Find out how Janio helped our client with rapid international expansion, balancing shipping costs and performance and returns in Australia in this case study.
January 13, 2023
A global brand with a strong offline merchandise market share wanted to expand into B2C eCommerce channels in its Asia Pacific market for the first time.
While strong in traditional channels such as brick and mortar retail and distribution, the brand lacked the local infrastructure, logistics partner network, and local knowledge to expand rapidly in terms of direct-to-consumer delivery in several key markets. The brand was looking for a forward and returns logistics solution that covers multiple countries including Southeast Asia’s key markets. The solution also needed to scale quickly in time for the upcoming fourth quarter peak period that year. They also looked to diversify their direct-to-consumer logistics providers in terms of costs, so the solution they were looking for needed to be cheaper than prevailing express rates without sacrificing delivery speed.
Below are the markets covered in our client’s solution:
1 Month Onboarding and Key Lanes Ramp Up
Janio has established a wide network of trusted logistics providers across Southeast Asia and beyond, with key hubs being located in Singapore, Indonesia (Jabodetabek/ Greater Jakarta and Bali) and Malaysia, with a minimum of 200,000 monthly orders and counting.
Janio was able to finish the implementation of our client’s logistics requirements in our established key markets within a month. In the first month, Janio fulfilled 1000 orders before ramping up to a steady 2,500 orders monthly from then on.
Below are some performance highlights of the lanes that this client uses:
Return Shipments Service: How it Works in Australia
Returns shipments were required in our client’s selected markets. Using Australia as an example, Janio has partnered with Auspost to provide drop off locations as well as pick ups in urban locations to provide flexibility for our client’s Australian customers. Australia Post as of the time of this writing has over 4320 post offices across Australia.
Janio’s returns system allows our client’s returners to choose three return shipment options:
Return Drop offs
Letting Their Shoppers/ Consignees Choose from the Above Two for themselves
The Returns Shipment Experience:
Stage 1: Requesting a Return Order and Setting the Pick Up Date
When the customer requests a return shipment, they will first receive an email and an SMS providing them with instructions on how to proceed. The instructions contain a link to Janio’s merchant portal where they will be able to create the return shipment order. They are able to choose whether the return is done via pick up or drop off, schedule the pick up date if needed and key in your desired return address.
If the pick up option is chosen, the customer can schedule the return date with Janio during order creation. Please note that if the customer doesn’t provide a date, the default proposed pick up date will be 2 working days after the date they created the return order or the next earliest available date.
If the drop-off option is being used, customers do not need to key in a date and can go straight to the next step.
Stage 2: Notifying and Authenticating the Customer’s Return Order
After the return order has been created, our team will send both an email and sms notification to your customer.
After clicking the link provided, customers will first need to verify their phone numbers via a one-time-password (OTP) as shown below. Their phone number is taken from the original order information that they keyed in when checking out their order on the client’s online store.
Stage 3: Customer Chooses and Confirms Returns Arrangements
Once verification is complete, what the customer will need to confirm the details of their shipment. These include the list items being picked up, choosing between pick ups or drop offs as well as confirming the time or location of the pick up.
Letting your customer choose:
If this option is selected, your customer can choose the most convenient return service for them before going through their selected workflow below.
Your customer will either confirm or reschedule the pick up date with us. Pick ups will take place between 9am and 7pm on the scheduled date, with a phone call to confirm the pick up before the driver arrives.
Your customer first checks the items to be returned before selecting a drop off location. There are around 87 drop-off locations Singapore-wide as of the time of this writing. You can see our list of active drop-off locations here.
Janio currently works with Auspost for our drop-off capabilities. Auspost’s 4320 post offices can be used as drop-off locations for Janio’s returns procedures with our current arrangement.
Once the returner has confirmed their returns arrangements, they’ll receive a confirmation notification from us via email and SMS.
Stage 4: Confirmation Email and SMS
The confirmation email they receive will have everything they need to prepare for their delivery. It contains:
The label they need to print on the parcel
Instructions for them to prepare the parcel
15 – 20% Cheaper Rates, 97% On Time Service Levels: Optimising the First, Mid and Last Mile
As part of Janio’s 4PL solution, the client also trusts Janio to find the best balance between good shipping rates and good delivery performance. Janio’s optimisation techniques for the first, mid and last mile helps us achieve 15 to 20 per cent cheaper rates for the brand while keeping service levels hitting 97% success rates.
Optimising Last Mile Deliveries and Handling Exceptions
Janio utilises data and technology to manage the optimum combination of network partners at each leg of the delivery journey. Depending on our partners’ performance data, Janio is able to easily change the volume allocations from one network partner to another to achieve optimum results. To manage unforeseen circumstances, we also have human interaction involved when any exceptions arise.
To manage partner performance, our network partners’ performance data is continuously gathered. This data, such as performance at each leg of the journey is input into the system, is put into the system to be analysed to see where volume reallocations to a different partner needs to occur. With this, we stabilise our performance and manage our last mile network by reallocating the volume to partners that match or exceed our expectations.
