Kuala Lumpur, Malaysia- Logistics service providers can expect more business from in bound transportation in four ASEAN countries - Indonesia, Malaysia, Singapore and Thailand as it is the most likely activity to be outsourced in the future.

“This is because the top three activities that are likely to be outsourced - inbound transportation, inbound warehousing and outbound warehousing - were selected by more than 65 per cent of the respondents in the four ASEAN countries,” says Frost & Sullivan’s Team Leader for Logistics, Srinath Manda.

New analysis from Frost & Sullivan (transportation.frost.com), ASEAN 4 Logistics Users - Trends & Preferences, reveals that more activities from Singapore are likely to be outsourced than those from Indonesia, Malaysia and Thailand.

Manda says that currently, Indonesia has the highest cost of logistics as a percentage to total sales at 19.5 per cent while Singapore has the lowest at 8.3 per cent. Logistics cost in Malaysia is at 12.7 per cent while Thailand is at 17.8 per cent.

Across all four countries, transportation and warehousing make up the larger bulk of logistics costs, he adds.

The levels of technology adopted by logistics end users across these four ASEAN countries are low. Most of the logistics service providers are using only basic bar coding and packaged ERP, observes Manda.

“Most of the logistics end users surveyed are not willing to adopt new technologies in the future due to high costs involved,” he adds.

Logistics end users from all four ASEAN countries also said that they outsourced their logistics functions to service providers to generate cost savings.

Overall, the most important criteria for selecting the logistics service providers in the four ASEAN countries are quality of service, speed and consistency of service and reasonable price for overall logistics services