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The Singapore freight & logistics market is expected to grow at a CAGR of 8% during the 2022-2027 period. This growth is primarily led by the strategic position of Singapore that makes the country a transshipment hub and connects it to major regions, enabling global trade and eCommerce growth.
While Singapore’s logistics and freight network are known for their competitive advantages, businesses are still unable to manage last-mile deliveries efficiently due to a lack of technology integration. This leads to delayed deliveries and high logistics costs. According to McKinsey & Company, the costs associated with last-mile deliveries account for over 50% of the shipping costs.
So, to cut down last-mile delivery costs, deliver shipments on time, meet customer needs and improve overall efficiency, smart and efficient end-to-freight management software in Singapore is necessary.
Below, we talk about the current landscape of freight management software in Singapore, the challenges it can help businesses solve, and useful tips for choosing the right freight management software that ensures growth.
Although Singapore is small, it has a resilient, efficient, and diverse freight and logistics network. Also, Singapore has a dense marine and road transportation network and a strategic location. Every Southeast Asian country is within a 6-hour radius of Singapore, offering easy access to growing markets and consumers.
In addition to the strategic location, the rising eCommerce, digitization, and technology adoption are also boosting Singapore’s freight and logistics industry. However, as the industry grows, the burden on last-mile deliveries will increase, which, unfortunately, lacks technology integration and is highly inefficient. Shipments often rest in the warehouses on the last leg incurring higher costs to the businesses because of that.
Hence, businesses are increasingly seeking technologically advanced freight management solutions to tackle this rising demand and ensure timely deliveries without violating the bottom lines.
Let’s now discuss other factors that are driving the demand for freight management software in Singapore.
Singapore offers several advantages for both domestic and international companies, such as its strategic geographical position (2nd most connected country in the world), extremely stable economy, high government revenue, and no foreign debt.
Such advantages attract international players and foreign direct investments and boost imports and exports, fueling global trade activities. And with the rising global trade, the need for smart, end-to-end freight management is also increasing to ensure the smooth movement of shipments in and out of the country.
While Singapore is a small country and has no natural resources of its own, it has still managed to become one of the most stable economies. This is mainly because of its strategic geographical position and trade agreements with other countries.
With trade agreements, Singapore and other countries can access tariff-free goods, which significantly reduces logistics costs while promoting the freight and logistics industry. Over the years, Singapore has developed an extensive network of 27 FTAs. And this number will gradually increase, promoting the need for more efficient freight management software in Singapore to ensure the smooth movement of goods.
Transport connectivity in Singapore is seamless and vast. The dense marine and road networks make Singapore a multimodal transshipment hub that has intermodal connectivity between one of the busiest airports and seaports in the world. Changi International, the busiest airport in Singapore, is located just an hour’s drive from the PSA terminals, the world’s 2nd largest transshipment hub, and container port.
This level of connectivity allows seamless travel of freight from the source to the destination and attracts international logistics providers to Singapore, boosting the growth of the freight and logistics industry. And as more companies are set up, more efficient freight management software in Singapore will be required to ensure a seamless flow of goods.
As eCommerce is rising and people are leaning towards online shipping, the rate of products returned is also increasing, which is boosting the reverse logistics segment of the logistics industry.
For instance, as opposed to traditional shopping, 30% of total products sold online are returned. And businesses need to facilitate returns without charging customers anything to build trust and gain a competitive edge over customers.
However, as online shopping increases further, it’ll be hard for businesses to manage the burden of reverse logistics without a smart and efficient system in place that helps them significantly reduce the logistics cost to facilitate free returns.
With the increasing internet penetration and a mindset change, consumers are now moving towards online shopping, which is boosting the eCommerce industry. Also, Singapore’s Minster of Trade and Industry launched a strategy for transforming the country into a regional & global eCommerce hub in 2021.
A key initiative is the development of 5G infrastructure, which will serve as the backbone of Singapore’s digital economy. The development of 5G will help strengthen the country’s digital connectivity, payment systems, data analytics, and the ability to manage hundreds of thousands of eCommerce orders. And this will further help boost the need for freight management software to manage a high volume of orders seamlessly.
Singapore, being a small nation lacking natural resources, imports a lot of goods. For instance, in 2021, the imports jumped to $609.27 billion from $517.98 billion in 2020.
The exports follow a similar pattern. Singapore is one of the most stable economies in work and acts as a major logistics, distribution, and financial hub and offers friendly laws & regulations. This attracts businesses to set up their manufacturing units in Singapore, boosting exports. No wonder the exports increased to $733.77 billion in 2021 from $627.46 billion in 2020.
And this increase in imports and exports is a major driver of demand for smart, reliable, flexible, and scalable freight management software in Singapore. Because as exports and imports increase, more goods will have to be shipped efficiently, which is impossible with end-to-end freight management software.
To choose the best freight management software in Singapore, businesses need to look out for some distinct features that help solve the challenges specific to the Singaporean freight and logistics sector. Here are some of them:
One of the most common challenges faced by logistics businesses is inefficiencies across the supply chain, especially in last-mile delivery. While the government is promoting technology development across the country, the majority of businesses haven’t yet opted for smart freight management solutions, leading to operational inefficiencies and, thus, high logistics costs and delayed deliveries.
