Supported by:

November 22, 2021

Evaluating Singapore’s
Logistics Market
Potential:
Logistics Market Profile and
Logistics Technology Landscape

WHAT’S INSIDE
I. Singapore’s Logistics Market Profile
II. Technology-Enabled Logistics in Singapore
III. Technology as a Tool for Supply Chain Sustainability

Disclaimer 2021 Vynn Capital

Information herein has been obtained from third-party sources as well as researches performed by Vynn Capital. Although we believe that high standards
have been used in preparation of the information, analysis, and views, Vynn Capital accepts no liability whatsoever for any direct or consequential loss
arising from its use. This report is for general purposes only. It may not be published, reproduced or quoted in part or whole, nor may it be used as a basis
for any contract, prospectus, agreement or other document without prior consent.
Singapore’s Logistics Market Profile
Figure 1: Import of goods from 2011 to 2020
Singapore plays a premier role in the global logistics
(in billion U.S. dollars)
market. As an open economy with the world’ third
400 20%
highest rate-to-GDP ratio at 321% in 2020, trade,
350 15%
connectivity and infrastructure are crucial to
Singapore’s economy. According to World Bank, 300 10%

Singapore ranks as the 2nd major logistics hub in Asia 5%

250
and 7th worldwide. This can be attributed, in a large 0%
200
extent, to the active integration of technology into the -5%
150
supply chain process: Singapore processes 90% of -10%
100
permit electronic applications within 10 minutes and -15%
clears 90% of physical cargo within 8 minutes. Among 50 -20%
the key sub-sectors of the logistics market are contract 0 -25%

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020
logistics, freight forwarding and land transportation.
Import of goods (lhs) Year-over-year change (rhs)
Singapore has been successful in FTA negotiations,
reaching conclusion in record time. Singapore’s FTA Figure 2: Export of goods from 2011 to 2020
partners include developing economies of the PRC, (in billion U.S. dollars)
India, and Southeast Asia as well as rich industrialized 450 20%
economies of the US, European Union, and Japan. Such 400 15%
economic complementarity facilitates both inter- 350 10%
300
industry and intra-industry trade. 5%
250
0%
200
Singapore is one of the main global trading hubs due to 150
-5%
the high quality of its port infrastructure. There are up 100 -10%
to 200 connection vessels in Singapore at any moment 50 -15%
and all types of ships are able to enter the port owing to 0 -20%
deep berth areas, quay lengths, and depths of harbor.
2011

2012

2013

2014

2015

2016

2017

2018

2019

2020
Owned by the Singapore-based and world’s leading
marine terminal operator PSA International, Singapore’s Export of goods (lhs) Year-over-year change (rhs)

Figure 3: Estimated asset investment commitments in Singapore Table 1: Major manufacturing industries by output value
in 2020, by industry (in million Singapore dollars)
2020 output value (in % of total
Electronics 6 475 Manufacturing industry Singapore million manufacturing output
dollars) value
Chemicals 4 114
Computer, Electronic &
137,406.7 46.26%
Optical Products
Research & development 1 328
Chemicals & Chemical
37,625.5 12.66%
Transport engineering 1 280 Products

Machinery & Equipment 27,231.5 9.16%

Infocommunications & media 1 069
Refined Petroleum
21,580.1 7.26%
Logistics Products
1 032
Pharmaceutical &
Biomedical manufacturing 638 16,010.3 5.39%
Biological Products

Engineering & environmental Other Transport

511 12,723.5 4.28%
services Equipment

Precision engineering 429 Other Industries 44,441.5 14.96%

Source: Maritime and Port Authority Singapore; UNCTAD; Lloyd’s List; Singapore Economic Development Board
2
Singapore’s Logistics Market Profile