To manage costs, we run analyses on the cost per parcel for each of our vendors. When the performance between 2 of our vendors is roughly similar but the cost is different our system recognises that relocation needs to happen to the cheaper equally performing partner rather than the more expensive, equally performing partner.
Exceptions can hamper the quality of our service level if not managed well, which is where human intervention for extraordinary circumstances comes into play. One example is flooding in some of the markets that we operate in, a key lesson that we learned in Malaysia. During flood season, our 3PLs will give us a heads up that their sortation hub is in a danger zone for floods during that period.
When we receive the data before the floods occur, our staff are able to respond to this and start doing reallocation to other sortation hubs that are outside the danger zone. This way, we can prevent parcels from being impacted by floods or natural disasters.
How First and Mid Mile Deliveries are Optimised
The foundation that Janio uses to manage the last mile leg of the journey is used in our first and mid mile optimisations as well, but with some constraints unique to each leg.
For the first mile leg, one constraint is the fulfilment partner or provider that we pick up from. While less flexible than managing last mile partners, first mile network partners will still be changed accordingly but with sufficient time for the fulfilment staff to make adjustments without negatively impacting service levels.
To prevent miscommunication or misalignment with the sorting hub, Janio plans changes to pick up partners with a sufficient notice period factored in. If multiple first mile partners are used without a sufficient notice period, the need to communicate and collaborate with more parties could increase the chances of mistakes and affect service quality.
The process of optimising for mid mile delivery performance and cost also follows the same process for last mile delivery optimisation, but its flexibility is limited due to the contracts that need to be signed with co-loaders, freight forwarders, shipping companies or airlines in the case of lanes that Janio manages itself.
These contracts usually span at least one month which necessitates more advance planning. Carriers will be switched at the end of the contract period, but in extreme cases where Janio needs to switch to a different carrier during the contract period penalties will be incurred. Through these cost and performance optimisation processes across the first, middle and last mile, Janio was able to get rates that were 15 to 20 per cent lower than the incumbent rates that our client was previously considering.
So the basis and the logic is the same for all three. It is just the flexibility and the agility and the manoeuvring around that is different for all three.
Speed and Flexibility to Expand International Lanes
In addition to Janio’s established lanes such as Australia and key Southeast Asia markets, the lanes to Japan and South Korea needed to be rapidly set up as part of the client’s requirements.
Our process was able to set up all the lanes required within 1 month’s time. The solution involves managing optimised combinations of logistics providers within our network to give the brands working with us the best delivery service quality at the best possible price.
Working with over 200 different logistics providers, we also take full responsibility for vetting and onboarding the best new logistics providers that fit the needs of our clients, in this case providing forward and reverse logistics services for the lanes mentioned above.
The Partner Onboarding Process
Janio is a carrier agnostic 4PL. We are able to partner with most logistics service providers as long as they meet certain strict standards. The carriers need to be legitimate entities, be compliant with their agreed service-level agreements, and be able to fully integrate with Janio and the customer’s systems. In the case of the subject of this case study, we were able to use this process to establish our new Japan and South Korea lanes over the course of 1 month.
As part of our solution, we shoulder the risks and liabilities of selecting and onboarding new network partners on behalf of our clients. For shippers who handle their own network partners, it can take on average 5 to 7.5 months to onboard and integrate with a new shipping partner, with larger shipping partners taking longer times.
Request for Quotation (RFQ) periods could take between 1 to 2.5 months while the tech integration could take anywhere between 4 to 5 months to fully onboard a partner. When considering the time-value of money, all these steps require man-hour commitments from your company if you are doing this in-house. Our selection and onboarding process involves the following:
Clarifying service fit with client needs: affirming the partner’s capabilities in terms of service types provided (local deliveries vs customs clearance vs international line-haul) and the lanes that they specialise in.
Due diligence processes to ensure compliance and weed out bad actors:
Conducting background checks on the owner of the service provider
Anti-bribery and anti-corruption letter signing
Contract drafting and signing
Tech integration with Janio’s systems
Test Shipments: to test the partner’s reliability, affirming the partner’s capabilities and testing the robustness of the API integrations
With an experienced team to handle all the requirements for quick and compliant onboarding of network partners, our clients’ man-hours are freed up for other tasks such as handling sales, marketing and operations for other regions.
With Janio, our client was able to rapidly expand their direct-to-consumer eCommerce delivery coverage to Singapore, Malaysia, Indonesia, the Philippines, Hong Kong, Australia, New Zealand, Taiwan, South Korea and Japan.
The burden of needing to find, vet through, onboard and manage multiple network partners was taken off their shoulders while gaining the cost and risk management advantage of a wide network. With Janio’s large variety of network partner, specialised services like returns in each of their markets was also fulfilled. From our past performance, our client continues to trust us to keep their operations running smoothly and efficiently.