In addition to satisfying the demand of consumers, time is considereda major problem when consumers now desire to receive their orders in a short timein a few hours or 1-2 days; therefor
INTRODUCTION
S YSTEM REQUIREMENT
● Overview of E-logistics in the World:
With the rapid growth of electronic commerce (E-commerce), there is an enormous increase in the demand for customers that are difficult to predict and sensitive to price and service levels [Wang et al, 2004] with shrinking shipment size This development also shifts a significant change in the presented logistics which is now becoming E-commerce Logistics.
E-commerce Logistics (or E-logistics) is presented as logistics concepts applied through Internet use and it means necessary processes for supporting the acquisition of material, warehousing, and transportation and enables distribution through routing optimization with inventory tracking Song and Hu [2004] studied the differences between traditional and e-logistics and the results of their research are summed up in Table 1.1:
Table 1.1: Difference between traditional and E-logistics
Source: Song and Hu [2004] lOMoARcPSD|39211872
Having mentioned above, the growth of e-commerce leads to a significant increase in shipped parcels in recent years, and the fact that the parcel service industry has become one of the fastest-rising segments of logistics services. However, to deliver the right parcel to the right place, the process of gathering parcels from different places and distributing them to the precise location also plays an important role in the parcel service industry This process is known as
Sortation and a place where all activities of this segment occur is known as Sortation Center (Sortation Hub), and its goal is to classify items according to their destination and move different items to the corresponding output ports [Tzu- si chen et al, 2020].
Some corporations integrate sortation segments in their distribution centers while others also open a specific sortation center The most stand-out company that we can mention is Amazon, which has extended its fulfillment centers by adding sorting centers that sort packages into zip code orders for faster delivery by the U.S Postal Service (UPS) Moreover, in Vietnam, the recent sortation center of Lazada in Binh Duong which is able to sort 1 million parcels per day has been observed as an important step forward in Vietnam’s E-commerce logistics industry.
● Overview of E-logistics in Vietnam:
In Vietnam, the concept of E-logistics is still new By comparing e-logistics with the traditional logistics field in Vietnam, we can see the biggest difference is that while most of the order processing and traditional logistics quotes in Vietnam are done manually, e-logistics wants the implementation of procurement and fulfillment handled by information technology Processes in e-logistics are automated to satisfy millions of orders per day, and delivery progress within 1-2 hours or in a day.
The Vietnamese e-logistics industry has experienced significant growth in recent years According to the Ministry of Industry and Trade, the number of e-logistics providers has increased from 50 in 2017 to over 3000 in 2022 The majority (89%) of these providers are domestic enterprises, with joint venture enterprises accounting for 10% and foreign enterprises making up 1%.
While a growing sector, the Lazada Logistics Park is not without its share of challenges E-commerce is developing more rapidly than ever, which goes hand in hand with the increase in the demand of consumers Albeit the fact that Lazada Logistics Park is one of the best sorting centers currently, it does not ensure that:
1 With the increase in the demand of Vietnamese consumers, can Lazada Logistic Park be still an effective hub in the future, especially when the customers’ behavior is changing unpredictably after the COVID-19 pandemic?
2 With the number of technologies now, is it possible to fulfill the need of customers after COVID–19 when e-commerce is developing rapidly? These are two principal problems relating to the relationship between the hub and consumers that we take into account.
O BJECTIVES
In this simulation project, we will use a simulation software – Arena to simulate the activities inside the sorting hub of Lazada After simulating the model of this sortation center, we desire our model to be able to illustrate performances and functions inside the center. lOMoARcPSD|39211872
Besides that, we want to demonstrate the relationship between the sortation center with e-commerce in general and with e-sellers (individuals or enterprises) in specific.
S COPE AND LIMITATIONS
In a practical sorting hub, the main activities around the hub are bringing packages after collecting from e-sellers along Vietnam for sorting processes into batches for delivery work later on, which can be a direct delivery to 4 Lazada receiving hubs located in Ho Chi Minh city (located in District 11, District Go Vap, District 1, and District 7 respectively) and then bring it to Ho Chi Minh City consumer’s doors.