four container terminals have connections to more Figure 4: Container ship fleet size as of January 2021, by nationality of operator
than 600 ports in over 120 countries and are global (in gross tonnage)
hubs for transshipments. Notwithstanding the Greece 176 894 157
competition from neighboring Hong Kong and Singapore 134 299 723
Malaysia, Singapore remains first in ASEAN for China 128 301 436
container throughput. Since 2010, Singapore’s port Japan 117 689 836
container throughput has been constantly increasing Denmark 62 858 174
and reached 36.87 million TEUs in 2020 vs. 28.41 Hong Kong 61 777 483
million TEUs in 2010. In 2020, the Port of Singapore Germany 61 528 955
ranked the 2nd largest container port in the world by United States 60 146 030
throughput, only after Shanghai, China (43.50 South Korea 59 772 383
million TEUs). In addition, as of January 2020, Switzerland 56 518 967
Singapore owns the fifth biggest fleet in terms of United Kingdom 53 786 897
deadweight tonnage and third biggest fleet in terms
of vessels. Singapore’s fleet consisted of some 4,914 Figure 5: Number of tanker arrivals in Singapore from 2007 to 2020
ships with a total deadweight tonnage of 140 million (in 1,000s)
tons in 2020. 30 8%
25 6%
To accommodate for increasing throughput,
20 4%
Singapore is building the mega-port in the western
15 2%
part of the city, the Tuas Terminal. The Tuas Terminal
is expected to be the world’s largest fully automated 10 0%
terminal, when it will be completed in 2040. The port 5 -2%
will have automated yard cranes, drones, and 0 -4%
driverless vehicles for port transport.
2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020
Number of tanker arrivals (lhs) Year-over-year change (rhs)
In the trucking segment, there were a total of 150 to
200 players in Singapore, as of 2020. 76% of trucking Figure 6: Median time spent by vessels in the Port of Singapore from 2018
companies are in the small-tier segment, 14% are in to 2020 (in days)
0.68
the mid-tier segment, while the remaining 10% are in
the large-tier segment. According to the Converging 0.66
0.65
Knowledge Report, ca. 90% of mid-tier trucking
companies have evolved from one-stop trucking
service providers by expanding their service offerings
with freight forwarding and warehousing/storage. 2018 2019 2020
Figure 7: Major terminal operators worldwide in 2019, based on Figure 8: GDP of the transportation and storage industry, Singapore, 2012-
equity-adjusted throughput (in million twenty-foot equivalent 2020
units) (in billion Singapore dollars)
PSA International 60.4 35 20%
30
China Cosco Shipping 48.6 10%
25
20 0%
APM Terminals 46.8
15 -10%
10
Hutchison Port Holdings 45.7 -20%
5
DP World 44.3 0 -30%
2012

2013

2014

2015

2016

2017

2018

2019

2020

China Merchants Ports 41.5 GDP of the transportation and storage industry Year-over-year change (rhs)

Source: Maritime and Port Authority Singapore; UNCTAD; Lloyd’s List; Danske Rederier
3
Singapore’s Logistics Market Profile
Table 2: Air cargo loaded by country/region of destination, 2020
Singapore’s airfreight market remains the most efficient in
Southeast Asia and Southwest Pacific and ranks as the highest Country/region Tonnes % of global air cargo loaded
in terms of connectivity from a frequency and capacity point of Hong Kong 79,790.0 11.08%
view. These factors allow logistics operators to provide
competitive B2B inbound rates and B2C cross-border logistics Mainland China 77,188.0 10.72%
services in Southeast Asia. At times, air freight costs in Thailand 53,192.9 7.39%
Singapore can be up to 40% to 45% cheaper compared to
Japan 40,968.1 5.69%
Malaysian Airlines via KLIA and Thai Airways via Suvarnabhumi.
Indonesia 38,893.5 5.40%
Moreover, Singapore’s Changi’s Airport is named the best Malaysia 23,404.9 3.25%
world’s air cargo airport in terms of performance, value and
United Kingdom 21,878.5 3.04%
facilities (Source: Air Cargo Excellence Report 2018). The airport
has one of the widest networks in Asia with connectivity to 411 Vietnam 15,701.3 2.18%
cities and 99 countries and handling capabilities of up to Philippines 10,384.7 1.44%
325,000 tonnes of temperature-sensitive cargo annually.
Germany 9,544.4 1.32%
Operational excellence of Singapore’s air cargo market
attracted 24 out of 25 global largest airfreight forwarders to Figure 9: The largest container ports worldwide in 2020, based on
Singapore. throughout (in million TEUs)
Shanghai 43.50
As of 2020, Singapore’s logistics market was valued at US$7.57
billion, constituted 1.94% of GDP and employed approximately Singapore 36.87
205,500 people (5% of the residential workforce). According to Ningbo-Zhoushan 28.72
Mordor Intelligence, the Singapore logistic market is expected Shenzhen 26.55
to register an annual growth rate of 5% from 2021 to 2026.
Singapore established itself as a global logistics hub and will Guangzhou 23.51
continue to leverage on its competitive advantages such as Qingdao 22.01
efficiency, reliability and resilience of its network. Busan 21.82
Table 3: World’s largest logistics providers with operations in Singapore
Tianjin 18.35
Asia Europe USA Hong Kong 17.97
APEX Logistics Crane Worldwide Rotterdam 14.35
Agility
International Logistics
Figure 10: Deadweight tonnage of world merchant fleet by country of
Dimerco Express Group Bollore Logistics Expeditors beneficial ownership as of January 1, 2020 (in million dwt)
Hitachi Transport
CEVA Logistics FedEx Logistics Panama 328.57
System
Liberia 274.84
UPS Supply Chain
Kerry Logistics Network Dachser Marsall Islands
Solutions 261.92
Kintetsu World Express DB Schenker Hong Kong SAR 201.30
Singapore 140.15
Nippon Express DHL Global Forwarding
Malta 115.85
NNR Global Logistics DSV
China 100.47
Sinotrans Geodis Bahamas 78.04
Hellmann Worldwide Greece 68.51
Yusen Logistics
Logistics
Japan 34.52
Kuehne + Nagel Cyprus 34.52
Panalpina Indonesia 24.60

