Nowadays, most people are accustomed to booking hotels and flights on price comparison websites. In recent times, similar platforms have been launched in the logistics industry. Using hotel price comparison and booking platforms as the blueprint, Hong Kong logistics company OYM Logistics has developed the largest online matching platform in the industry, which enables manufacturers to save time and resources. At present, more than 8,600 warehousing division enterprises have joined the platform. For the next step, the company is planning to tap into the Belt and Road markets, and to assist the industry to seize opportunities in the Guangdong-Hong Kong-Macao Bay Area (Greater Bay Area) for entering the international market.

Edmond Fung, Chief Executive Officer of OYM Logistics Alliance Platform, remarks that there are insufficient resources for operating systems, sales and marketing in the traditional logistics industry: “The industry is still using Excel for order input that causes a great deal of disorganisation. In addition, there are no sales or marketing teams.” As online retail has been a popular trend, Fung foresaw the opportunities in this aspect and founded the OYM Logistics Alliance in 2012. The platform’s mission is to gather logistics and warehouse providers from around the world, building an integrated price comparison platform for the logistics industry.

“The platform aims to assist sales and marketing for industry players.” He pinpoints that the emergence of online travel platforms is undermining the room for survival for traditional travel agencies. However, the platform sets out to help traditional logistics providers to consolidate their business networks. He states that the platform is free and open to all companies in the industry at present. To register, logistics providers have to submit information including company profile, the GPS map of the company, business license, photos of warehouses and description. After registration is completed, the platform conducts business rating of each company based on the level of adequacy of information provided. He mentions that in the early phase, the information submitted by providers tended to be incomplete. To ensure accurate business matching through the system, however, all merchants are required to submit complete company information.

On the other hand, the platform seeks to facilitate the manufacturers’ search for suitable logistics and warehousing service providers. After the manufacturers have completed the questionnaire on service needs on the platform, the system utilises AI technology to conduct filtering and matching, in order to narrow down the choices of the most suitable warehousing and logistics service providers.

Upon successful matching, the client’s information is sent to the matched logistics providers through WeChat, allowing them to submit their quotations directly to the client. “Our team in Guangzhou also coaches member enterprises how to shoot warehouse photos. For instance, we would suggest that they take photos of the roads outside the warehouse. That is because we have received feedback from merchants of expensive red wine, who noted that an overtly uneven road surface would cause damage to the wine.” In addition, there are certain requirements for company size for enterprises that wish to join the platform. For instance, they must have a total warehousing space of at least 50,000 square feet.

The country is actively promoting domestic demand. Fung states that the logistics industry has shifted from import shipping in the past to supplies for domestic demand at present, which has led to strong growth in logistics for domestic demand. Meanwhile, e-commerce has been on the rise in the mainland, and home delivery is a key strategy to boost market penetration among companies. Tuck shops, convenient stores and smart lockers in residential areas have all become pick-up points for online purchases. Therefore, the platform was launched in the mainland, and mainland companies make up of 95% of its current membership.

He states that most orders made via the platform at this stage are small orders for logistics services. While the transaction amount of each order is not high, it is always a rush order and it is confirmed relatively quickly. “Some mainland companies focus on this kind of small orders in order to increase their marginal profits.” He points out that the mainland logistics industry is more liberal in its mind-set, and more receptive to online sales platforms. In fact, it is the prominent trend for services to be transposed to the internet. This includes the integration of the platform and the cloud warehouse management system (E-WMS) to propel the business forward.

At present, around 250 quotations are induced by the platform every week. In the future, the platform will charge commissions and collect transaction data. Fung reveals that the company has invested HKD30 million into the platform as its operating funds. While the platform is still in the incubation page and has not yet achieved breakeven, he believes it has strong potential for growth. As the platform has received capital injection from investors, the company plans to carry out another round of financing for future development. It will include soliciting overseas providers to join the platform, with a view to bringing it to the international market.

In recent years, the “Belt and Road” initiative introduced by the mainland and the Guangdong-Hong Kong-Macao Bay Area Development plan have attracted the attention of the logistics industry. At the Asian Logistics and Maritime Conference (ALMC) organised by the Hong Kong Trade Development Council (HKTDC) last year, Fung focused on emerging “Belt and Road” markets. He signed cooperation agreements with industry organisations from Southeast Asia such as Vietnam, in a bid to attract more logistics providers along the “Belt and Road” to use the platform.

He thinks the “Belt and Road” markets are still at the starting phase, while the Greater Bay Area is set to take off. “In the past, Hong Kong logistics enterprises took on the role of product importers in the Greater Bay Area. Now they assist enterprises in the area to launch their products overseas.” He adds that at present, there are more than 1,000 enterprises from the Greater Bay Area that have joined the platform. The company is planning to collaborate with the Hong Kong Logistics Association on organising industry delegations to the Bay Area to search for business opportunities.

The company takes part in the Asian Logistics and Maritime Conference every year. Fung notes that the event is the only seminal logistics event in Hong Kong and it fosters industry cohesion, for which it warrants support from industry peers. Through the conference, the company is able to introduce the platform to overseas industry players and draws the attention of local and international media. “This has enhanced the image of the platform as well as our industry peers’ confidence in using it.” The company will participate in the conference again this year.

Edmond Fung, Chief Executive Officer of OYM Logistics Alliance Platform (left) and Anthony Wong, the alliance’s International Project Director (right) say that the company aims to solicit overseas logistics providers to join the platform with a view to bringing it to the international market.