The data of Lazada Logistic Park that will be used in this report is recorded as average in one day (which are: the sizes of parcels, the number of parcels arriving at the hub in one day, and the time difference between parcels) and comes from mainstream newspapers, published information on Lazada’s websites and practical observation from the enterprise.
A number of limitations in simulating a particular sorting hub that can be covered through are unable to access practical data and statistics that are practical and objective to the actual market’s situation Moreover, the narrowing of the market range is a noticeable detail in understanding and simulating the hub
The project lacks practical resemblance and time constraints limit the simulation process, resulting in a small sample size that is insufficient to represent the vast quantity of package flows encountered daily.
Difficulties in reflecting the entire project in an exact process are considerable due to the purpose of simulating the project and the missing needed information from the sorting hub Moreover, the data used in this project will lack accuracy since many data can only be observed by assumptions A noticeable detail is the weight scanners, in which parcels went through them during simulation cannot be scaled dimensionally due to the limitation of the computing system. lOMoARcPSD|39211872
SYSTEM DESCRIPTION
C ONCEPTUAL DESIGN
● Overview of Lazada Logistics Vietnam:
Lazada Logistics Vietnam, a member of Lazada Corporation, is the pioneer in Vietnamese E-logistics with the application of technologies in logistics activities, offers a diversity of logistics solutions, and is a credible partner of brands and e- sellers in Southeast Asia During the previous decade, the logistics networks of Lazada Logistics Vietnam have reformed the background of E- commerce With the target of offering comprehensive logistics services based on the technological foundation and continuous innovation, Lazada Logistics Vietnam always commits to improving and enhancing Logistics services, and providing customers with optimal, effective solutions With extensive space and bases in both
Ho Chi Minh and Ha Noi: Fulfillment Center and Sorting Center in Ha Noi; Fulfillment Center and Sorting Center in Ho Chi Minh, Lazada Logistics is able to fulfill orders efficiently throughout the country.
Lazada Logistic Park which was officially inaugurated on March 2023 It is located on 10 Street, Song Than industrial area, Di An City, Binh Duong province,and is possessed by the E-commerce company Lazada Logistics Vietnam.
Figure 2.1 Lazada Logistics Park in overview [1]
With the main purpose of supplying effective logistics services, Lazada Logistics Park has impressed by the recording of the ability to sort 1 million parcels per day and is the most modern logistic center in the province And thanks to modern and automatic technologies, the Lazada Logistics Park can enhance operational efficiency and mitigate labor costs Regarding the 99 percent automated sorting system, parcels can be quickly and accurately sorted and managed, thereby cutting down the delivery time "This new sorting center is not only a breakthrough in the development process of Lazada Logistics but also marks a milestone in the development of Lazada Logistics in the e-commerce logistics industry in Vietnam in general […].” (Vũ Đức Thịnh, CLO, Lazada Logistics Vietnam, VNS).
[1] VnExpress (2022, March 18) 10 năm thương mại điện tử Việt thay đổi nhờ công nghệ vnexpress.net.https://vnexpress.net/10-nam-thuong-mai-dien-tu-viet-thay-doi-nho-cong-nghe-
Figure 2.2 Automated system in the center
The Lazada Logistic Park operates by collecting parcels from E-sellers in Vietnam via container trucks These parcels are then transported to a sorting center in Binh Duong province, where they are organized based on geographical destinations Subsequently, packages are delivered either directly to E-buyers or to receiving hubs operated by Lazada Logistics or third-party logistics providers in Ho Chi Minh City, ensuring efficient and timely delivery to end consumers.
When the parcels are arrived at the sortation, at the inbound stage, there is a system of telescopic conveyors used for the unloading of parcels from trucks The parcels after that are moved in the singulators – a part of automated logistics and managed by reordering and allowing one parcel to come to the Dim-Weight Scanner at one time Lazada also uses DWS to determine the lengths of 3 dimensions and weights precisely and figure out the barcode effectively.
