Logistics SMEs urged to speed up digital transformation

Vietnamese logistics firms, especially small and medium-sized ones, need to get up to speed on digital transformation to enhance their competitiveness if they want to enter global markets after the pandemic ends, experts have said.

Nguyen Ngoc Dung, Vice Chairman of the Vietnam E-commerce Association, said it is high time that SMEs realised the advantages of and the urgent need for digital transformation, pointing out that most of them have remained slow in embracing it.

“Successful digital transformation will bring many benefits to businesses such as reducing costs and enabling them to access all markets.”

A shipper in Vietnam delivers two parcels a day on average since it takes time to locate addresses and wait for recipients to collect the order, whereas a shipper in a developed market could deliver 200 a day with map data to optimise routes, he said.

“High logistics costs not only affect the competitiveness of goods, but also pose an obstacle for businesses when entering new markets.”

He was speaking at a seminar on “Logistics industry before the turning point of digital transformation” last week.
Nguyen Tuong, Deputy General Secretary of the Vietnam Logistics Business Association, said the COVID-19 pandemic has affected global investment and trade, and supply chains have been disrupted.

Enterprises, especially logistics firms, must apply hi-tech solutions to reduce costs, he added.
Tuong listed three challenges that prevent logistics companies from adopting digital transformation: financial capacity, human resources and identifying suitable technologies.

There are only a few international standard software offerings in Vietnam, making it difficult for firms to identify optimal ones, he said.

Besides, logistics companies’ managements are not confident about data and payment security when implementing digital transformation, he said.

“Both executives and staff remain hesitant about changing their habits for the digital environment. Thus, we need to change the perceptions held by logistics companies.”

According to the Vietnam Logistics Business Association, not many logistics firms adopt integrated solutions in their logistics and supply chains.

Around 40 percent of software applications remain very basic such as international forwarding management, warehouse management, transport management, electronic data exchange, and customs declaration, he added.

Tuong said the Government should prioritise development of infrastructure and logistics service centres, and offer income and other tax breaks.

Policies are needed to ease business conditions, simplify inspection procedures and mobilise resources for investment in logistics, especially regional and international logistics centres, he added.

Ngo Khac Le, a lawyer and arbitrator at the Vietnam International Arbitration Centre and an expert in logistics and transport, said SMEs can learn from the experience of large logistics enterprises that have applied digital transformation at a rather high level.

Experts said to capitalise on the EU-Vietnam Free Trade Agreement, Vietnamese firms need to meet three main criteria: product origin, quality and digital capability.

EU businesses are 10-15 years ahead of their Vietnamese counterparts in terms of digital capacity, and so the latter must strive to achieve comparable levels to be able do business with them, they said.

Thus, digital transformation is an inevitable process and Vietnam would be left behind if it does not do it, they warned.

Enterprises should start to get acquainted with e-contracts, pay digital taxes and digitise all business activities, they said.

Digital transformation refers to creating a new operating method based on digital technologies like IoT, cloud, big data, AI, and blockchain to create new production and business models.

Vietnam’s logistics costs are 6% higher than Thailand’s, 7% higher than China’s and 12% higher than Malaysia’s.

The high costs have hampered the competitiveness of Vietnamese goods, according to experts.

According to a recent report by the World Bank, logistics costs are equivalent to 20% of Vietnam’s GDP, while in other countries it is 9-14%.

Economists said in the context of the prolonged epidemic, the use of digital transformation for market access and penetration is even more vital. If Vietnam wants to improve the quality of logistics services it needs to have a clear roadmap.

Source: VNA
vov.vn

Related News

Seafood businesses adapt to the new situation

Seafood businesses adapt to the new situation

VCN - Facing the fluctuations in export markets and the impact of logistics supply chains, seafood export businesses have made changes and adapted to the new situation.
Lang Son promotes border gate management and development

Lang Son promotes border gate management and development

According to the leaders of Lang Son Provincial People's Committee, the province is currently focusing on improving the quality of planning and planning management, especially implementing logistics service center planning; focusing on mobilizing investment resources, building infrastructure projects and developing production and business in border gate areas.
Vietnam

Vietnam's trucking industry in the context of Asian logistics development

VCN - Vietnam's Logistics Performance Index (LPI) has increased to 3.3 points from 3.27 points in 2018, indicating gradual improvement, especially in customs procedures and infrastructure quality.
It is necessary to modernize Dong Dang international railway station to meet current regulations

It is necessary to modernize Dong Dang international railway station to meet current regulations

VCN - To ensure customs management and supervision at the border gate area of Dong Dang international railway station, Lang Son Customs Department proposed Vietnam Railway Corporation to continue to install cameras and software according to the provisions of Decree 68/2016/ND-CP, amended and supplemented in Decree 67/2020/ND-CP.

