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Switching arguments - a breakthrough opportunity for Vietnamese logistics enterprises

10:23 | 07/11/2022

VCN - Logistics activities combined with digital transformation are extremely important, which is a modern way to connect manufacturers, carriers and consumers, creating breakthrough opportunities for Vietnamese logistics enterprises in the new phase.

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Switching arguments - a breakthrough opportunity for Vietnamese logistics enterprises
Modern warehouses will help businesses facilitate production. Source: Internet.

Link to develop

At the Forum "Logistics Vietnam transforms and develops" held recently, experts said that there is an opportunity to break through Vietnam's logistics for a new period, especially smart logistics, with the explosion of the Industry 4.0 revolution, there have been many applications of science and technology in logistics activities in Vietnam.

The strong development of e-commerce poses more and more modern optimization problems to meet the diverse needs of customers. This means many businesses in the logistics industry in Vietnam need to change and "transform" in an irreversible trend with the investment in modern warehouse infrastructure, applying digital and automatic management in operation, the management model is increasingly professional.

In order to develop infrastructure, attract and develop logistics, Nguyen Cong Bang, Deputy Director of the Transport Department, Ministry of Transport, said that logistics activities combined with digital transformation are extremely important. It is a modern way to connect manufacturers, transporters and consumers, not to mention traders. From there, it will create a transparent investment legal environment and a fair operating environment so that the circulation of goods is increasingly modernized.

According to Bang, instead of orienting to compete with each other in activities, attracting investment in the field of logistics, localities and businesses should sit together, create connections and synchronization to develop together.

Creating connections between localities and businesses not only helps the development of the logistics industry, but also brings synchronization and unity in operations, as well as infrastructure.

Given that businesses face difficulties in digital transformation due to a lack of connectivity, Le Thi Ngoc Diep, Commercial Director of SLP Vietnam, said that the biggest problem is the connection and integration of current logistics service delivery systems. According to Diep, it is necessary to consider many different aspects, in terms of infrastructure, Vietnam is in the stage of synchronizing and perfecting the transport system or planning on seaports, planning on warehouses, but not yet. There are standards, but there are still many scattered, it can be seen that the warehouse system is mainly planned in the South, only 30% is planned in the North.

These are limitations in the transportation of goods across the country that affect the entire supply chain management.

Create a modern warehouse system

According to experts, one of the limitations of logistics service enterprises is that the warehouse system is still modest and unevenly distributed.

For example, Ho Chi Minh City is a key area in the South, but the warehouse system has not developed commensurately. According to Bui Ta Hoang Vu, Director of Ho Chi Minh City Department of Industry and Trade, currently, Ho Chi Minh City has 1,505 warehouses, of which 520 are manufacturing enterprises. Warehouses are mainly developed on a large and small scale depending on the needs of shippers. In general, warehouses and distribution centers in the Ho Chi Minh City area tend to shrink and gradually move to Binh Duong and Dong Nai due to limited land funds. The cold storage system has not been developed, few businesses invest in cold storage while the demand for cold storage is quite high, leading to difficulty in renting cold storage and high storage charges.

Le Trong Hieu, Senior Director of CBRE Vietnam, said that for modern warehouses, in order to use space effectively for operators and customers, it is necessary to cut shipping costs and increase order processing capacity.

According to Hieu, through CBRE's survey, many businesses believe that taking advantage of more space will be achieved when there is more automation in the warehouse, helping to process orders as well as customer requirements. customers faster. With previous warehousing facilities, it would be difficult to increase order processing capacity, so this is a good opportunity for the construction of modern warehouses. It can be seen that modern warehouse equipment has a bright future for development in Vietnam. Currently, single-storey warehouses are still quite popular, however, 2-3-storey warehouses are also gradually being expanded, meeting the requirements of fire protection as well as meeting the required standards of many international users and customers, about the equipment in the warehouse.

Regarding future trends, Le Trong Hieu said there are two trends: First, automation and technology. As an Amazon representative said, technology has helped Amazon become the world's leading e-commerce service. If we go to an automated smart warehouse like Amazon's, we will feel like a "symphony" of humans and machines working together.

Second is the trend of cold storage. This is a very specialized infrastructure to meet the needs of customers. After the Covid-19 pandemic, not only in Vietnam but also in many other countries and territories around the world, the demand for online shopping for vegetables and fruits, necessities, medicines and pharmaceuticals has increased. People are increasingly concerned about the quality and safety of food and pharmaceutical products, and the government is also paying more attention to this aspect.

According to experts, Vietnam's logistics market has the participation of more than 5,000 businesses, but most of them are small-scale businesses and there are many businesses that have not yet been able to supply deep into the supply chain, this is one of the difficulties to mention. Not to mention, many businesses can only participate in the supply chain as a subcontractor for professional logistics enterprises and this is one of the problems in Vietnam's logistics industry today.

According to Le Thi Ngoc Diep, 4.0 technology application is said to be one of the supporting tools for businesses to boost their capacity and efficiency, but in fact this is a problem for businesses. Modernization in the logistics management operation system to create a professional management system is the combination not only of modern infrastructure combined with technology application but also between modern and professional logistics service providers to create values for the logistics industry to adaptive logistics and strong development.

By Le Thu/ Huu Tuc