During the sorting stage, cross-belt conveyors operate in parallel to separate parcels into their designated delivery areas The upper conveyor handles larger parcels, while the lower conveyor processes smaller ones As parcels traverse the conveyor, an automated barcode scanning system captures their unique identifiers This information is transmitted to the central system, updating the parcels' status and ensuring accurate delivery.
Commerce, the parcels are moved to an outbound area where they have been ready to be delivered to the local hub (or directly to consumers) The sensors at each output entrance help redirect the conveyor when loading bags are full and notify the workers to manage them Moreover, auto-outbound functions ( updating the status of parcels) and mobile telescopic are necessary to load parcels into trucks, which will shorten the waiting time.
As the trucks arrive, parcels come into the inbound process, at which they are loaded on telescopic belts Their barcodes then are scanned for information, as well as weighed and measured their sizes After that, parcels are transferred to the sortation system for distribution to Lazada storage In the outbound sequence, the auto-outbound function takes charge of updating information on the general system, while parcels will be pulled into bags And these bags, once full, will be loaded on trucks to the 4 Lazada storages in Ho Chi Minh City.
● INPUT SEGMENT: When parcels on trucks arrive at the sorting hub, they will first come to the inbound process, where telescopic conveyor belts transfer parcels into the main hub for separation, distribution, and arrangement After that, since every parcel has a barcode for distinction, they will be scanned for In-Out status for the general system If there is a barcode that cannot be read, the parcel will be transferred to the management area for practical manual procedure, which must be done by hand These parcels are then rechecked for compulsory information such as destinations, phone numbers, etc., printed new barcodes, and sent back to scanners to read barcodes again If it can be read, parcels will be sent to the dimension- weight scanner for scaling weights and 3D sizes Consequently, due to their length, they are separated into two types: over 30 centimeters and under 30 centimeters.
During the sorting process, parcels are organized based on their geographical destinations Each belt is equipped with a barcode scanner that continuously updates the In-Out status of the parcels, ensuring efficient management and tracking throughout the sorting operation.
● OUTPUT SEGMENT: Finally, when it comes to the outbound sequence, the parcels’ information will be updated on the Lazada database for customers to keep track of their orders Later on, parcels whose length of one side is larger than 30 cm will be loaded into baskets or on pallets, while the under – 30 cm will be loaded into bags which are linked to sensors that work when the bags are full to notice the workers to load it on pallets and replace the new bag In the end, parcels are distributed to 4 Lazada warehouses around Ho Chi Minh City on telescopic conveyor belts leading to trucks, which enclose the sorting hub flowchart.
P HYSICAL M ODEL
In this section, as the data needed for this project belongs to the privacy and security of a company, we decided to collect data from mainstream newspapers and practical tours during March and April 2023 These are the following data:
- Data of dimensions of each of parcels: see more in Appendix.
- Time data of processes (parcels arriving, loading parcels into singulators, sorting in the cross-belt system, the manual procedure for unreadable barcodes, loading into trucks):
+ Flow: In one minute there will be 693 parcels arriving at the sortation center The staff will receive these parcels and load them onto telescopics with 60 parcels per minute Then, parcels will be loaded onto singulators; there are 12 singulators and there will be 83 parcels loaded onto each singulator in one minute There will be 10 DWS machines for examining the dimensions of parcels and no delay for this process During the sortation process, the number of parcels sorted (for both over and under 30 centimeters) is 200 to 400 parcels per minute For the scanning process, there are 50 parcels scanned in one minute Finally, it is expected to have 693 parcels per minute loaded onto the trucks Additionally, for unreadable barcodes which are approximated from 3 to 5 per 1000 parcels scanned successfully. lOMoARcPSD|39211872
During the data collection, due to the privacy and limitation of resources from websites, we are advised to assume our data In addition, as the license Arena that we use in this simulation project is Student license, we have to down-scale data to be suitable with the software so that the process can run To be more specific, the number of parcels at the input process in our project is 150 parcels per day.
Because of the fact that this simulation project can not cover all the flow of parcels, we only choose some important segments and their data in this process.
