Speech
DPM Tharman Shanmugaratnam at the Opening Ceremony of Singapore Post Regional eCommerce Logistics Hub
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SM Tharman Shanmugaratnam
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Economy
Jobs and productivity
1 November 2016
Speech by DPM and Coordinating Minister for Economic and Social Policies, Tharman Shanmugaratnam, at the Opening Ceremony of the Singapore Post Regional eCommerce Logistics Hub on 1 November 2016.
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Mr Simon Israel, Chairman, Singapore Post,
Distinguished Guests,
Ladies and Gentlemen,
Introduction
It gives me great pleasure to join you today at the opening ceremony of Singapore Post’s Regional eCommerce Logistics Hub.
The Hub marks a significant milestone in SingPost’s transformation into a leading eCommerce logistics company in Asia.
SingPost’s Transformation into Leveraging eCommerce
It’s been an impressive journey. The rise of the digital economy had disrupted SingPost’s traditional business in postal services. The company responded by harnessing digitisation itself, to reinvent itself in eCommerce logistics. By last year, SingPost was managing S$5 billion worth of eCommerce merchandise.
This hub will play a critical role. Its intensive deployment of technology ensures fast and accurate processing and sorting of eCommerce parcels. It will enable SingPost to continue being a strong partner to merchants and platforms in the rapidly-growing eCommerce market.
Singapore’s Ambitions for a World-Class Urban Logistics System
SingPost’s transformation is a good example of the journey our wider domestic, or urban, logistics sector will have to undergo.
We have an efficient and competitive external logistics sector, anchored in Changi and the port.
However, our domestic logistics sector has great room for productivity improvements.
It also impacts the liveability of the city.
We know how things could be done differently – much more efficiently, at lower costs overall, and with less traffic congestion caused by goods vehicles. Cities like Tokyo, London and Zurich are exploring innovative solutions to achieve this.
We must therefore transform domestic logistics - to raise productivity and job quality, and reduce traffic congestion. It will mean leveraging on technology and new business models in logistics. We will also aim to cap the growth of jobs such as drivers and warehouse workers, while redesigning them into higher skilled jobs. There is no choice. We have many local workers who will retire from the sector in the next 10-15 years, and a shortage of Singaporeans to fill up the same jobs.We also aim to reduce delivery vehicles during peak-hour by 20-30% within a decade.
We will be implementing several strategies to achieve these objectives.
First, we will accelerate the in-mall consolidation of deliveries.
In April this year, I announced two pilots for in-mall distribution at Tampines and Bedok Mall. These pilots involve a single in-mall operator which receives and consolidates deliveries, and enables trucks to turn-around quickly. The pilots are progressing well.
The average parking time for delivery vehicles has fallen from 24 minutes to 7 minutes in these pilot projects. By scheduling off-peak, queuing time has also been reduced significantly.
We will now work with several more malls.
[1]
Their operators have expressed interest in adopting the improvements showed at the pilot.
Second, we will pilot off-site consolidation of deliveries, to amplify the savings from in-mall consolidation of distribution. These solutions seek to consolidate goods headed towards a common destination, optimising loading of trucks to further reduce freight traffic.
CapitaLand will roll out this off-site solution to serve its malls in the west next year. We will encourage more such solutions in the next two years.
Third, in tandem with the rapid growth of eCommerce market we will roll out a nation-wide locker system by next year.
I had announced our plans to implement a system of Federated Lockers earlier this year. Since the announcement, many interested parties have made proposals. In the last few months, IMDA has explored new and innovative ideas from industry, including proposals from local start-ups. We have also studied similar solutions overseas.
The success of this lockers project depends on a few key factors.
We invite interested parties to stay involved in our consultations. We will finalise our approach by 2H2017 and invite industry partners to collaborate in the island-wide deployment.
The federated locker system will benefit logistics and consumers. But we will also support our retailers, so they can ride the eCommerce wave not just locally but internationally. SPRING Singapore and IMDA will provide this support under the Retail Industry Transformation Map.
Over the medium-to-longer term, we will be looking at other new and broader solutions to stream-line and improve domestic logistics efficiency.
Beyond malls, we will be exploring the feasibility of precinct-wide distribution facilities. This involves precinct level consolidation of deliveries, to reduce multiple last-mile deliveries and benefit traffic and living spaces within the precinct. Our agencies will spend the next year studying this.
More ambitiously, another longer term solution being explored is to connect the island using an integrated goods-mover system, that enables autonomous vehicles to be deployed. A feasibility study is currently being conducted by JTC.
High Quality Jobs in Logistics
The result of these various initiatives will also develop new high-quality jobs.The SingPost facility here is also a good example of the kind of job transformation. I would like to highlight just one example. Mr Muhammad Khairul Anwar Bin Joha is a Processing Officer who joined the company 5 years ago. He used to manually process and sort up to 2000 mail items and parcels in a workday. Today, he operates fully automated parcel sorting machines with automation control, fault identification and clearing, sorting up to 10,000 items per hour. To prepare for his new role, Khairul was given the opportunity to upskill himself through a combination of short formal training courses and On-The-Job-Training by internal trainers and technical vendors. Our companies have to do all we can to deploy the most productive technologies in logistics, and improve the quality of jobs and long-term career prospects of Singaporeans in the logistics industries.
I am heartened by SingPost’s efforts to drive transformation in a rapidly evolving industry. Its focus on operational excellence and innovation will yield rewards as the eCommerce wave transforms business and consumer behaviour in the years to come.
On this note, let me once again offer my heartiest congratulations to SingPost on the opening of this Regional eCommerce Logistics Hub.
