Cross-border e-commerce became a hit during the pandemic. According to the research, e-commerce in the Middle East was expected to exceed 27 billion US dollars by 2025.
The market is growing bigger, but more problems await. Logistics is the biggest obstacle hindering the development of e-commerce in the Middle East.
Dubai has the largest port in the Middle East, and sea freight shipping has developed. However, local delivery still needs improvement.
Two problems are hindering the development of the local delivery. The first is the unclear address problem. Besides, the local house number and address are very complicated. Some people will go to the post office to buy the POBOX: XXXX( X stands for a number) mailbox number.
However, residents generally do not buy P.O.BOX. When they write the address, they describe it unclearly, resulting in a low package acceptance rate. This problem is the most obvious one in Saudi Arabia.
Apart from the address issue, local delivery also undertakes the payment function. Compared with online payment, people in the Middle East prefer cash on delivery. Still, cash on delivery is an inefficient payment method.
If sellers choose cash on delivery as the primary payment method, the return rate is often high. Besides, the returned goods need to be rearranged and stored, and sellers need to pay for the cost. Besides, sellers also need to pay the cost of COD service and bear the risk of the customer not paying for the goods.
Many problems still need to be solved urgently, such as the low delivery efficiency of carriers, high package lost rates, long payment cycle, etc.
Small and medium-sized logistics companies don't have a complete logistics network. That means they have to work with other logistics companies to deliver the package to the recipient.
That leads to a serious problem. The recipient can't track the package status because of this. Not to mention how low the customer experience satisfaction is.
In terms of local delivery services in the Middle East, there are several well-known logistics companies.
The Best Middle East Delivery Companies
Aramex is a well-known middle east shipping services provider with a history of 35 years. According to Aramex's report, they handled around 80% of local deliveries in the Middle East.
Aramex's advantage lies in its extensive data collected in Arab countries for more than 30 years. Through its system, Aramex can match the actual address of the receiver and then deliver the package based on the name, phone, email, etc.
Aramex employs the locals to handle the last-mile delivery to solve the unclear address problem. The local people are more familiar with the local area and communicate more smoothly, reducing the rejection rate.
Fetchr, a Dubai-based company founded by Idriss Al Rifai, announced in May 2017 that it had received $41 million in Series B financing. Fetchr's primary competitiveness is to have a set of "Mobile Internet Logistics Solutions."
Fetchr believes that Fetchr's carriers can deliver packages to customers correctly through Google Maps and other GPS positioning methods after downloading and using Fetchr's application. Most recipients' address is unclear in the Middle East. However, more than 80% of people in the Middle East own a smartphone.
Fetchr's middle east shipping services have covered many countries in the Middle East, including the United Arab Emirates, Saudi Arabia, Oman, etc. It provides same-day and next-day delivery services for both business and individual customers. For business customers, Fetchr allows them to schedule multiple orders at a time. Fetchr also partners with UPS and FedEx to deliver orders from the US and undertakes the package delivery businesses from DHL in the Middle East.
3. Q Express
Souq, the largest local e-commerce company, has encountered the challenge of last-mile delivery since its establishment and has been looking for solutions in local delivery.
Q Express is Souq's middle east delivery company, specializing in providing last-mile delivery services for Souq. Q Express currently delivers all orders placed on the Souq platform. Souq buyers can input the order number to track the package status on Q Express.
Q Express has multiple shipping offices to facilitate the delivery and return of goods in the Middle East. Q Express's advantage is providing cash on delivery (COD) services that most logistics companies do not offer. In addition, all Q Express carriers carry PDA devices to update the delivery status of goods at any time.
The founding team of iMile is from China. The team is based in Dubai, focusing on providing last-mile delivery for Chinese e-commerce sellers, focusing on solving the problem of cash on delivery. The core competitiveness of iMile is to provide a set of tailor-made solutions for Chinese sellers to go overseas to the Middle East, which understands both China and the Middle East.
iMile has overseas warehouses and a delivery team in Dubai, providing value-added services, such as air freight, local delivery, forwarding, and pre-delivery screening. iMile offers same-day delivery in Dubai, Sharjah, and Abu Dhabi.
iMile has a complete logistics system that supports API integration. The delivery man can use the delivery app to update the order status in real-time.
Both individual and business customers can track the detailed status of their packages. Besides, the system supports financial statements auto-generation. Business customers can use it to reduce lengthy manual reconciliation.
Souq and Amazon acquired Wing.ae in 2017. It is an online B2B service platform that connects e-commerce businesses and logistics companies. Unlike the logistics companies mentioned earlier, Wing.ae itself does not have carriers.
This platform mainly handles small tasks from envelopes to standard packages. The service is not limited to the Souq platform itself and is open to all merchants and shipping companies.
Founded in 2015, OneClick is a platform created by Hassan Hallas that connects drivers with businesses that need delivery services. The platform currently has delivery management, GPS location tracking, route optimization, and automatic message notification. Its entire delivery payment process is built on the Internet.
At the end of December 2017, OneClick announced that it had received investment from MEVP. According to the average investment amount of MEVP, the investment amount should be more than millions of dollars.
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