As Vietnam’s penchant for ecommerce grows, keep an eye on these logistics startups

Ho Chi Minh City / Photo credit: duha127 / 123RF

Vietnam has the fastest-growing appetite for online shopping in Southeast Asia. According to research from Google and Temasek, gross merchandise volume (GMV) in the country’s ecommerce sector is expected to increase by 43% between 2015 and 2025 – more than any other country in the region. Online GMV contributes 4% of the country’s gross domestic product (GDP), also a higher proportion than in any other Southeast Asian market.

Another indication of Vietnam’s thirst for ecommerce is the amount of traffic its online stores receive. Three Vietnam-only marketplaces – Sendo, Thegioididong, and Tiki – made it into iPrice’s list of the top 10 most visited ecommerce sites in Southeast Asia.

As Vietnamese consumers and businesses make an ever greater number of purchases online, demand for delivery, shipping, and fulfillment solutions also rises.

The problem is that like its neighbors, Vietnam hasn’t had the best track record in logistics.

See: Thailand wants to be Southeast Asia’s logistics hub. These startups are on the case

Prime Minister Nguyen Xuan Phuc said in April last year that costs associated with logistics amount to an eye-watering 21% of the country’s GDP. This reflects the situation across Southeast Asia, where a combination of challenging geography – archipelagos, jungles, and mountain ranges – and often-inadequate infrastructure make the movement of goods an expensive business.

Nevertheless, Vietnam has been among the most-improved economies globally in terms of logistics capabilities over the past few years. Between 2016 and 2018, it leapt from 64th to 39th place in the World Bank’s Logistics Performance Index, putting it behind only Singapore (seventh) and Thailand (32nd) in the region.

But there’s still plenty to be done, and startups are leading the charge. Below, we take a look at some of the Vietnamese and regional tech firms that are trying to overhaul the country’s logistics scene. We’ve divided them broadly into three categories: marketplaces that link customers with hauliers, software providers offering logistics management platforms, and last-mile delivery services.

Marketplaces

EcoTruck

Vietnam has no shortage of trucks, drivers, and haulage firms. The problem for customers who have freight to move is that securing such services is far from being an efficient process. They need to contact hauliers one by one to find out who can deliver their load on time, and negotiate prices.

EcoTruck wants to simplify things by using a marketplace model. It acts as a middleman connecting enterprise customers with a variety of hauliers, allowing businesses to take advantage of lulls in demand. At the same time, truckers are able to optimize their loads, using more of the available space in their vehicles to make the most of each journey.

Founded in 2017, the startup raised US$1.7 million in pre-series A funding in September last year from South Korean investors FuturePlay and Nextrans, plus US player Access Ventures and local firm Viet Capital Ventures. This followed an earlier US$300,000 seed round.

Logivan

Software

Last mile

Other players