Source: Marine Department (Hong Kong); UNCTAD; Lloyd’s List; Changi Airport
4
Technology-Enabled Logistics in Singapore
Singapore’s technology logistics market is represented by a warehousing and e-fulfillment company Qxpress acquired
wide variety of rapidly growing startups in trucking & fleet, Hong Kong-based freight forwarding and third-party logistics
last mile delivery, warehousing & fulfillment, OMS, TMS, WMS firm KorChina Logistics to better serve cross-border business-
SaaS. With high labor costs and land constraints, Singapore’s to-consumer as well as direct-to-consumer demand.
government focuses on initiatives to support analytics &
optimization solutions. Singapore ranks in the top-10 smart One of the prominent players in the data analytics &
cities worldwide in 2020, with key factors for such a ranking optimization space is Singapore-headquartered Quincus,
including technology, urban planning, mobility and which automates manual tasks and provides real-time
transportation. visibility. The company’s modules include admin control with
customized documents sent to stakeholders, dispatch
A significant number of logistics startups provide delivery management, route optimizations, pricing, integration with
services in Singapore, including Hong Kong’s Lalamove (on- external systems for improved tracking. Quincus facilitates
demand trucking marketplace for last mile delivery), more than 70 million shipments per month and aims to help
Indonesia’s J&T Express (on-demand trucking marketplace), airlines, logistics providers, ecommerce firms, freight carriers
Singapore’s NinjaVan (last mile delivery) and Janio (trucking and household brands with their supply chain management.
marketplace). It is worth to mention that Singapore- The company’s geography of operations expanded outside of
headquartered NinjaVan’s valuation soared past US$1 billion Singapore to Indonesia, Malaysia, Mexico, Taiwan, Vietnam,
after its Series E round of US$578 million. The company United Arab Emirates, United States, and United Kingdom.
operates across Southeast Asia and expands its services Another notable logistics optimization startup with
beyond last-mile delivery towards helping independent operations in Singapore is India’s Locus. Founded in 2015,
online merchants source for products. Locus established its offices in United States, United
Kingdom, India, Singapore, Indonesia, Vietnam, and Germany,
Warehousing & e-fulfillment segment is represented by local and has gained clients in North America, Southeast Asia,
and international players in Singapore, namely, Locad Europe, and India. The company’s clients are represented by
(Singapore), iStore iSend (Malaysia), BEAM (Singapore), e-commerce, 3PL, FMCG and retail operators. According to
Anchanto (Singapore), J&T Express (Indonesia), iHub Smart Locus, the startup’s solutions for reverse/return logistics,
Logistics (Singapore), Qxpress (Singapore). Notably, dispatch planning and route optimization have saved its
warehousing & e-fulfillment companies expand their logistics clients up to US$150 million by mid-2021. With fluctuation in
offerings. For example, in 2021, Singapore’s cross-border demand, optimization plays a key role in the logistics market.
Figure 11: Cities in motion (smart cities) index ranking worldwide in 2020 Figure 12: Internet penetration in Asia as of June 2020, by country or region
London 100.00 South Korea 96.0%
New York 95.73 Brunei Darussalam 95.3%
Paris 85.50 Japan 93.8%
Taiwan 92.6%
Tokyo 81.95 Hong Kong 89.3%
Reykjavik 80.47 Singapore 88.4%
Copenhagen 78.51 Macao 83.3%
Berlin 77.46 Thailand 81.7%
Malaysia 81.4%
Amsterdam 77.31 Philippines 72.1%
Singapore 76.71 Vietnam 70.4%
Hong Kong 76.04 Maldives 68.4%
Zurich Mongolia 68.1%
75.96
Indonesia 62.5%
Oslo 75.79 China 59.3%
Chicago 75.04 Bangladesh 58.4%
Stockholm 75.00 Nepal 55.6%
Washington Bhutan 51.5%
74.32
Cambodia 47.9%
Los Angeles 74.10 Laos 42.0%
Sydney 74.07 Myanmar 40.8%
Vienna 73.84 India 40.6%
Sri Lanka 33.5%
Seoul 73.67
Pakistan 32.4%
San Francisco 72.40 Timor-Leste 31.1%
Source: IESE Cities in Motion Index 2020; Internet World Stats
5
Technology-Enabled Logistics in Singapore