[1] Malls from CapitaLand, Prime Point Realty Development, Fraser Centrepoint, LendLease, AsiaMalls, CDL, and Far East Organisation are among those which have expressed interest in in-mall distribution.
Mr Simon Israel, Chairman, Singapore Post,
Distinguished Guests,
Ladies and Gentlemen,
Introduction
It gives me great pleasure to join you today at the opening ceremony of Singapore Post’s Regional eCommerce Logistics Hub.
The Hub marks a significant milestone in SingPost’s transformation into a leading eCommerce logistics company in Asia.
SingPost’s Transformation into Leveraging eCommerce
It’s been an impressive journey. The rise of the digital economy had disrupted SingPost’s traditional business in postal services. The company responded by harnessing digitisation itself, to reinvent itself in eCommerce logistics. By last year, SingPost was managing S$5 billion worth of eCommerce merchandise.
This hub will play a critical role. Its intensive deployment of technology ensures fast and accurate processing and sorting of eCommerce parcels. It will enable SingPost to continue being a strong partner to merchants and platforms in the rapidly-growing eCommerce market.
Singapore’s Ambitions for a World-Class Urban Logistics System
SingPost’s transformation is a good example of the journey our wider domestic, or urban, logistics sector will have to undergo.
We have an efficient and competitive external logistics sector, anchored in Changi and the port.
However, our domestic logistics sector has great room for productivity improvements.
It also impacts the liveability of the city.
We know how things could be done differently – much more efficiently, at lower costs overall, and with less traffic congestion caused by goods vehicles. Cities like Tokyo, London and Zurich are exploring innovative solutions to achieve this.
We must therefore transform domestic logistics - to raise productivity and job quality, and reduce traffic congestion. It will mean leveraging on technology and new business models in logistics. We will also aim to cap the growth of jobs such as drivers and warehouse workers, while redesigning them into higher skilled jobs. There is no choice. We have many local workers who will retire from the sector in the next 10-15 years, and a shortage of Singaporeans to fill up the same jobs.We also aim to reduce delivery vehicles during peak-hour by 20-30% within a decade.
We will be implementing several strategies to achieve these objectives.
First, we will accelerate the in-mall consolidation of deliveries.
In April this year, I announced two pilots for in-mall distribution at Tampines and Bedok Mall. These pilots involve a single in-mall operator which receives and consolidates deliveries, and enables trucks to turn-around quickly. The pilots are progressing well.
The average parking time for delivery vehicles has fallen from 24 minutes to 7 minutes in these pilot projects. By scheduling off-peak, queuing time has also been reduced significantly.
We will now work with several more malls.
[1]
Their operators have expressed interest in adopting the improvements showed at the pilot.
Second, we will pilot off-site consolidation of deliveries, to amplify the savings from in-mall consolidation of distribution. These solutions seek to consolidate goods headed towards a common destination, optimising loading of trucks to further reduce freight traffic.
CapitaLand will roll out this off-site solution to serve its malls in the west next year. We will encourage more such solutions in the next two years.
Third, in tandem with the rapid growth of eCommerce market we will roll out a nation-wide locker system by next year.
I had announced our plans to implement a system of Federated Lockers earlier this year. Since the announcement, many interested parties have made proposals. In the last few months, IMDA has explored new and innovative ideas from industry, including proposals from local start-ups. We have also studied similar solutions overseas.
The success of this lockers project depends on a few key factors.
We invite interested parties to stay involved in our consultations. We will finalise our approach by 2H2017 and invite industry partners to collaborate in the island-wide deployment.
The federated locker system will benefit logistics and consumers. But we will also support our retailers, so they can ride the eCommerce wave not just locally but internationally. SPRING Singapore and IMDA will provide this support under the Retail Industry Transformation Map.
Over the medium-to-longer term, we will be looking at other new and broader solutions to stream-line and improve domestic logistics efficiency.
Beyond malls, we will be exploring the feasibility of precinct-wide distribution facilities. This involves precinct level consolidation of deliveries, to reduce multiple last-mile deliveries and benefit traffic and living spaces within the precinct. Our agencies will spend the next year studying this.
More ambitiously, another longer term solution being explored is to connect the island using an integrated goods-mover system, that enables autonomous vehicles to be deployed. A feasibility study is currently being conducted by JTC.
High Quality Jobs in Logistics
The result of these various initiatives will also develop new high-quality jobs.The SingPost facility here is also a good example of the kind of job transformation. I would like to highlight just one example. Mr Muhammad Khairul Anwar Bin Joha is a Processing Officer who joined the company 5 years ago. He used to manually process and sort up to 2000 mail items and parcels in a workday. Today, he operates fully automated parcel sorting machines with automation control, fault identification and clearing, sorting up to 10,000 items per hour. To prepare for his new role, Khairul was given the opportunity to upskill himself through a combination of short formal training courses and On-The-Job-Training by internal trainers and technical vendors. Our companies have to do all we can to deploy the most productive technologies in logistics, and improve the quality of jobs and long-term career prospects of Singaporeans in the logistics industries.
I am heartened by SingPost’s efforts to drive transformation in a rapidly evolving industry. Its focus on operational excellence and innovation will yield rewards as the eCommerce wave transforms business and consumer behaviour in the years to come.
On this note, let me once again offer my heartiest congratulations to SingPost on the opening of this Regional eCommerce Logistics Hub.
[1] Malls from CapitaLand, Prime Point Realty Development, Fraser Centrepoint, LendLease, AsiaMalls, CDL, and Far East Organisation are among those which have expressed interest in in-mall distribution.
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