By Kawal Preet
With millions of packages moving across its global network every day, FedEx sits at the leading edge of the industry and sees the latest trends as they emerge. Looking ahead to 2024, logistics providers will continue to operate at the intersection of the physical and digital world, giving businesses access to a range of possibilities to grow, regardless of their sector and location.
Here is a glimpse of what we see ahead in 2024.
1. Asia – Asia-Europe trade Will Continue to Drive the Growth of Supply Chains in Asia
Asia Pacific accounts for over 32% of the global air cargo market. One of the strongest drivers of growth in the region is the Asia-Europe Lane which the latest figures show is growing at 8.5% YoY. 1 This growth in Asia-Europe trade is being fostered by multilateral free trade agreements like RCEP, EVFTA, and CPTPP which at the moment is outperforming trans-Pacific Trade. Southeast Asia is an area to watch in 2024 after showing strong upward growth during 2023.
Asia Pacific businesses continue to diversify their supply chains following the pandemic and are using Southeast Asia as part of their strategy 2 driving higher value regional economic integration.
At FedEx, we are responding to meet these needs by expanding our network and services such as our new flight from Ho Chi Minh City in Vietnam to our APAC hub in Guangzhou, China as well as adding new facilities in Clark, Philippines, and Batam, Indonesia.
2. Data and Digital will Underscore how we Deliver
SMEs in Asia are increasingly investing in data and digital technologies to drive their businesses forward.
This trend is driven by the rapid advancement of technology and the growing recognition of the importance of digital transformation enabling them to streamline operations, enhance customer experiences, and make data-driven decisions.
At FedEx, we have always known the power of the data we have in our hands. 45 years ago our founder, Fred Smith, said that the information we hold about the package is just as important as the package itself. But it is only with today’s computing power, data analytics, predictive modelling, AI, and machine learning, that we can fully harness the power of this data, for the good of our company and our customers. The application of advanced technologies to unlock the power of data will become ever more firmly embedded in how logistics providers empower SMEs to drive their business growth.
3. Growth in Start-up Collaborations to Accelerate Innovation
Asia has created a vibrant ecosystem for start-ups and an environment that fosters innovation by bringing together start-ups, industry experts, investors, and research institutions to lead the development of groundbreaking solutions and technologies.
With tailored programs, industry-specific collaborations, regional events, and government support, the pace of innovation in Asia is set to accelerate further in 2024.
In addition to setting up our teams to drive innovation, FedEx also recognizes that partnerships allow us to make big leaps forward fast. In 2023 we launched the FedEx
Innovation Lab to make early-stage investments in rising tech start-ups. Our first investment was in a leader in enterprise AI solutions. We’re now working with them to develop new solutions that will help us improve efficiency. We continue to look for more partnerships with companies like this to help us both transform and develop differentiated services for our customers.
4. Sustainable Logistics Becomes a Norm
Operating more sustainably is both a business imperative and a business opportunity to leverage. Customers now expect and demand sustainability in the service providers they are engaging with.
Insights customers can get better visibility of emissions within their supply chains to support reporting and future planning. This helps them decide how to meet their own customers’ expectations and drive their own business and sustainability efforts forward.
5. Increased integration between E-commerce and Logistics
Finding new customers in international markets is a smart approach for SMEs wanting to drive revenue growth and digital channels lower the barriers to market entry. Such ‘born global’ e-tailers and their customers demand seamless logistics solutions which is why we will continue to see a deepening of integration with logistics within the e-commerce ecosystem.
At FedEx, we’re providing the local market insights e-tailers need to build their business strategy. We are also making it easier for e-tailers to access our services no matter which e-commerce platform they are operating from, and providing solutions that make order fulfillment, last-mile delivery, and returns more efficient.
For people receiving deliveries, it’s all about convenience and reliability. We offer options for where to deliver so there’s always somewhere safe to send to, even if you’re not at home.
By collaborating with retail outlets and smart locker providers we’ve now created a network of 260,000 self-pick-up locations across Asia Pacific in the form of smart lockers and retail outlets.
This network will continue to expand. Convenience and assurance also come at consumers’ fingertips today – you can change delivery location even when the shipment is on its way and receive Picture proof of delivery.
Kawal Preet is president of Asia Pacific, Middle East, and Africa, FedEx Express