Oil giant Shell’s startup wants to solve logistics in Southeast Asia

Vincent Tan, a retail shop owner in the Philippines, has run out of the most sought-after soft drink at his store. He hurriedly gets on a call with the supplier, who confirms that the stock will be delivered soon.

But a small order such as his will take a week to get to his shop, and in that time, Tan would have lost several customers.

This is one of the most common pain points affecting small businesses in emerging markets. Smaller orders are given less priority because they have lower monetary value and because their delivery costs per unit are much higher.

Connected Freight, a startup incubated by oil and gas giant Shell, is looking to address these issues by developing a supply chain system that optimizes deliveries, saving time and costs for both suppliers and buyers.

Christina Gao, chief commercial officer for Connected Freight / Photo credit: Handout

Founded in 2018, Connected Freight brings retailers, suppliers, and third-party logistics (3PL) companies under one platform so that they can interact in real-time.

The Singapore-headquartered startup created an engine that optimizes delivery fleets and the routes they take, and it also provides deeper logistics and delivery support. In other words, clients can outsource the entire supply chain to Connected Freight through its partnerships with 3PL firms.

The platform is available as a subscription, and its clientele ranges from small- and medium-sized enterprises to larger businesses. At present, most of its customers are from the fast-moving consumer goods, F&B, and light manufacturing sectors, but it’s planning to venture into different segments in the future.

The company came out of Shell’s desire to start, incubate, and invest in startups in the mobility and energy sectors, says Christina Gao, chief commercial officer for Connected Freight. Backed by a large pool of customer data, Shell narrowed down its focus to transport route optimization as a major issue dogging businesses, and Connected Freight was subsequently created with Gao as one of its founders.

The exec, who looks after product development, commercial strategy, and expansion at the firm, says many Shell customers were having conversations about going digital in order to reduce costs.

“Can I improve the efficiency of my drivers? Can I improve the overall efficiency of my assets?” were common questions, Gao adds.

This was the problem statement that led to the development of “multi-supplier optimization” (MSO), Connected Freight’s core offering.

Shell’s advantage