Logistics is one of the largest industries in Vietnam, accounting for around 23% of GDP. Whilst this huge figure is partly due to the structure of Vietnam’s economy as a heavy producer of manufactured goods and agricultural products, it is higher than the benchmarks of other Southeast Asian countries with a similar economic structure.
“Transportation costs are especially high in Vietnam because of multiple inefficiencies” explains Ta Nguyen, a Logistics manager at Thao Nguyen factory in Vung Tau. “One of the key reasons is the stretched road network causing slower travel due to traffic and poor road quality. The other key reason is market fragmentation, meaning I have to work with many different brokers and agencies to find the right transport”.
LOGIVAN is the brainchild of Cambridge Graduate and former Goldman Sachs analyst Linh Pham, who realised the need for innovation in the sector when working in business development at a Long An manufacturing company.
“Seeing how low the utilisation of the trucks was” Linh explains “inspired me to start probing into the problem. I realised there were a lot of problems in the road transportation sector that would benefit from a technology solution. For example, 70% of trucks return empty because drivers cannot easily find cargo around their destination location to bring back”.
Within three months, LOGIVAN secured seed funding from the Singapore based Venture Capital firm led by former Sequoia partner Yinglan Tan, which it has used to improve its technology and grow its driver network to 5,000 trucks. LOGIVAN’s technology is advised by Mr Thuan Pham (Uber Chief Technology Officer) and in July, it won Best Startup at RISE Pitch Battle – the largest technology conference in Asia. Recently in August LOGIVAN announced a Series A funding round led by Ethos Partners, Insignia and VinaCapital Ventures.
By giving truck drivers access to a mobile app, LOGIVAN is able to connect them directly with jobs relevant to their location. The platform will eventually unify a million truckers and thus able to reduce truck empty return rate on a large scale (which is the root cause of high logistics costs in Vietnam).
Linh tells me of her vision for LOGIVAN. “We want to give truck drivers and truck owners the ability to control their own work and schedules. We are using our technology to fill empty returns, so truck drivers can boost their income and work on more favourable terms.
“But LOGIVAN offers the biggest benefit to shippers and cargo owners. We have reduced prices on many common routes to lower levels than traditional brokers can offer. LOGIVAN also offers transparency, where cargo owners can clearly avoid many brokerage layers (whether internal or external) and save costs. Clients can track their cargo so the team at the destination can be ready to unload and complete the paperwork. For businesses, trucking has never been more simple and convenient with LOGIVAN technology.”
Learn more about LOGIVAN: https://www.logivan.com/nhung-diem-moi-ve-thi-truong-logivan-dang-huong-toi/