To minimise the risk of spread of COVID-19, The URA Centre is closed until further notice. Members of the public are to use our e-services. Read more here.

Speech by Mr Lawrence Wong, Minister for National Development and Second Minister for Finance, at the Launch of Urban Lab: ‘Delivering Together: Transforming Urban Logistics’ Exhibition

  Published: 04 December 2018

I am very happy to join you this afternoon at the launch of this exhibition on urban logistics.

All of us know that Singapore is a regional hub and leading logistics centre. But we do not take our position for granted, and we are never complacent about our position today. With the growing pervasiveness of internet connectivity and the rise in cross-border exchanges, and the fact that they are increasing in scope and complexity, we know that we cannot afford to stand still. That is why we are doing more to stay relevant, and to strengthen Singapore’s hub status. That is one of the reasons why we are expanding our air and sea ports, to ensure that Singapore remains plugged in to the evolving supply chains in the region.

While we have good air and sea gateways, we also cannot neglect logistics within Singapore itself. We need to optimise the delivery of goods within our island to bring greater convenience to consumers; to help businesses lower costs; and ultimately, to enhance our competitiveness as a regional hub. So urban logistics is not just a good-to-have; it is in fact an important economic strategy, and an essential part of our connectivity to the region. This exhibition features some ideas which will enable us to do better and push the frontiers. I will share three broad areas where we think we can really move forward.

Improving Last Mile Delivery for Consumers

One is on last mile delivery for consumers. There are many ways where we can improve last mile delivery, particularly for small items, from businesses to consumers.

We know that Singaporeans are purchasing more and more items online. We are shopping not just from internet giants overseas like Amazon or Alibaba; we are also buying more items locally online, including food items, cooked food and groceries.

All this brings tremendous convenience for consumers. But there are challenges with last mile delivery for these small items. Consumers are not always at home, and they may miss deliveries. The delivery-man then ends up taking extra time and making extra trips to fulfil the order. And if the item still cannot be delivered, consumers will then have to travel out of their way to collect their purchases. 

So we should make the collection of purchases more convenient through an expanded network of collection points. Some companies already do this today – they have lockers where you can pick up your packages. But what we need is a nationwide network of lockers that can be used by all operators and mail services, and which are conveniently located across all our housing estates, so that residents can easily access them.

Such collection points can also go beyond lockers, to your neighbours’ home, or to nearby shops within that estate itself. In fact, a company, Park N Parcel, has started a service to enable consumers to collect delivered purchases from these points. So these are all good ideas which we are working on and exploring actively, to improve last mile delivery and support the evolving retail industry in Singapore. This is the business-to-consumer (B2C) part on improving last-mile delivery.

Optimising Deliveries for Businesses through Consolidation and Technology

Second, we also can do better when it comes to business-to-business (B2B), and how deliveries can be optimised through consolidation and the use of technology.

Today, if you look at any mall, retail shops typically have their own logistics providers to bring merchandise from their warehouses to their retail shops. There are trucks coming from multiple warehouses to all the different shops in the malls. This means multiple trips by different delivery companies, and often the trucks are hardly full. It means much more travel time, which adds to congestion on the roads. In fact, a recent study found that trucks going into Orchard Road for deliveries are less than 40 per cent full, and bound for only one shop per mall.

Imagine what would happen if we could consolidate some of these trips. So one idea is to have consolidation centres at the warehouse level, at source. This means that all the goods from separate companies can be consolidated in one place before delivery to the retailers. This will better utilise truck space and reduce the number of truck trips. We already are trying out some pilots – some companies are running such consolidation centres. One example is AAK Logistics Services. Their experience with these consolidation centres so far has been very positive – they have been able to reduce truck trips by more than 20 per cent and this has translated into a reduction in costs for their customers by 15 to 20 per cent. This is a very promising idea, which we can explore further.

Consolidation can also take place at the retail level. Currently, every building will have its own loading and unloading bay. But we can design buildings differently. We can design buildings such that those in close proximity to one another all share a common loading bay. Then, the trucks only need to come to one place, unload their goods, and the goods can then be delivered to each individual building. At the loading bays, you can use technology to also better schedule vehicle arrivals, to avoid vehicles coming at the same time, and a bunching of vehicles, especially during the peak periods. These changes will take some time to do. It is not easy to redesign an existing loading bay in an existing mall or building, but we are certainly studying them for new districts like Punggol and Jurong Lake District to see if we can design the buildings in a different way and have common or shared loading bays, so that we can facilitate consolidation at the retail level.

Next, delivery routes can also be optimised for companies through technology. For example, a local company, VersaFleet, has developed transport management software that can plan optimal delivery routes for companies to improve their operations. One of its customers, a logistics company, has reduced the time spent on operational planning by 75 per cent, and also taken on 20 per cent more jobs with better truck utilisation. These are all ideas around B2B – consolidation at source, better optimisation of routes, and consolidation at retail – many ideas where we can optimise deliveries across the entire value chain.

Strengthening Multi-Modal Logistics Links Across Singapore

Finally, we need to look at urban logistics as an integrated system for the whole of Singapore. While this exhibition is focused on business-to-consumer and business-to-business logistics, urban logistics is ultimately part of a larger multi-modal logistics system bringing goods into and out of Singapore.

This system consists of key gateways such as our sea port, airport and land links. As our gateways develop further with the expanded Changi Airport in the East and Tuas mega-port in the West, we will need to look at ways to connect these gateways even more seamlessly and enhance Singapore’s overall value proposition as a supply chain hub.

One example of how this can bring better benefits is in the idea of providing cold-chain logistics for chilled lamb. This is already happening, with the chilled lamb shipment from New Zealand. Upon arrival of the chilled meat by air at Changi Airport, SATS provides a cold-chain corridor – they break bulk, segregate and load up the containers to the sea port. These containers will then be trucked to the port for subsequent shipment to Europe. This is multi-modal, and a whole logistics system. SATS is now working with PSA to see how they can shorten the transit time for multi-handling shipments including general cargo.

So when you look at the logistics system as a whole – combining our two gateways and what we can do within Singapore, there are many possibilities to explore. We can identify many areas where we can better synergise our efforts, reap even greater efficiencies, and enhance our overall connectivity.

Conclusion

In conclusion, the ideas and innovations on display at this exhibition today give us a sense of how we can do better and strengthen our position as a regional and global logistics centre. The Government will do its part; we are actively pursuing all of these ideas, but we cannot move forward alone. We welcome and encourage retailers, logistics companies and other stakeholders to learn more about these ideas, so we can collaborate and work together to bring these ideas to fruition.

That is the motivation behind this exhibition – to raise awareness about all the different things that are happening on the urban logistics front, to spark further conversations amongst stakeholders, and forge new partnerships. Hopefully by working together, we can all take logistics to a higher level, and ultimately bring greater benefits to all Singaporeans.

Thank you very much. Please enjoy the exhibition. 

 

Top