Important themes in 2025:
1. Logistics gravity moving north in ASEAN from Singapore towards Thailand; Burma will become an important gateway to ASEAN (Dawei Deep Sea Port), Thailand will be become an important logistics centre, linking to Burma, Malaysia & Singapore, Vietnam and via Laos to China.
2. A Trans ASEAN Transport Network (TATN) will be established; A highly integrated network over ASEAN will be rolled out, covering multiple modes of transport: road, rail, water, air and pipeline.
3. Rise of MEGA Distribution Centres (DC) in ASEAN; Over the coming years, there will be a consolidation of country DCs into regional DCs. MEGA DCs will be located along TATN (with sizes from 150,000 – 300,000 sq. meter). By 2025 80% of our current DCs we have today will be obsolete! These MEGA DCs will be using 100% solar energy to meet their energy demands and catching rain water for their water requirements.
4. Consolidation of freight forwarders and transportation companies in ASEAN; ASEAN countries are characterised by a very high number of small freight forwarders and transportation companies. Many of these will disappear (as they are not competitive) or are bought over by other ASEAN countries that want to expand to another ASEAN country.
5. Specialisation of local and regional third party logistics service providers (3PL); Local and regional 3PLs will more and more focusing on those logistics activities where there is a comparative advantage and/or strong existing local industry cluster foundations (focus on those logistics services meeting the local requirements of an industrial cluster present).
6. Local freight forwarding, transportation and warehousing companies will move up the value chain towards specialised logistics service providers, 3PLs or fourth party logistics service providers (4PL).
7. Adoption by the logistics industry of advanced ICT systems. Over the coming decade, the packaging density – the number of order lines per cubic meter – will increase by factor 5-10. It will be the efficient handling of goods that matters! Adopting professional order management, supply chain planning, inventory management and simulation software & systems by the logistics industry will be required if you want to be active in this field of business!
For logistics service providers in ASEAN it would be key to:
i. Assess the fitness of your organisation: your current logistics performance in terms of lead-times, variation and waste;
ii. Focus your business model and establish professionalism in the operations model;
iii. Support your (new) focus with advanced ICT systems.
About the Author: Dr. Marco Tieman is the CEO of LBB International, a logistics consulting & research firm, and is Adjunct Professor with Universiti Tun Abdul Razak and Universiti Malaysia Pahang. For more information, visit LBB International.
© 2015 LBB International
