Lalamove: Revolutionizing On-Demand LogisticsBy Andrea Villar | Tue, 05/11/2021 - 05:00
Q: What are the benefits for companies that decide to entrust their logistics to Lalamove?
A: Lalamove is an Asian company that has been operating in Mexico for just over a year. We launched the platform here just before the pandemic started. Globally, we have been in the market for more than seven years, while in Latin America we ventured into Brazil two years ago. In the US, we have a number of solutions that mainly focus on last-mile deliveries, either same-day or next-day deliveries to support SMEs. For SMEs, Lalamove is a good option because many of them do not have the budget, knowledge or time to oversee their own logistics. This is where we come in, providing them with a platform that can deliver products immediately and economically. More than a company, we are a platform that connects users who need to deliver products with driving partners who have the vehicles to make those deliveries.
We offer a great deal of flexibility within the platform. Users can choose from a motorbike, SUV, sedan or cargo truck. Through our app, users can deliver almost anything with ease, whether it is a document via a motorbike or construction material via a cargo truck. We have a much more B2B approach than B2C.
In Mexico, our coverage area includes Mexico City and the State of Mexico. We have expansion plans for other cities in the country. We do not want to be one of those companies that arrive and begin operating in the whole country without a consolidated operation. Lalamove is an innovative and flexible solution but we want to make sure we have a very good operation before expanding to other cities.
Q: What is the difference between Lalamove and traditional logistics companies?
A: Traditional logistics companies manage their operation through waybills or monthly delivery reports as part of a corporate account, for example. Lalamove does not have any of this. We do not handle waybills and there are no contracts unless a client asks for one for a very specific operation. We encourage companies to hire us according to their needs. We have customers who call on us once a month and others who ask for our service 100 times a day and we provide the same attention to all of them. We do not have warehouses either. The biggest difference is that we make dedicated deliveries, which means that all the products that are being transported in a vehicle belong to that company. This allows deliveries to be made much faster and improves safety because the package goes directly to the end customer without any additional stops.
Q: What have been the biggest challenges Lalamove faced setting up its operation in Mexico City in the midst of the pandemic?
A: Lalamove came to Mexico from Brazil in December 2019 to get to know the market. We know that we cannot simply replicate the same strategies that were successful in other parts of the world. That said, for a couple of months, we were studying the market, talking to SMEs and driving partners to see what Mexico was like. We realized that this was a market where we could bring a lot to the table and decided to officially launch in March 2020. Of course, it was a challenge, starting with the fact that more than 80 percent of our team has been hired remotely. Creating teams remotely is a big challenge. We also had to adapt all processes to the Mexican market.
Due to the pandemic, many companies had to rethink the way they sell and distribute their products and that helped us a lot as well. At the same time, this was a challenge because we did not plan to grow so fast and we had to accelerate many projects. In summer last year, for instance, we launched our food and beverage delivery option. This led many restaurants to our platform because we do not charge them fees for the product itself. If a taqueria wants to sell a MX$100 (US$5) dish, we do not touch a penny of that; other marketplaces or food-delivery apps do.
In December we also launched an API that allows the Lalamove platform to be integrated into an e-commerce platform or website to accommodate automatically scheduled deliveries. All these solutions were introduced to the market after listening to our customers. It was a year of learning for us.
Q: What is the logistics landscape among traditional retailers?
A: Last year, large and well-known retail companies in Mexico experienced many logistics problems. Many people started buying online and the companies did not have a developed e-commerce platform or defined delivery processes. If these failures happened to large companies, imagine the impact on smaller companies. Companies have now recognized that it is necessary to adopt an omnichannel strategy in order to be competitive. Many of our clients have realized that by opening their business to other markets through e-commerce they have opened the door to customers who would never have come to their physical shop.
People now know that they can buy almost anything online and, therefore, their expectations are higher. It used to be common to receive packages in three to five days, but now people want it on the same day or the next day at the latest. Not only do they want it to arrive quickly, but they want the delivery to be secure and cashless. At the beginning of the pandemic, we reinforced the use of online payments to avoid handling cash on delivery. At Lalamove, our drive partners' cellphones are equipped with GPS. This allows the customer to see exactly where the product is in real time.
Q: What opportunities and trends does Lalamove plan to take advantage of in Mexico this year?
A: The use of technology in logistics will clearly continue to open new opportunities to improve deliveries and customer service through chatbots, for example. Another trend we see is the delivery of packages using drones. This is a long-term implementation in the industry but Mexico could be a good pilot country for such projects. Drone delivery can save up to 80 percent of the time and that is very significant for a place like Mexico City. Beyond this, the past year has been a learning experience and all the information gathered will help us to provide even more personalized services to our customers, with faster and more economical deliveries.
Lalamove, founded in 2013, is a logistics company that provides on-demand and same-day delivery services