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Logistics firms must cut costs in order to compete

Update: August, 04/2015 - 08:56
Foreign players dominate the market, particularly the international transportation segment, with around 40 foreign shipping firms handling more than 80 per cent of imports and exports. — Photo vantaihoaphat
HCM CITY (VNS)  — With the trend towards deeper integration, Vietnamese firms in logistics and supply chain management need to become more competitive to stay afloat, according to the Viet Nam Logistics Association.

Speaking at a press conference to introduce the 2015 TILOG-LOGISTIX exhibition in HCM city yesterday, Do Xuan Quang, chairman of the VLA, said the logistics sector has grown more than 20 per cent in recent years.

Foreign players dominate the market, particularly the international transportation segment, with around 40 foreign shipping firms handling more than 80 per cent of imports and exports, he said.

Yet domestic companies make up 80 per cent of the more than 1,300 firms in the country.

Most of them lag behind their foreign counterparts in resources, human resources, management and IT use, he said.

Thong Tangsritrakul, vice president of the Thai Federation on Logistics, said logistics in Viet Nam are relatively costly compared to regional peer Thailand, where spending on logistics is only 14 per cent of GDP compared to 21 per cent in Viet Nam.

Enhancing the use of ICT tools like lean logistics processing is among factors that help reduce costs, and businesses need to adopt multi-modal transportation, innovation and technology to improve productivity, he said.

Malinee Harnboonsong, director of the commercial office at the Thai consulate-general in HCM City, said "since logistics is one of the key success factors for international trade, Thailand has been actively instituting new policies that would make all aspects of its transportation infrastructure globally competitive and strengthen transport connectivity with neighbouring countries, including Viet Nam.

"Moreover, for the purpose of ensuring friendship, regional cooperation and development, the Thai Government annually facilitates mission, field trips, seminars, conferences, workshop on logistic industry in order to exchange views, share experiences, provide timely solutions for emerging issues."

Chanapa Lertrungruang, project manager of Reed Tradex Co Ltd, said the 2015 TILOG – LOGISTIX would see the participation of more than 415 global brands in advanced technologies from 25 countries and territories including Singapore, Japan, China, Taiwan, Germany, France, and the US.

Organised by the Department of International Trade Promotion and Reed Tradex from September 2 to 4 in Bangkok, the exhibition would showcase the most diverse range of logistics solutions and information, she said. — VNS


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