LAZADA Philippines is eyeing to build a bigger facility in Clark, Pampanga and four more warehouses in different regions in the country in the next three to five years to support its growing business in the Philippines.
Lazada Philippines Chief Executive Officer for Logistics and Operations Juan Pavez Spencer told reporters on Sunday the rise of e-commerce in the country demands that the company invest more heavily in backend operations.
“We’ll open more facilities in the next three to five years starting by this fifth generation warehouse in Clark. But also we have… warehouses which cater to high velocity scale use that are located in different regions. Today we have one in Cebu, one in Davao, and we are planning to open one in Central Luzon, in North Luzon, in North Mindanao and in some other populated island in Visayas,” he said.
Mr. Pavez said its 54,000-square meter warehouse in Cabuyao, Laguna is a fourth generation facility, and is currently Lazada’s biggest warehouse in Southeast Asia. A fifth generation warehouse, he said, would be double the size of the one in Laguna and would have smarter algorithm to optimize processes inside the facility.
“We have this vision of coupling e-commerce and logistics and to actually develop a lot of internal contours on the logistics process. It’s very important for us. And we believe that’s the key differentiator for us, especially in complex countries like the Philippines where you have the mix of end-of-year peak sales and typhoon seasons, and it’s also quite congested as well,” the logistics head said.
He noted Lazada’s forecast is that in three to five years, e-commerce in the country would record exponential growth, and Lazada is doing its best to prepare for that scenario.
“Our forecast is that the e-commerce in the Philippines will not hit just 1.5% of the retail, but will even go up to 6% or 7% in the next three to five years,” Mr. Pavez said.
He said that in a country like the Philippines which is made up of thousands of islands, Lazada’s goal of achieving same-day or at most two days delivery upon online order could be challenging. That’s why they are heavily investing now in establishing more warehouses around the country to reach the most number of Filipino customers.
At present, Lazada said it records more than 28 million monthly site visits. Its pool of sellers is also made up of more than 30,000 sellers from international brands to micro, small and medium-sized entrepreneurs. — Denise A. Valdez