The freight management software must offer smart features such as automated freight procurement, quotation management, real-time tracking, etc., that help businesses have more control over their shipments allowing them to plan, assign, and monitor consignments and vehicles smartly.
Also, features such as smart driver allocation could help businesses choose the ideal driver for an order ensuring faster last-mile deliveries.
Workforce and vehicles are the two most important assets for any logistics company. However, to be able to deliver orders on time, seamlessly, and at low cost, both these assets must be optimized or utilized effectively. But, as there’s a lack of visibility in Singapore’s supply chain, it becomes impossible to keep an eye on the assets, let alone them.
Reliable smart management software in Singapore must offer smart route planning. Using smart route planning, businesses can have real-time visibility of their assets, making it easy to monitor, manage, track and optimize the assets.
Businesses can make sure that the drivers are allocated a delivery based on their knowledge of the area, experience, and language they’re comfortable with, and vehicles are chosen based on the type of shipment, vehicle capacity, and other factors. This way, assets can be optimized effectively, ensuring timely deliveries and maximizing profits for businesses.
When all aspects of logistics operations rely on human factors, it can be quite hard for businesses to manage and monitor each one of them, leading to missed SLAs. However, with smart and integrated end-to-end management, businesses can easily manage, monitor, and track all the processes or operations through a single integrated dashboard.
This will not only save time but will significantly boost productivity as businesses will be able to have a hawk’s eye view over all the operations and deal with any bottlenecks that might arise.
When vehicles for shipping goods are chosen manually, the likeliness of underutilization of the vehicle capacity increases. Because, often, manual labor doesn’t consider enough factors to ensure the right vehicle is chosen, especially when there are too many orders to be fulfilled. Also, when the route is planned manually, events such as congestion or roadblocks are usually ignored, which often leads to extra miles driven. And this significantly adds to the logistics cost and also impacts SLAs.
However, if businesses choose freight management software that offers route planning, these issues can be dealt with. With smart route planning, businesses can consider numerous constraints such as vehicle type, shipment type, vehicle capacity, shipment volume, terrain, etc., and choose the most optimized route from source to destination. And if something happens (congestion or any other roadblock) mid-way, the platform automatically re-routes the path minimizing the risk of missed SLAs. This way, businesses can ensure complete vehicle capacity utilization.
A lack of unified collaboration can lead to a disconnect among the stakeholders, which impacts the delivery time, delivery cost, and, eventually, the customer experience. Therefore, unified collaboration is a must-have that every business should look for while investing in any freight management software in Singapore.
With unified collaboration, businesses can achieve transparency and ensure all the stakeholders are able to communicate & collaborate with each other and are on the same page, ensuring seamless operations.
Because of the lack of a centralized system that connects all stakeholders, there’s also a lack of transparency and, thus, trust. Businesses cannot accurately monitor their vehicles and drivers, and customers cannot track their orders because of poor transparency across the supply chain.
However, a freight management software in Singapore that offers real-time tracking of shipments and allows businesses to check the driver’s exact location and shipment status can be a game changer. Businesses can manage and monitor all the operations, including their assets, from a single dashboard and can also allow customers to track their shipment status in real time, which will help build trust.
Allocating drivers, assigning vehicles, procuring freight, and sending RFQs are some of the tasks that rely on human factors in logistics companies leading to operational inefficiencies, faulty route optimization, underutilization of assets, high logistics cost, and delayed deliveries.
A freight management software that helps digitize and automate the aforementioned and other tasks reducing the reliance on manual elements. Automating these tasks would substantially reduce the error margin, improve operational efficiency, reduce logistics costs and deliver shipments on time.
The freight and logistics industry is quite unpredictable. There can be last-minute orders, cancellations, or mid-way route changes. However, as most businesses either rely on manual elements or use legacy software with static functionalities, they cannot deal with such unpredictable changes, leading to poor customer experience, high logistics costs, and missed SLAs.
Therefore, businesses must look for freight management software in Singapore with dynamic functionalities such as dynamic route planning. This way, any last-minute orders or cancellations and be effectively dealt with dynamically. Also, the vehicle can be dynamically routed if a roadblock appears in the shipment’s route. This way, no matter what happens, businesses can always ensure minimum shipment delay and logistics costs.
Shipsy is one of its kind, end-to-end freight management and orchestration platform that helps logistics companies run their business seamlessly.
With Shipsy’s integrated interface, businesses can procure freight, track their shipments in real-time, send RFQs to multiple bidders and manage other logistics operations from a single, easy-to-use dashboard.
Collaboration and transparency are also not a problem as Shipsy offers unified collaboration for all the stakeholders ensuring they’re all on the same page and have 100% visibility over the operations.
In addition, businesses can utilize their assets to the fullest using smart route optimization and choose the best possible route to reduce fuel expenditure, minimize carbon emissions, and ensure faster deliveries. Also, Shipsy allows businesses to automate all tasks that would otherwise rely on humans, boosting productivity, reducing error margin and logistics costs, and ensuring faster deliveries.
Along with the above benefits, Shipsy can also help businesses:
For a deeper dive into our services and to understand how we can help your business, book a custom demo now!
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