Flash Express to wade into red ocean for shipments

Flash Express to wade into red ocean for shipments

Flash Express Co, a Thai-Chinese logistics provider, has taken the first step towards providing express parcel delivery in Thailand and Asean with an investment of 2.5 billion baht scheduled for 2018-2022. The move comes as the logistics and shipment industry has become a red ocean for new operators.

A budget of 300 million baht has already been spent on expansion in 30 provinces in Thailand, mainly in the central region of the country.

Chief executive Komsan Saelee said the company will gradually inject the 2.5 billion baht over five years, with the first phase of investment focusing on its expansion network, covering every province in Thailand by 2018.

The second phase is set to strengthen express delivery this year via the company's digital platform, as well as through the installation of a mixed-mail and parcel sorting system at Flash Express's logistics centre in Sai Mai district, Bangkok.

The third phase of expansion will cover Laos, Malaysia and Myanmar.

"We have a strong business position for providing free at-home pick-up service for senders, even if they only have one parcel. I think there is no other player that can provide this service as most operators will collect a fee," he said.

"We can support this service in 30 provinces and will expand nationwide this year."

Mr Komsan said Flash Express also offers a competitive price for its express service, starting at 45 baht per piece, although price is dependent on size and weight.

He said the country's logistics and shipment industry is worth 700 billion baht annually thanks to the fast growth of the local e-commerce industry, with surging demand for both express and standard delivery.

"Express shipments have an annual value of 25 billion baht and Flash Express looks to focus on this segment," said Mr Komsan.

But express shipments remain a red ocean, dominated by state-owned Thailand Post, which controls 60-70% of the market and delivers 400,000 items per day.

Other players are Hong Kong's Kerry Express and Thailand's Nim Express, which control 5-10% each.

He said Flash Express has set the ambitious target of taking 10% of the market and generating 4 billion baht in annual revenue by 2022. The company expects revenue of 200 million baht in 2018 and 1 billion baht by 2020.

"We deliver 200-300 items per day and aim to ship 5,000 pieces by 2018," said Mr Komsan.

Founded last September, Flash Express has registered capital of 5 million baht. Thai shareholders owns about 70% while Chinese investors control the rest.

The company was established by bringing together several executives from DHL, TNT, Alipay, Alibaba, Baidu, UFIDA, Jingdong, and SF Express.

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