Digital Transformation in the Philippines Logistics Industry: Why & How?

Logi-Sys gaining popularity among Philippines forwarders
Amit Maheshwari, Softlink Global CEO

According to recent research by Ken Research, the Philippines logistics market is forecasted to grow to PHP1160 Bn by 2027. The Philippine logistics sector is expanding rapidly, owing primarily to the surge in demand from e-commerce and increased investment in infrastructure by the government.

The pandemic augmented e-commerce activities and accelerated online shopping in the country. Other major industries contributing to the revenue of the logistics market in the Philippines include Ecommerce, F&B, Manufacturing, Electronics, Automotive, Pharma, and more.

Increased use of cutting-edge technology, such as supply chain automation and digital platforms, to improve efficiency is another growth driving factor Philippines logistics market. The logistics industry is strongly associated with various industrial activities and international trade. As an archipelago, the Philippines rely mostly on maritime transport to move goods for the domestic and international markets. And land transport is used to move goods to and from ports and within each island.

Under the ‘Build, Build, Build’ program, the Philippines government is currently emphasizing building several infrastructure projects, including road transport, seaports, airports, railways, and bridges. All the initiative by the government and the eCommerce market growth shows a huge potential for the supply chain and logistics sector. The country is still 80% not digitalized, but the pandemic has pushed to accelerate the importance of digitalization, especially in the logistics and supply chain industry.

By adopting digitalization, logistics and supply chain companies can seize more opportunities presented by the Philippines’ growing economic market, particularly in e-commerce. If leveraged fully, digital transformation can unlock the total Digital Logistics revenue growth by 21.5% from 2022 to 2029, reaching nearly USD 99.16 Bn. While a range of policies is already introduced to accelerate digital transformation such as the “Digital Rise Program”, there is scope for the Philippines logistics market to consider fully capturing its digital opportunity. The industry should further emphasize enhancing digital skills training and education, accelerate digital adoption and innovation and promote digital trade opportunities.

The following are the few driving forces behind digitalization that can help the Philippines’ logistics industry to improve productivity, meet customer requirements, and keep up with the competition.

Digital transformation – Implementing a cloud-based solution can deliver greater operating efficiencies, and track the delivery of goods in real-time, enabling them to identify areas for improvement and increase productivity. In addition, it allows for optimizing travel routes, anticipating delays, and raising the flag in the event of an accident. It provides various features like route optimization, fleet tracking, analytical reports, analyzing metrics, and measuring KPIs that can dramatically cut costs and time while maximizing revenue, and productivity and enhancing process effectiveness.

Customer-centric solutions – The logistics industry is mostly dependent on customer relationships and strengthening customer relationships and creating a loyal clientele is the basis to stand out from competitors. One of the main ways to increase customer service is to ensure a smooth end-end customer journey by digitalizing the entire process using digital ERP tools like Logi-Sys that offer quick quotes and bookings directly.

The single platform provides all data from a single database, along with a customer portal which allows real-time visibility and data collection to understand what exactly is required by the clients. The CRM module provided by the Logi-Sys freight software ensures a smooth and unified operating process, while the real-time data helps analyze operations and increase cost efficiency.

Automation of procedures – The logistics industry involves a lot of documentation processes. Engaging in repetitive tasks and manual data entry is not only time-consuming but also involves a high risk of inaccuracy. Data entry automation using cloud-based logistics software will eliminate the manual data and ensure 99% accuracy and data security while reducing employee workloads.

Automation of data entry using cloud software allows extracting data and entering it into the right fields, thus helping in saving time and money while increasing efficiency and revenue.

Automating processes will allow employees to focus on value-added tasks to make proactive decisions to increase ROI.

Going digital will further provide transparency regarding order status, shorten lead times, and potentially cut down the customs clearance process by up to 80%, taking only 3–5 business days. By transforming digitally, the logistics and supply chain sector can seize more opportunities presented by the Philippine’s growing commercial activity, particularly in e-commerce.

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