Selected Players of Singapore’s Logistics Technology Landscape

Trucking and Fleet

Last Mile Delivery

Warehousing & Fulfillment

OMS, TMS & WMS SaaS

6
Technology as a Tool for Supply Chain Sustainability

Supply chain challenges continue to make headlines, and needs and increasing demand in the global supply chain.
several factors are altering short- and long-term supply
needs. Most frequent threats affecting global supply chains Supply chain challenges have accelerated the adoption of
include cyber threats, distribution disturbances, technology and demonstrated the need for visibility.
government policies, demographic changes in the Companies worldwide are moving towards practices for
workforce. digitalization across supply chains, which include sourcing,
production process, supply chain configuration,
While shippers and their logistics providers adjust to optimization, data analytics and customer relationships,
market demands and capacity changes, it usually takes not collaborative tools for communication between suppliers,
less than 18 to 24 months or more before the supply chain distributors and customers. The key goals of technology
reaches balance. Supply chain shocks affect each player in adoption within supply chains are support of circular
the supply chain. For example, during the COVID-19 economy and reverse logistics. For example,
pandemic, it has been common to observe a shift from ca. implementation of robotics together with WMS & TMS can
50% of the consumer dollar spent at home and ca. 50% decrease unnecessary activities with low added value.
away to the structure of ca. 80%-20%, which created shifts Omnichannel logistics that accelerated during the
along the supply chain. Flexibility on labeling and pandemic should be a new standard for the logistics market
packaging enabled transportation from a bulk environment with end-to-end visibility, dispatch management and route
to retail, international trade, or vice versa. optimization.
Figure 13: Impacts of COVID-19 pandemic on Singapore’s supply chain
Disruptions such as COVID-19 also pose significant delays
within supply chains. For example, in June 2021, a COVID- Vanishing retail turnover
19 outbreak significantly decreased volume at the Yantian (-15 index points y-o-y to 80.5 in 2020
port in China and, in August 2021, led to the partial Singapore Retail Index)
shutdown of the world’s busiest port, the Ningbo-Zhoushan
port, in China. Looking at air cargo, another COVID-19
Fluctuations in freight volumes
outbreak resulted in the suspension of freight operations
(Slight drop of 1% in Singapore’s container
at Shanghai’s Pudong International Airport in August 2021.
throughput to 36.87 million TEUs in 2020 after
According to NTT Data, 42% of the global supply chain is
all-time high of 37.2 million TEUs in 2019)
represented by Asia. Therefore, any disruption in this
region leads to a substantial impact on the global supply
chain. Prolonged anti-pandemic measures also continue to Major industries hit hard
severely impact supply chains. For example, it is ten times (-3% in Singapore’s manufacturing GDP to
higher to send a container from Asia to Europe in November 96.33 billion Singapore dollars in 2020 from
2021 than in April 2020. 99.36 billion Singapore dollars in 2019)

Political and regulatory uncertainties worldwide are also

impacting supply chains. Trade disputes, mainly with China, Increased demand for certain products
have led to disruptions in the global supply chain and shifts (As of February 2021, increased demand for
in manufacturing locations. For instance, Australia’s recent certain products was the leading result of the
geopolitical hostilities with China, the country’s major COVID-19 pandemic, which impacted
import partner, hampered supply chains in chemicals, operations of ca. 38% companies within supply
energy, and water treatment. Shipping costs increased by chains in Singapore)
almost 300%. COVID-19 constraints in trade compounded
ongoing political disputes. Disruption of global supply chain
(As of February 2021, disruption of global
According to the World Bank, the global economy is supply chain due to the COVID-19 pandemic
expected to stage its most robust post-recession recovery impacted operations of ca. 31% of companies
in 80 years in 2021. As a result, those within the supply within supply chains in Singapore)
chain need to develop new strategies to meet shifting
Source: Maritime and Port Authority Singapore; Singapore Department of Statistics; Bastian Consulting
7
Technology as a Tool for Supply Chain Sustainability

