The Freight Debate
Staff contributor: Heather Rushworth
In today’s convenience based marketplace, where conserving energy, time and resources is vital in building the most efficient supply chain, logistics specialists everywhere must carefully weigh out their delivery method options. Which leads to a simple question, but one rarely discussed in length: what mode is truly the superior system in transporting freight, trains or trucks?
Structurally, a number of elementary design factors contribute to the superior energy efficiency of the train over the truck. For one, a train’s steel wheels smoothly join with the steel of the railway, and thus omit very little kinetic friction. In opposition, a truck’s thick rubber tires emit heavy static friction when interfacing with asphalt, forcing the engine to consume more fuel to maintain momentum. Also, the slower speed of trains, while ultimately extending the overall delivery time of freight, actually greatly improves fuel consumption, as it cuts down on the aerodynamic drag caused by moving heavy masses at fast speeds.
So ultimately, a train has less aerodynamic drag than a truck, making it more fuel efficient, as the engine does not strain to overcompensate for its loss of energy to inertia. While the difference between fuel costs does not differ wildly in short distance trips between the train and the truck, the energy efficient train does pay off in medium to long distant routes.
However, in today’s fast- paced marketplace, where time is money, companies may find a train’s lag in delivery time burdensome. And it isn’t just the train’s slower speed that delays the chain of supply, but also the logistics of loading and unloading freight onto the train. Ultimately, a truck’s effortless accessibility is less of a hassle to load and unload. And with cargo requiring a quick turnaround like fresh produce, time delays can significantly cut profit margins. Also, obviously, trucks are not restricted to the infrastructure of a railway, which makes them the optimally flexible option when it comes to comprehensive delivery.
Perhaps the truth lies not in Trucks vs. Train, but rather, how we can bridge these two sectors together into one powerhouse network. If the future of industry is one of customizable options, then the key to the most efficient delivery method comes in synchronizing the benefits of the two, focusing on how these two equally valuable, but ultimately unique systems of delivery can be interfaced in the most efficient way.
Cainiao Network Launches Customer-Centric Logistics
As the logistics division of the Alibaba Group, Cainiao Smart Logistics Network has decided to provide its Southeast Asian customers with unsurpassed service during its annual shopping festival. Based on customer feedback surveys, the company will expand its real-time customer service support and speed up delivery times. ‘By expanding and deepening our services, we aim to provide a stronger logistics infrastructure that can bolster the booming eCommerce sector, support merchants’ expansion into new markets and diversify retail options for consumers’, said Chris Fan, Head of Cross-Border, Singapore, Cainiao Network.
Who Is Cainiao?
According to TIME Magazine, Cainiao ‘is far from a typical logistics firm’. The company controls an open platform that allows it to collaborate with 3,000 logistics partners and 3 million couriers. This means that merchants can choose the least expensive and most efficient shipping options, based on Cainiao’s real-time logistics analytics. The company’s goal is to ship packages anywhere in the world in under 72 hours—and for less than US$3.00.
For countless small business owners around the world, from coffee-growers to textile-weavers, this could change everything. Usually, it costs about US$100 to ship a DHL envelope from Shanghai to London in five days. Cainiao aims to change that. Said its CEO Wan Lin: ‘The biggest barrier to globalisation is logistics’.
What’s Part of the Upgrade?
Throughout the Tmall festival, Cainiao’s logistics upgrade will be divided into four critical segments:
- Real-time customer service support. Cainiao has launched a direct WhatsApp channel for customers to receive logistics updates and ask questions.
- Expansion of air freight parcel size and weight limits. Packages can now be up to 30 kilograms or 1-metre x 1.6 meters to help ship large items such as furniture.
- Daily air and sea freight connections. Shipping frequency will almost double to seven times weekly to maintain resilience and efficiency.
- Compensation for lost or damaged packages. Customers will be reimbursed up to RMB 2,000 (US$311).
Where is the Company Headed?
From June 1st to June 20th, the finale of Tmall, Cainiao will ensure that its customers feel confident in the company’s ability to deliver their packages. Despite global shipping delays due to COVID, the show will go on. Said Fan: ‘This series of customer-centric logistics upgrades reaffirms our goal of pursuing value-added services to enhance customers’ shopping experience while mitigating challenges posed by external factors’.
Furthermore, Cainiao has recently expanded its Southeast Asian operations, achieving revenue growth of 68% year-over-year. In Malaysia, the logistics operation has partnered with BEST Inc. and Yunda; in Singapore, the company has partnered with Roadbull, Park & Parcel, and the Singapore Post. And if its recent measures help retain and grow its customer base, the company will be well-poised to lead the industry in resilient and customer-centric global logistics. ‘COVID-19 made everyone realise how important the logistics infrastructure backbone is’, said Wan. ‘And it gave us a peek at what Cainiao should look like in three years’.