Pos Malaysia: We'll deliver e-fulfilment by end of June

KUALA LUMPUR: Pos Malaysia Bhd is confident of becoming a comprehensive end-to-end e-fulfilment service provider by June 30, 2017 to tap into the e-commerce boom in Malaysia.

“E-fulfilment” is the term used to describe the complete process used by a company, most often an e-commerce player, from the point-of-sale onwards to the delivery of a product to a customer.

Pos Malaysia’s e-fulfilment business encompasses warehousing, last-mile delivery, value-added services and other logistics services to online retailers.

Group CEO Datuk Mohd Shukrie Mohd Salleh said the group is building up its capabilities and infrastructure to have a complete range of e-fulfilment services required by the industry.

“We’ll be ‘sexier’ in the eyes of our customers. We can provide a lot more services. Everything will be under one umbrella (of Pos Malaysia) and you can have whatever that is needed by
e-commerce players,” he told SunBiz in an interview recently.

To be a complete end-to-end e-fulfilment service provider, Shukrie said one needs to have services that can meet the demand of e-commerce players, such as a proper e-commerce warehouse, a combination of same-day delivery, next-day delivery, and even deferred services.

He said there is hardly any player in the country that is able to provide end-to-end e-fulfilment services to e-commerce players at the moment, such as having an e-commerce warehouse. Logistics players are still unable to meet the expectations of the e-commerce marketplace.

“As far as our services are concerned, we want to provide complete services. To a large extent, we’re almost there (being an end-to-end e-fulfilment service provider). Our target is to become a complete end-to-end e-fulfilment service provider by June 30, 2017. We’ve listed items that we need to call ourselves a complete e-fulfilment player and e-commerce-ready.

“We have a long checklist to complete by June 30, but we already have at least half the items. We will push hard to achieve this,” Shukrie said, explaining that this includes improvements in warehousing, delivery and processes.

He said Pos Malaysia will benchmark its efforts against world standards, as there is a gap between the standards in Malaysia and, for instance, China, which is more advanced in e-commerce.

“We have warehouses but they may not be complete e-commerce warehouses, where the racking, retrieving, software systems are different. They (developed e-fulfilment markets) even have value-added services such as kitting, and a whole warehouse system that caters for
e-commerce.”

On delivery, Shukrie said one must have real-time track-and-trace and be able to provide various reports required by e-commerce players that emphasise the importance of data analytics.

“It’s not just about us doing delivery but also feeding data to the marketplace for them to understand the behaviour of their customers. We also need to look at the ability to offer services like cash on delivery, as well as credit and debit card (payment) on delivery,” Shukrie said.

He added that when it comes to the growth of the business, e-commerce players want everything to be system-driven and automated to capture data.

“Being a comprehensive e-fulfilment service provider means meeting all your (e-commerce players’) requirements, real-time tracking, cash on delivery, API (application programming interface) to extract data,
e-commerce system in warehouse, people trained in e-commerce and the list goes on. That’s what we aspire to achieve.”

The national postal organisation expects its courier business to make up half of its revenue for the financial year ending March 31, 2017 (FY17), from 45% in FY16.

“Once it’s half, it will be the single largest contributor to the revenue of Pos Malaysia. Our fortune to a large extent depends on e-commerce,” said Shukrie.

He said Pos Malaysia continues to expand its Pos Laju network.
“Beyond just adding branches, we’re automating a lot more of our branches. We’re going to introduce the 24/7 concept whereby we’re putting in more machines. The idea is to transform as many of our Pos Laju centres into 24/7 service centres.”

Going forward, Shukrie said customers can choose to have their items delivered to the nearest parcel lockers in light rail transit stations, petrol stations and shopping complexes.

Pos Malaysia, which already has an existing transhipment business with China’s
e-commerce giant Alibaba, is open to looking for a strategic partner for Pos Laju, which is the group's cash cow.