How digital logistics is changing the ecommerce industry

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The idea of starting an electronics store online first crossed Kim Lato’s mind in 2006. Still a student at Manila’s De La Salle University at that time, Lato saw a gap in the local market.

“Filipinos are gadget enthusiasts and they want to get the latest gadgets at affordable prices. I saw a great opportunity to address that, but I had limited capital to start a retail business,” she recalls.

Realizing that now-defunct Multiply was “the social media platform to be a part of,” she set up the first iteration of Kimstore there.

Lato ran everything from her family home, relying on traditional logistics. Her store’s operations were heavily reliant on manual work, which “sacrificed its efficiency.”

Traditional vs digital

Kimstore managed customers’ orders through text messages and calls, while payments were carried out over the counter via manually written receipts. Waybills – documents that contain shipment details and instructions – were also handwritten, and orders were dispatched by staff who dropped off packages at nearby pick-up locations.

These processes had loopholes that were exploited to con customers. For example, some scammers pretended to be Kimstore employees and collected payment from unsuspecting buyers, who never got their brand-new devices. As a result, the e-tailer’s reputation took a hit among users.

To address inefficiencies related to having multiple players in the delivery chain, Lato turned to digital logistics provider QuadX. Using the company’s solutions allowed Kimstore to receive orders faster by routing them through its website. Waybills are now digitally printed and parcels are picked up for dispatching by QuadX staff.

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Lato says this assures customers that “their hard-earned money is collected by a reputable representative from QuadX” and prevents scams. The digitized processes helped Kimstore meet customer demands efficiently without spending beyond its means.

“We’re able to process more orders in a shorter amount of time and with less manpower, translating to lower operating costs,” she explains. “We are able to pass on our overall savings to customers by offering the latest in tech at price points they’ll love.”

Using data to keep up with processes

Advantages aside, one of the key challenges in digitization is managing how products move through networks that consist of various personnel, assets, and partners across countries. Data generation plays a big role in ensuring that deliveries are sent to the right customers on time, according to Jojo Añonuevo, chief innovation officer at QuadX.

“Real-time information on the location of parcels or the flow of goods is critical and requires a focus on data science and analytics to enable efficiency,” observes Añonuevo. That’s because delivery requirements can shift from several days to a day, or even hours and minutes.

Real-time data also lets businesses and their customers monitor orders and deliveries with ease.

“On our end, we can track orders that have been completed, paid, and canceled,” says Kimstore’s Lato. “Then customers are able to track where their packages are before they reach their doorsteps.”

Hopes for the future

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While adopting digital processes for logistics has boosted the efficiency of ecommerce, there are other possibilities to explore.

Lato cites the potential of smart lockers, or electronic devices that are designed to accept and manage packages from senders, giving recipients the flexibility to pick up orders at their convenience. And since these lockers can only be accessed by using a unique passcode, customers don’t have to worry about their items being stolen or misplaced.

While smart lockers are gaining ground in the US, Europe, and parts of Asia, the concept has yet to reach the Philippines, Lato says.

Moving forward, Lato’s focus is on improving how Kimstore reaches its customers in key cities, such as providing same-day, cash-on-delivery services. She notes that customers – especially those who don’t want to travel to pick-up locations – often ask if Kimstore has this option.

In the digital age, speedy service is what puts businesses on top of customers’ minds. “They are a tap away from ordering the latest gadgets, and they want to get it fast,” she points out.

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QuadX’s Añonuevo thinks that the growing demand for such services will “further drive the need for granularity to identify a house or building with a unique code.” In fact, he says the company is collaborating with several partners to overhaul the Philippines’ four-digit zip code system, which “needs a major upgrade.”

For QuadX, the future of digital logistics is wide open. “We are constantly curious. We prototype, test, and build stuff continuously, so you can expect to see a lot more of our services in the market,” shares Mia Bulatao, chief commercial officer of QuadX.

“Expect us to grow geographically, too, as we expand our service beyond the Philippines to Southeast Asia. And expect us to create livelihood opportunities in areas we serve,” she says.

As the Philippines’ first customer-centric digital logistics company, QuadX is dedicated to helping Filipino entrepreneurs by providing simple and seamless solutions.

Visit QuadX’s website to learn more about integrating digital logistics processes into ecommerce business.