Latest News

ASEAN, RoK agree on transposition of AKFTA product specific rules

ASEAN, RoK agree on transposition of AKFTA product specific rules

ASEAN member states and the Republic of Korea (RoK) have reached a consensus on the transposition of ASEAN-RoK Free Trade Agreement (AKFTA) Product Specific Rules from the Harmonised System Codes HS 2017 to HS 2022.
Opportunities for digital technology businesses to go global

Opportunities for digital technology businesses to go global

Finding solutions and directions to promote and develop Vietnamese digital technology enterprises is an important task, which will promote the stability and sustainability of the country's economy, heard a recent conference.
Vietnam, China eye stronger border trade

Vietnam, China eye stronger border trade

Border provinces of Vietnam and China should continue close coordination and enhance trade promotion between the two sides, stressed the recent talks between the management boards of the economic zone of the northern province of Ha Giang and the Malypo border economic cooperation zone of China’s Yunnan province.
Improve competitiveness and sustainable development of the seafood industry

Improve competitiveness and sustainable development of the seafood industry

VCN - In early 2024, seafood exports have prospered. This is the driving force that helps seafood businesses hope for a stronger recovery this year. Ms. Nguyen Thi Thu Sac, Chairwoman of the Vietnam Association of Seafood Exporters and Producers (VASEP) shared with Customs Magazine.

More News

Business environment reform needs further promotion: expert

Business environment reform needs further promotion: expert

Resolution 02 issued by the Government creates pressure for the ministries, sectors and localities to make changes for the business community as well as the socio-economic development.
Singapore is the largest foreign investor in VN in Q1

Singapore is the largest foreign investor in VN in Q1

The disbursed FDI rose by 7.1 per cent in the first quarter to reach $4.63 billion, a signal that the disbursement will continue the positive trend, the agency said.
Thai Binh boosts investment, trade cooperation with Germany

Thai Binh boosts investment, trade cooperation with Germany

A delegation from the northern province of Thai Binh, led by Deputy Secretary of the provincial Party Committee Nguyen Khac Than, visited several localities and business organisations in Germany from March 25 to 27, in a bid to enhance trade cooperation with and attract direct investment from the European nation.
Lifting obstacles to develop industrial parks

Lifting obstacles to develop industrial parks

VCN - Attracting investment and developing industrial zones (IZs) and economic zones (EZs) is one of the important contents to implement the policy of developing a multi-component, open, attract investment and resources from all economic sectors to develop the country. In addition to the results achieved, there still limitations that need to be removed to draw investments to develop industrial parks and economic zones, including financial problems for industrial parks.
Unlock capital flows and create favorable conditions for investors

Unlock capital flows and create favorable conditions for investors

VCN - Talking with the press, Dr. Ngo Cong Thanh (Photo), Provisional Executive Committee member of the Vietnam Industrial Park Finance Association (VIPFA), said that it is necessary to open up capital flows and create conditions for investors to access key factors. Facilitate production and business factors and innovate investment promotion activities to more effectively develop industrial parks.
More than 300 businesses, manufacturers to attend VGMF 2024

More than 300 businesses, manufacturers to attend VGMF 2024

More than 300 domestic and foreign businesses and manufacturers will attend the Vietnam Global Manufacturing Forum 2024 (VGMF2024) to explore investment and business cooperation opportunities.
Connecting with FDI firms helps boost wood exports: insiders

Connecting with FDI firms helps boost wood exports: insiders

Strengthening linkages and cooperation between foreign-invested and domestic enterprises will contribute to promoting the sustainable development of the Vietnamese wood industry, according to insiders.
Doosan Vina exports nearly 2,000 tonnes of modules to US

Doosan Vina exports nearly 2,000 tonnes of modules to US

The Doosan Enerbility Vietnam (Doosan Vina) specialising in heavy industries announced on March 26 that it has just exported a batch of nine modules weighing nearly 2,000 tonnes to the Golden Triangle Polymers company in Texas, the US.
Wood processing enterprises strive to increase the proportion of individually designed goods

Wood processing enterprises strive to increase the proportion of individually designed goods

VCN - Many wood and furniture processing enterprises are promoting investment in design activities, helping to increase the proportion of individually designed products (ODM) in exports, thereby affirming the industry's capacity Vietnamese wood in segments with higher added value.
Read More

Your care

Latest Most read
ASEAN, RoK agree on transposition of AKFTA product specific rules

ASEAN, RoK agree on transposition of AKFTA product specific rules

ASEAN member states and the Republic of Korea (RoK) have reached a consensus on the transposition of ASEAN-RoK Free Trade Agreement (AKFTA) Product Specific Rules from the Harmonised System Codes HS 2017 to HS 2022.
Opportunities for digital technology businesses to go global

Opportunities for digital technology businesses to go global

Finding solutions and directions to promote and develop Vietnamese digital technology enterprises is an important task, which will promote the stability and sustainability of the country's economy, heard a recent conference.
Vietnam, China eye stronger border trade

Vietnam, China eye stronger border trade

Border provinces of Vietnam and China should continue close coordination and enhance trade promotion between the two sides, stressed the recent talks between the management boards of the economic zone of the northern province of Ha Giang and the Malypo border economic cooperation zone of China’s Yunnan province.
Improve competitiveness and sustainable development of the seafood industry

Improve competitiveness and sustainable development of the seafood industry

In early 2024, seafood exports have prospered. This is the driving force that helps seafood businesses hope for a stronger recovery this year.
Business environment reform needs further promotion: expert

Business environment reform needs further promotion: expert

Resolution 02 issued by the Government creates pressure for the ministries, sectors and localities to make changes for the business community as well as the socio-economic development.
Mobile Version