Table 2.1 Data of dimension of parcels
Table 2.2 Data of time of processes
Order Name of the process Value
1 Loading a parcel onto a conveyor belt
2 Flipping a parcel over and scanning it
Arena Simulation software, acquired by Rockwell Automation under the "FactoryTalk" brand, utilizes discrete event simulation modeling for effective scenario simulations in logistics, warehousing, and manufacturing By employing a proven five-step method, Arena enables 2D and 3D modeling, leveraging real-world data to ensure successful simulation projects.
There are 3 sequences below divided from the detailed flowchart of the full process The first yellow one is Inbound which also contains a green area for the manual procedure, the following blue one is Sortation, and the last purple one is Outbound:
Figure 2.7 Inbound segment and manual procedure
Input Parcels from all E-sellers or sales organizations around the country.
When trucks with parcels arrive, workers will unload parcels and put them on telescopic conveyor belts.
Parcels are separated, transferred into the hub, and arranged evenly
The singulator will separate and make the distance between parcels before transferring them into the further inbound sequence in order to help the DWS work properly.
Each conveyor belt has a barcode scanner to confirm that the parcels have arrived at the sorting center.
● Management area (reject): The area gathers all parcels that the barcode cannot be read and waits for workers to handle them.
● Recheck parcels’ information: The workers then find important information about the inferior parcel such as destination, phone number, receiver’s name, etc.
After verifying pertinent details, employees generate a new barcode for the package This initiates the inbound processing cycle anew as the package is routed back to its starting point.
Each belt has a DWS to weigh and measure the parcel’s 3D size. lOMoARcPSD|39211872
Barcode scanner for each belt)
Parcels’ barcodes are scanned one more time to confirm the destination that the parcel will come to.
Update information on the database
The previously scanned information is transferred to the company’s database for customers to keep track of their bought parcels.
After scanning, parcels are brought to the cross-belt sorting area to sort into particular geographical destinations.
Loads parcels into bags Parcels whose dimension sizes are smaller than 30 cm are loaded into bags.
Check the capacity of the bag by auto- outbound function
There is a sensor working for each bag If the bag is weighed more than 30 kg or the sensor is covered by a parcel, it will make a signal for workers to check its capacity. lOMoARcPSD|39211872
Load on next bag The sensor does not signal (red light) means that the bag is capable to stack more parcels.
With the sensor activated, one worker prepares and loads empty bags onto the conveyor belt, ensuring a continuous supply of containers for the production process Meanwhile, another worker monitors the completion of bags traveling along the belt and swiftly replaces full ones with empty ones At the end of the conveyor line, a dedicated worker efficiently loads the filled bags onto pallets, organizing them for further distribution or storage.
Load parcels into cages/pallets
Parcels whose dimension sizes are larger than 30 cm are pushed down the slides and loaded into cages (or pallets).
The cages (or pallets) are then loaded on trucks and delivered to 4 Lazada hubs located in Ho Chi Minh City.
Output 4 Lazada hubs located in Ho Chi Minh City.
Figure 2.10 Sortation Arena model – a lOMoARcPSD|39211872
● Build the model simulation by Arena software:
Our simulation will base on the detailed flowchart above Each logical model in the used flowchart will be converted into a logical model in Arena with the same function Because of some limitations, it is probably impossible to simulate the practical center precisely; therefore, we decided to establish the model that is most relevant to the one in the flowchart.
● The simplified layout of Lazada Logistics Park center:
Figure 2.12 The simplified layout inside Lazada Logistics Park
This layout is the outcome of collecting practical information from Lazada about how they arrange their center For more specific names, functions, and engineering data of each of the machines, we put it in Appendix.