To achieve efficiency, logistics operators invest in retrieval systems, smart inventory counting, intelligent
expanding the breadth and depth of logistics optimization robotic sorting, predictive and prescriptive maintenance,
technology. The evolutionary expansion of OMS, TMS & predictive and prescriptive fleet management, dynamic
WMS products improved the value proposition for logistics route optimization, autonomous last mile delivery,
providers. While OMS, TMS & WMS products can be tailored autonomous last yard delivery, optimized documentation,
for each particular logistics operator, most 3PL operators smart lockers, virtual assistants, connected trade
are mainly looking at such features as scheduling, planning, platforms, smart billing, costing & reconciliation. Assessing
booking, order tracking, inventory management and billing. the state of 14.0 industry development in Singapore,
In addition, more 3PL operators are focusing on the logistics companies are at different stages in their
implementation of control tower visibility (visibility, digitalization journeys. The type of technology solutions
tracking & asset management) in the future. used varies on strategic priorities and prospective
competitive advantage.
While increasing use of OMS, TMS & WMS solutions among
logistics providers have already become a widespread In Singapore, SMEs typically have a limited digital vision
trend, the adoption of industry 14.0 is going to be a and financial resources. Therefore, Singaporean SMEs
defining factor for the sustainability of supply chains. 14.0 mainly use WMS, TMS and other simple optimization tools
technology solutions include automated storage and for route planning. Due to cost barriers, these solutions di-
Table 4: Key technology solutions sought after by 3PL operators in 2021 and demand forecast for 2022

2021 2022
Technology
% reported by shippers % reported by shippers

Control tower visibility (visibility, tracking & asset management) 37% 60%

Transportation management (scheduling) 72% 51%

Transportation management (planning) 69% 51%

Cloud-based solutions 23% 49%

Transportation sourcing 51% 40%

Warehouse/distribution center management 51% 38%

Advanced analytics and data mining tools 27% 38%

Web portals for booking, order tracking, inventory management, and billing 40% 36%

Supply chain planning 35% 30%

Customer order management 29% 30%

Customer relationship management (CRM) 17% 28%

Global trade management tools (including customs processing and import/export documents
17% 26%
management)

Distributed order management 29% 21%

Tard management 27% 21%

Network modeling and optimization 45% 19%

Warehouse automation 27% 17%

Radio-frequency identification (RFID) 9% 13%

Blockchain 8% 9%

Robotic process automation (RPA) 12% 9%

Wearables (biometrics, health & safety, etc.) 9% 2%

Source: Singapore Institute of International Affairs

8
Technology as a Tool for Supply Chain Sustainability
Figure 14: 14.0 industry technology adoption curve

Artificial Intelligence (AI) Intelligence

/Machine Learning (ML)

Big Data Analytics

Robotics & Automate

Automation

Blockchain
Connect
AR/VR MNCs

Cloud & IoT

Record
WMS, TMS, LLEs
(Legacy Systems) SMEs
ERP, etc.

gitize mainly a part of work, leaving operations manual and Table 5: 14.0 technology solutions by logistics sector
dependent on human intervention. Logistics players with
better financial capabilities, LLEs and MNCs, focus on the Sector 14.0 technology solutions
adoption of IoT, cloud, blockchain, AR/VR, robotics to Smart inventory counting; picker to parts &
partially automate processes and operations. Lastly, more parts to picker automated storage and
Warehouse
MNCs aim to fully digitize operations to achieve centralized management
retrieval systems (AS/RS); intelligent
management of operations led by a CIO and CTO. At the robotic sorting; predictive & prescriptive
maintenance
last stage, MNCs are able to stay ahead of supply chain
disruptions by leveraging on big data and artificial Predictive fleet management; dynamic route
intelligence for predictive and prescriptive capabilities. Transportation optimization; autonomous last mile delivery;
autonomous last yard delivery
Going forward, more logistics companies in the early stages Freight Smart billing; costing & reconciliation;
of digital adoption are going to move up the digitalization forwarding connected trade platforms
curve (Figure 14) in line with the development and
Smart lockers; round-the-clock customer
entrance of new 14.0 technology enablers. In Singapore, Sales & customer
service via virtual assistance; optimized
the adoption timeline for 50% of these companies is service
documentation
expected to stand at 5 years (Source: Ernst & Young).
Source: Ernst & Young

Connect with us
Twitter: https://twitter.com/vynncapital
LinkedIn: https://www.linkedin.com/company/vynncapital
Email: [email protected]