Deliveree is making Southeast Asia’s logistics environment a little less rough

In many parts of Southeast Asia, transportation logistics are not only difficult but also costly. As a result, the company has developed a platform that not only allows customers hire trucks, but also utilises algorithms to calculate the optimum route depending on geography, freight loads and even the weather. Gobi Partners and SPIL Ventures led the $70 million Series C round, which also included returning investor Inspire Ventures. Since its inception in 2015, the firm has raised a total of $109 million.

Customers are forced to pay more because of the high shipping costs, according to the company’s founder and CEO Tom Kim. In our view of the market, transportation and cargo shipping inefficiencies have pushed up prices significantly. In Los Angeles, California, you’re in the market for a new pair of Nike sneakers. How much of the total sales price goes on logistics, shipping, and storage? The response is well-researched and accessible. 8 percent is the figure. If you purchase the identical Nike sneakers in China, the price difference is around 15%. Buying the identical Nike sneakers in Indonesia, Thailand, or the Philippines will save you 25-30%.

According to the firm, total transaction value has increased by 3.2 times in the last 24 months and will surpass $100 million this year. More than half a million people use its platform every day.

Deliveree is now accessible in Thailand, Indonesia, and the Philippines. In particular, it focuses on big rigs used to transport commercial cargo or bulky things. This logistics company receives more searches, according to Google Analytics, according to Kim. A few examples of these include Waresix in Indonesia, Go Box in Kargo Tech, Logisly in Indonesia; Mober in the Philippines, and TheLorry in Thailand.

A logistics firm like Waresix, which has obtained money from investors, is one of several companies in Indonesia that are battling it out.

“It’s where a lot of startups and disruptive technology in the space is being built, and it’s definitely a very active market,” he told. “There are all these well-known players, like Waresix or even Kargo Tech. The Philippines and Thailand are also interesting and great markets, but there are less players in the logistics space, especially cargo, trucking and freight.”

Deliveree overcomes an issue with wasteful truck utilisation. Trucks, for example, may carry a load of merchandise but then return empty to the warehouses when they have finished their deliveries. Companies may, however, use Deliveree’s system to transport items on its way back if it’s part of the system of the company. The money spent on gasoline, time and dispatch teams may be better used this way.

“There are an awful lot of empty trucks driving around in Thailand, the Philippine and Indonesia, because everyone has their own corporate fleets,” said Kim. “They do one-way delivery and the truck drives back empty. It’s even that way for long-distance deliveries, when you’re sending goods from one warehouse to some kind of facility in an other city. The same thing happens—you send the truck full one way and it comes back, sometimes hundreds of kilometers, empty.”

This is where Deliveree comes in. According to Kim, the marketplace presently includes tens of thousands of clients and providers, including both independent drivers and transportation firms. Because of the sophistication of today’s market and the sheer number of goods it transports, trucks seldom go empty. Demand is aggregated in the market, and best routes are determined to keep trucks filled. Before Deliveree, a utilisation rate of 40% to 50% was regarded above normal, according to Kim. For five years now, Deliveree has been working on an internally developed data collection that allows vehicles to reach up to an 80% utilisation rate in the Deliveree marketplace.

“Even though it’s far from perfect, it gets smarter everyday because we do thousands of bookings every day, and it can make more accurate forecasts about the duration of the booking, the day of the week, the time of the day, even the weather. These are all things that have drastic impact on durations,” Kim said.

Deliveree’s algorithms are able to estimate loading and waiting periods, which implies that warehouses have reduced waiting waits.

As a result of having their own fleets, most businesses have to hire dispatchers, administrators, security personnel, parking lot managers, and other related personnel. According to Kim, this is the predominant method of doing things, and it comes at a high cost to businesses. Kim said that corporations may de-leverage their financial sheets and book trucks on an asset-light basis like Deliveree while offering the service to them. As a result, they are only charged for vehicles when they are really needed.. The epidemic lowered income for many organisations, and Kim says Deliveree was more widely used as a way to make up for that loss of revenue. When firms were trying to discover methods to save money, they turned their fixed expenses into variable costs.

By charging a charge to customers and dividing it with the carriers, Deliveree makes money. The normal delivery ratio is an individual trucker or trucking firm receiving 80% and the company receiving a 20% commission.

“Post-pandemic, we are going towards an inflationary climate beset by supply chain challenges,” Gobi Partners managing director Kay Mok said in a prepared statement. Deliveree has developed the greatest technology platform for clients, which will allow them to optimise and minimise the logistics and shipping company’s overall cost of operation.”