There are 3 main areas in this layout: Inbound, Sortation (containing A, B, and C zones with the same functions), and Outbound However, due to the C zone maintained and the limitations of Arena software, we will not indicate this zone in the layout. lOMoARcPSD|39211872
● Model description (go from the left to the right):
Table 2.3 Table of the description of the models used in Arena
Parcel arrive Create Create the first entity
Assign dimensions Assign Assign three different attributes including weight, height, length for later sorting
Assign destination Decide Use to separate into 4 different outputs
Assign Assign different geographical destination attributes for 4 items output for later sorting
Load onto the conveyor Process Use to simulate the worker manually flipping the barcode to the correct rotation and load it onto the conveyor
Station a_1 Station Declare the position of the item within the system and access the conveyor A to begin the sorting process
Station 2 Station Grant access to the entity for the next module by conveyor
Sort by dimensions Decide Simulate the process of the o-belt system separate items with any side above 30cm into a different conveyor belt and ones lOMoARcPSD|39211872 below 30cm into another one
Exit 1, Exit 2 Exit Exit the current conveyor obelt to entire the cross- belt sorting
Station a_3, Station a_4 Station Declare item location within the system and grant access to the cross- belt sorter for separate large and small items.
Access large item conveyor, access small item conveyor
Station a_5, Station a_6 Station Grant access to the items for the next module
Sort by destination for large item, Sort by destination for small item
Decide Simulate the process of cross belt system sorting parcel by destination and moving it to the correct output position
Exit Leave the current conveyor belt through different gates lOMoARcPSD|39211872
Large item going to Station Use to direct items to the district 1, Large item correct location to send to going to district 2, Large their respective destination item going to district 3,
Large item going to district 4, Small item going to district 1, Small item going to district 2,
Small item going to district 3, Small item going to district 4
Going to district 3, Going to district 2, Going to district 3, Going to district 4
Station Act as a destination for the previous route module
Create 2 Create Simulate a clockwork truck schedule to take items to their respect area
Hold Wait for the previous signal module to go off to simulate loading item on truck when trucks arrive lOMoARcPSD|39211872
Going to district 1, Going to district 2, Going to district 3, Going to district 4
Dispose Act as endpoint, destination for the simulation
O PERATION DESCRIPTION
By simulating the model on Arena we can see that the time utilization of the loading worker is the bottleneck of this system The average time to load a parcel takes roughly 3 to 6 seconds depending on the volume and weight of the parcel.With the large stream of continuous parcels going in at the average pace of 1 parcel every
0.5 seconds This causes the worker to be overloaded and couldn’t keep up with the flow of parcels hence becoming a bottleneck This causes the system 9.67minutes just to deal with 149 parcels To solve this problem I suggest adding 3 to 4 more workers at the loading process to keep up with the flow of incoming parcels.
A RENA ANIMATION
In Figure 2.13, the red line represents the path that the parcel takes Due to the limitation of the education version, only one input belt is used for demonstration. The parcels will take one of the two orange belts based on their size After they arrive at the crossbelt sorter, they will be manually transferred to the destination scanner lOMoARcPSD|39211872 and then fed to the crossbelt sorter The parcel will run along the perimeter of the yellow pill-shaped graphic which represents a crossbelt sorter The parcel will arrive either in the green chute or the exit slide which is marked by the green outline.
SOLUTION DEVELOPMENT
C ASES
3.1.1 Case 1: Before the Covid-19 pandemic
Figure 3.1 The average amount of time that Vietnamese consumers stayed when accessing mobile–based e-commerce websites or sales applications from 2016 to 2017 [1]
During this digital age with information technology in general and e- commerce in particular before suffering from COVID-19, consumers tended to change their traditional ways of searching and shopping into new and more convenient experiences However, the average amount of time that Vietnamese consumers spent when accessing mobile-based e-commerce websites or sales applications from 2016 to 2018 was not significant It is logical to infer that mobile- based versions are not able to draw the attention of Vietnamese
[1] Vietnam Business Index Report (2019) lOMoARcPSD|39211872 consumers during these periods The graph above reflects the report from the enterprises that only 18% of their customers spend more than 20 minutes accessing mobile-based shops and most of them (39% in the same year 2018) access from 5 to 10 minutes.
The limited availability of mobile platforms for small and medium-sized enterprises (SMEs) hindered the adoption of online shopping for many consumers This lack of diversity in product offerings led to a preference for brick-and-mortar stores despite some changes in shopping behavior.
