mai hien

Foreign e-comerce firms accept losses in VN
Friday, 10 August 2018 01:34

Many foreign giants have invested in Viet Nam’s leading e-commerce platforms even as they incur big losses, as they continue to see the long-term potential of the country’s rapidly expanding online shopping sector.

With all the ingredients for a thriving e-commerce economy – a young population, rising disposable incomes and growing internet and mobile adoption – the Vietnamese e-commerce market is expected to maintain an annual growth rate of 25 per cent to reach US$10 billion in the next four years, according to the Ministry of Industry and Trade’s E-commerce Department.

However, the Vietnamese e-commerce market is still in an early stage of development, so it poses major challenges to players.

According to industry insiders, companies need to pump significant funds into their e-commerce business to carry out tasks from sales and marketing to warehousing and logistics, so profits are easily eaten up. Also, many platforms suffered losses from special discount offers and promotion campaigns to snag new customers.

E-commerce companies have spent aggressively to gain market share, intensifying the competition and the short-term losses, reported.

Despite a loss of VND164 billion (US$7.1 million) in 2016 and more than VND600 billion last year, Shopee has continously received more than VND1.2 trillion in investment from its parent company, Singapore’s Sea Limited (Sea), in the first half of this year.

Shopee has pumped money into promoting its platform with plenty of discounts, free nationwide shipping service, training for sellers and other promotions.

After suffering a loss of some VND600 billion in 2017, Tiki got additional investment of some US$50 million from China’s second largest e-commerce group and some other investors early this year.

Tiki has also planned to call for more investment worth some $50-100 million next year, which will continue to take part in. The investment can be considered a move to race with Alibaba in Viet Nam’s e-commerce market after Alibaba acquired Lazada several years ago.

To gain large market share in Viet Nam, Alibaba’s Lazada ran up accumulated losses of more than VND2.7 trillion in 2015 and 2016. With the fiercer competition in the market last year, Lazada’s accumulated loss could reach nearly VND4 trillion when all the accounting for 2017 is complete, reported.

According to trade expert Vu Vinh Phu, foreign investors are continuing to increase their presence in Viet Nam’s e-commerce market despite losses, as their current goal is to attract customers, stretching their influence in the market.

Nguyen Manh Dung, head of the Vietnam and Thailand Office under CyberAgent Ventures, told local media that e-commerce requires a long-term investment, and investors could start to earn profits after five to 10 years of operation.

Even Amazon in some markets has only started making a profit after 10 years of investment, according to Dung.

With fierce competition in Viet Nam, it is likely to take e-commerce firms some time before they start reaping the rewards, he added.

Online retail makes up only 1 per cent of the total retail market in Viet Nam, compared with the 14 per cent in the US and China. There is still a long way to go for the Vietnamese e-commerce market to reach its peak, so foreign companies like Alibaba, and Sea have invested in the country early to get ahead of the curve, experts concluded.

K Line settles bankruptcy with APL Logistics
Wednesday, 08 August 2018 02:55

Kawasaki Kisen Kaisha (K Line) has settled a long running lawsuit with APL Logistics over slanderous allegations that the Japanese carrier was close to bankruptcy a couple of years ago.

In September 2016 employees of APL Logistics sent erroneous emails to customers, claiming K Line was close to following Hanjin Shipping out of business. K Lines responded, filling a lawsuit in Tokyo, demanding damages from APL Logistics and its parent, Kinetsu World Express.

K Line said in a release that the company has now reached an "amicable settlement" without stating any financial details of the settlement.

Cosco picks ABB turbochargers for new mega container ships
Monday, 06 August 2018 03:26

Cosco Shipping Lines has selected ABB turbochargers for all main and auxiliary engines on all six of its 21,000 teu Universe series container ships to bring about optimal performance and fuel efficiency for one of the world’s largest container ships, ABB said in a press release.

ABB Turbocharging is a key strategic partner and will equip the turbochargers on all six vessels being delivered for the Universe series by 2019, joining hundreds of ABB turbochargers already in operation across the extensive Cosco Shipping Lines fleet.

The flagship vessel in the series, Cosco Shipping Universe, was delivered in June 2018 by Jiangnan Shipyard and is equipped with three ABB A180-L two-stroke turbochargers to match the diesel main engine and four ABB TPL67-C33 4-stroke turbochargers to match four auxiliary engines.

ABB Turbocharging md Oliver Riemenschneider said: “We are proud to support Cosco Shipping Lines, with premium ABB turbochargers selected for all of the main and auxiliary engines across the six mega container ships in the Universe series, including the record-breaking Cosco Shipping Universe recently delivered.”

He added: “The ABB turbochargers on COSCO Shipping Universe will support maximum performance and fuel efficiency, in addition to contributing to COSCO SHIPPING Lines pursuing green shipping practices for long-term success. We foresee the ABB turbochargers on the forthcoming mega container ships in the Universe series will contribute similar viable operational gains.”

Key benefits for ABB’s A100 series include compliance with IMO Tier II and Tier III emission limits; reduced fuel consumption; high operational flexibility, reliability and availability; long intervals between inspections, routine maintenance and overhauls; absolute operational safety with rigorous testing and reduced engine room noise.

Cosco Shipping Universe is the Cosco Shipping Lines fleet’s flagship, and is expected to serve the Far East to Northwest Europe trades, becoming the new messenger and business card of the 21st-Century Maritime Silk Road.

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