju EziBox, to 255 locations in Malaysia, and it is working with over 700 retail partners so customers can pick up and drop off parcels for collection at those locations.

What about manpower? Many delivery service providers, including Pos Malaysia, are looking to hire staff to cope with the demand. According to Pos Malaysia, it addressed this problem by crowdsourcing for Pos Riders. 

“This method is gaining traction, with a more than 70% increase in crowdsourced riders compared to the previous quarter. This initiative runs parallel to the group’s Entrepreneurship Programme launched in February, which is aimed at converting full-time delivery personnel to become Pos Malaysia’s delivery partner,” says the spokesperson.

According to reports, this programme converts salaried mail delivery people into a volume or incentive-based mail delivery contractors.