Cambodia’s logistics infrastructure is gradually improving with the ongoing construction of new roads, port expansions and rail improvements. However, inefficient procedures and limited last mile delivery capacity remain, potentially leaving the Kingdom unprepared for a surge in e-commerce that has already taken hold in the region.
Sydney-headquartered Yojee is looking to improve the Kingdom’s logistics framework through a technological based approach that adopts innovation to disrupt the existing market.
Yojee does not own any vehicles or warehouses. Instead, it relies on technology-focused features to create a “crowdsourced” platform for delivering goods by combining the infrastructure and delivery assets of multiple firms into a much larger network.
The platform is backed by an artificial intelligence (AI) system that automatically assigns delivery jobs to drivers and calculates optimised routes for picking up and delivering goods.
Yojee is also tapping into another emerging technology, blockchain, which enables customers to track their package delivery as well as maintain a record of transactions and past deliveries, while keeping personal information secure.
According to Yojee CEO Ed Clarke, the goal of the platform is to fill unused space in the network’s vehicles and optimise delivery efficiency through an automated process, requiring no human dispatcher, ultimately reducing costs for firms.
Last month, the company announced it was set to begin operating in Cambodia after partnering with Post Media, the parent company of The Phnom Penh Post and Post Khmer.
According to Clarke, the partnership will allow both parties to provide same day and next day delivery capabilities in Cambodia, by combining Yojee’s software with Post Media’s physical delivery infrastructure.
“Yojee takes this huge information asymmetry that exists in Cambodian logistics and uses machine learning and artificial intelligence to create a seamless network for both senders and logistics companies to participate in, opening opportunities up for cross border movements and also more efficient business-to-business, business-to-consumer and consumer-to-consumer movements,” he said.
Though Cambodia is still lacking in solid logistics infrastructure, there is an opportunity for companies like Yojee to disrupt traditional transportation methods through technological innovation, Clarke explained.
“I think it’s really exciting to come into a market that is operating but not anywhere near an optimal level,” he said.
“I think we have a really big opportunity to define to the market what logistics should be, and provide confidence to businesses to take that online to business and consumer channels, which provides access of more goods to more people.”
Overall, Cambodia’s logistics capacity is improving - with the country receiving a better rank of 73 out of 160 countries in last year’s Logistics Performance Index (LPI), released annually by the World Bank. The new ranking saw Cambodia climb up from 83 in 2015.
However, the Kingdom scored poorly in the infrastructure category, with a rank of 99, while in the logistics quality and competence category, the country scored 89.
Clarke noted that Yojee’s goal was to become a major logistics player in Cambodia, following an “uber like user experience” which he hopes will allow the company to overcome local inefficiencies.
Digitally focused logistics are already disrupting traditional delivery methods across the world.
Though technological innovation remains limited in Cambodia, the rapid growth of innovative logistics platforms could revolutionise logistics worldwide, according to a report released last year by the World Economic Forum (WEF).
“Digital platforms will become increasingly important in the logistics industry, allowing small companies to have a global reach and compete with the sector’s established giants,” the report noted.
“Our analysis indicates that digitalization in logistics could unlock $1.5 trillion of value for logistics players and a further $2.4 trillion worth of societal benefits over the next decade (to 2025).”
The report found that logistic inefficiencies are creating heavy burdens for companies that operate physical delivery capacity. The solution it says are digitally based solutions, which pose a serious risk to established logistics players, such as trucking companies, who globally risk losing $310 billion in operating profits to Yojee type “crowdsourced” solutions, the report estimated.
“With the logistics industry suffering from some very significant inefficiencies – for instance, 50 percent of trucks travel empty on their return journey after making a delivery... crowdsourcing platforms – the ‘Uber’ of logistics – can be a game changer,” it said.