Despite challenges from a trade war and an unfavourable global economy, embracing artificial intelligence (AI) and optimising logistics costs with multimodal transport can help Thailand become a hub of cross-border e-commerce, according to online entrepreneurs.
Mike Li, chief executive of UniEx Expo Pte in Singapore and a co-organiser of China Shenzhen International Logistic and Supply Chain Fair, said the company selected Thailand to host Asia DigiCommerce Services Xpo for the first time.
The trade fair brings together key Asian e-commerce players to explore the latest innovations, share insights, and foster connections in this growing area.
The event is scheduled for June 11-13 at Queen Sirikit National Convention Center.
Thailand has a strategic location in Southeast Asia and regional cross-border e-commerce should continue to grow over the next 2-3 years, he said.
Asian e-commerce tallied US$2.3 trillion last year and is expected to grow by more than 10% annually until 2028, said Mr Li.
He said the development of digital payment systems, AI and blockchain technology form the foundations of the next wave of e-commerce.
DIGITAL TRADE INFRASTRUCTURE
Ally Wang, secretary-general of the Shenzhen Cross-Border E-Commerce Supply Chain Service Association, said there were three major transformations in the e-commerce domain.
The first was when the logistics system changed from a "channel" into a "strategic asset", as logistics has become a core factor affecting user experience in e-commerce, she said.
The second transformation was when online platforms were transformed from "traffic entrances" to "ecological engines" that influence logistics and supply chains, evolving into digital trade infrastructure, said Ms Wang.
Compared with Shopee and Lazada, the TikTok Shop platform has risen rapidly via its live e-commerce.
Amazon built a regional warehouse in Singapore to compete for the business-to-business cross-border market.
The third transformation was when the technology changed from a "tool application" to the "gene" of the e-commerce world, she said.
Technological advancement, especially AI, has penetrated the entire life cycle of the trade, from product R&D to fulfilment and recycling, said Ms Wang.
Recently Amazon, Microsoft, TikTok and Alibaba have all made significant investments in Thailand to build regional data centres, based on their optimism in the digital economy in Southeast Asia, she said.
Export opportunity
Stephen Bao, chief operating officer of KEX Express (Thailand) Plc, said the company was acquired by S.F. Holding, a leading logistics company in China.
This integrated KEX with advanced technologies and expanded its business operations, with a focus on cross-border e-commerce opportunities between China and Southeast Asia.
The Thai e-commerce market rapidly expanded, spurred by the pandemic with more consumers purchasing products via digital platforms.
SF is a leader in logistics innovation, using drone delivery trials, technology-driven route planning, and AI-based data models to optimise network efficiency.
Mr Bao said SF plays a vital role in supporting Thai agricultural exports by streamlining logistics from farm to consumers, particularly to the Chinese market, improving profits for local farmers.
"Looking ahead, SF aims to enhance its services by leveraging big data and AI to optimise delivery networks and improve customer experience," he said.
For the cross-border e-commerce market, policymakers should make customs processes smoother and implement more digital systems to speed up the whole delivery cycle, said Mr Bao.
Thailand also needs more bonded warehouses and should offer tax incentives so the delivery lead time is faster and more reliable, he said.
Mr Bao said the logistics industry faces challenges in balancing costs and service quality. Customers expect fast and cheap delivery, but rising labour and fuel costs as well as difficult working conditions put pressure on the providers.
"The industry must find ways to optimise costs without sacrificing service," he said.
Success will depend on how quickly companies adapt to market changes, optimise costs, and ensure a sustainable business cycle for all stakeholders, including buyers, sellers and workers, said Mr Bao.
While AI can replace routine administrative tasks, such as email responses and document handling, last-mile delivery still requires human interaction, he said.
However, the use of robots for document delivery in China demonstrates AI's potential, said Mr Bao.
In Thailand, full adoption of AI and autonomous delivery systems will take time, especially considering challenges such as local traffic conditions, he said.
THAILAND HUB
Nattapume Pavaratn, president of the Warehouse Silo and Cold Storage Business Association, said Thailand is becoming a hub for cross-border e-commerce, particularly between regional countries and China.
To meet the growing demand, logistics service providers should develop solutions to address the needs of both buyers and sellers across borders, while ensuring cost efficiency and high-quality services, he said.
The focus should be development of logistics infrastructure in Thailand to support both domestic and cross-border e-commerce, said Mr Nattapume.
The integration of multimodal transport, such as the high-speed railway connecting China and Laos, combined with efficient last-mile delivery in Thailand is central to creating a seamless logistics model, he said.
Collaboration among all players in the e-commerce system is essential to minimise underutilised assets, said Mr Nattapume.
"Instead of competing, companies should work together to create a more effective system," he said.
AI in e-commerce
Kornpong Nualsanit, deputy country manager for Thailand at Alibaba.com, said there are two challenges for businesses entering the Thai market: the language barrier and local regulations.
The Thai language and cultural nuances require strong localisation efforts, as Thai consumers tend to communicate indirectly when making decisions, he said.
This makes it essential for businesses to adapt their marketing strategies to meet local preferences, with a localised team making the process easier, said Mr Kornpong.
Another obstacle is navigating through changing laws and regulations. Many countries in the region are tightening rules to protect local companies, he said.
Businesses need to adapt to these changes to succeed in the region, said Mr Kornpong.
Looking forward, AI is expected to play a major role in the future of e-commerce regionally, he said.
Sellers who leverage AI tools to generate content, answer customer inquiries, and streamline processes are likely to outperform those who do not, said Mr Kornpong.
As AI evolves, it will increasingly support businesses in e-commerce, helping them become more efficient and customer-oriented. The future of e-commerce in the region depends on how quickly businesses can adapt to new technologies, local regulations and cultural differences, he said.
Tech empowers loyalty
Junning Wan, retail business director of Huawei Cloud Global Ecosystem Asia-Pacific, said more people are shopping on the internet, driving online retail sales growth in Southeast Asia.
Online retail sales account for only 10% of total retail sales in the region and 11% in Thailand, much lower than the global average of 19% and 33% in China, he said.
This demonstrates substantial growth potential in the region, said Mr Wan.
The Southeast Asian e-commerce market is adopting diverse business models, with social media marketing and influencer impacts growing rapidly, he said, as well as live-streaming e-commerce.
However, challenges in regional e-commerce include high logistics costs and insufficient infrastructure, said Mr Wan.
Businesses can engage consumers through targeted social media ads and the use of AI-generated content technology to create marketing content and enhance brand power, he said.
