A number of months ago, I saw a Bloomberg interview of two young enthusiastic gentlemen who were the co-country directors of this relatively new multinational company called Transportify. As I was listening to the interview of Noel Abelardo and Paulo Bengson, of what Transportify was all about, I thought it was a great idea. The easiest way to explain it is if you have Uber and Grab as an app to transport passengers, you have Transportify to transport goods and packages.
After a year since launch, more than 5,000 drivers/operators have signed up with Transportify, which is a testament to the growing popularity of delivery service on demand. The advantage of this delivery-service app is that there is no gray area in terms of the government transport franchise required, which is “truck for hire” and there is no moratorium for this category, making this business totally legal.
I have had a number of opportunities to meet and discuss with both Noel and Paulo about the business possibilities with Transportify and it seems that everyone is a winner. Customers, driver/operators and even logistics companies all benefit from this delivery-service app. Maximizing the efficient use of resources enables everyone to profit from this arrangement, which is really nothing more than a customer placing a delivery request on the Transportify app which is then broadcast to the registered drivers who then respond to pick up and deliver the package or packages, which includes furniture, appliances and other goods.
As a customer, you are able to send practically anything (as long as it is legal) anywhere within driving distance at a reasonable rate on a timely basis. It does not matter if you are sending packages for personal purposes or you are a small business that makes infrequent shipments to your customers or a large corporation that needs to make regular deliveries frequently. With the drive of this administration to end contractual labor, this system is a way for businesses not to have to hire their own delivery crew. It also allows businesses, big and small, to have a more efficient delivery system. Instead of having their own fleet of delivery trucks, they can now just call on demand and not have to maintain their own delivery fleet. This allows companies to save on the downtime when the delivery trucks, drivers and helpers are not doing anything and just waiting for the next delivery to be made.
For the operators that have signed up with Transportify, this is a legitimate business opportunity for themselves when they are also the driver and a logistics business when the operator has a fleet signed up to make deliveries. Looking at their actual examples, operators who invest in a brand-new aluminum delivery van, could easily have a payback period of less than one year, something that would not be possible with Grab or Uber, and without the legal risk. At the moment, it seems that there is still more demand than supply of delivery vehicles and the plan is to double the fleet in 2018.
Hopefully, this encourages and establishes more Filipino entrepreneurs who can be part of the solution to our problem with unemployment and underemployment.
What about those logistics companies with existing fleets of delivery trucks? While you would think that these companies would not welcome delivery apps like Transportify, it is quite the opposite. Many of these companies have now signed up with Transportify and are now making deliveries for Transportify during the idle time of their trucks and drivers, thereby maximizing the utilization of their resources. This leads to better profitability that everyone loves.
So what are the challenges facing this new industry? The biggest one is really the availability of Euro 4-compliant vehicles which are now required in the Philippines under the Clean Air Act for first-time registration with the Land Transportation Office starting January 1, 2017. Major brands have already announced the phase out of their most popular models in the light-truck category since they are unable to comply with the Euro 4-emission requirement. Fortunately, Universal Motors Corp. has the BAIC Bayanihan H5 cab & chassis Euro 4 Turbo Diesel that comes in the 18 seat passenger and aluminum-van version that has a higher torque and larger capacity than the leading brand in this category, and if I may add, at a cheaper price with a 100,000-kilometer per three-year warranty.
If you are looking to become an entrepreneur or simply need a better way to make your deliveries, get in touch with Transportify or BAIC Philippines or send me an e-mail.
This could be the monumental event you need in improving your life.
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