Figure 3.2 Vietnamese e-commerce marketplace’s revenue from 2015 to 2019 (Billion USD) [1] [1] Global, B (2020, November 30) 5 critical things to look for in the Vietnam E-commerce Report
2020.Boxme Global https://blog.boxme.asia/5-things-look-for-in-vietnam-ecommerce-report-2020/
From Figure 3.2 and combined with the information before and after the pandemic, 2020 is witnessed as a milestone when Covid pandemic starts spreading and economic slowdown; however, this year is also a preliminary step for the entire e-commerce industry in Vietnam when this industry develops in many aspects This year, several companies decided to change their shop status: from offline to online Many e-commerce platforms were born and became more familiar with Vietnamese consumers such as Tiki, Sendo, Lazada, Shopee …etc. The online shoppers (in million) during this time are estimated at 44.8 million people (equal to 46.77% of the Vietnamese population this time) This was an important insight for e-commerce enterprises to expect for the further development of this industry.
3.1.2.1 The change in shopping online behavior of customers after COVID–19 lOMoARcPSD|39211872
Figure 3.3 Vietnamese e-commerce marketplace’s revenue from 2017 to 2022 (Billion USD) [1]
Notwithstanding the influence of Covid – 19 pandemic, 2021 was witnessed as a successful year for e-commerce across Southeast Asia According to Statista, Vietnam’s retail e-commerce market is predicted to increase by 300%, from 13,7 billion USD in 2021 to 39 billion USD in 2025 This growth of the digital economy can be explained by the trend of grocery shopping on e-commerce platforms, the increase of e-sellers, and Shoppertainment (shopping combined with entertainment) Vietnamese consumers spend more time on these platforms and are willing to place orders of greater quantity and value They are also willing to spend more online, which can be seen from the data above when
In 2021, Vietnam's eCommerce market witnessed a surge in online purchases, with consumers spending an average of 251 USD, a notable increase of 26 USD compared to 2019 This steady growth highlights the increasing popularity and convenience of online shopping among Vietnamese consumers.
The report of VECOM also stated that during the peak quarantine period from February to April 2020, the e-commerce platform was the only channel approaching some products and services, which affected significantly e-commerce enterprises, especially deliveries – logistics enterprises The business situations of deliveries – logistics enterprises were witnessed more positively than others simultaneously The number of orders from e-commerce platforms increased remarkably as a result of a change in the selling activities of merchants when they tended to sell on e-commerce platforms Hence, by the influence of the pandemic, e-buyings increase and generate opportunities for delivery services to develop rapidly.
In conclusion, after Covid – 19 pandemic, Vietnamese consumers have significant changes in shopping behaviors when they tend to do more online shopping The number of people shopping online in 2022 is estimated between 57 to 60 million people (equal to 63% of the Vietnamese population approximately). Vietnamese citizens decrease their time visiting brick-and-mortar stores And following the report of Vietnam Logistics 2022 of the Ministry of Industry and Trade, time is the first and foremost factor, which forces Logistics and Supply Chain management enterprises’ hands to establish an effective and modern supply chain. lOMoARcPSD|39211872
3.1.2.2 The distribution of types of products
Figure 3.4 The distributions of types of products bought online [1]
From Figure 3.4, we can realize that the main types of products bought by Vietnamese online shoppers are FMCG The percentage of groups of clothes and cosmetics is 69%, which is followed by that of household goods (64%) and electronics devices (51%).
Besides the remarkable achievements of e-commerce in Vietnam, some obstacles relating to e-logistics services are also pointed out for a breakthrough in the coming period:
● The logistics service – last mile delivery – order fulfillment has many limitations: orders are placed across the region and it usually takes around
[1] Bộ Công Thương: Sách trắng Thương mại điện tử Việt Nam (2022)
3 – 7 days for customers to receive However, the demand of Vietnam consumers are increasing, especially the time issues which should be solved as fast as possible;
● The products are affected by the manners, and hobbies of consumers who demand convenience;
● The retailers and distributors have to deal with the products owning shorter life cycles, small orders, handling large numbers of orders of many types, requiring fast delivery schedules and high precision.
Some enterprises may find it difficult to solve these problems as it requires a generally effective strategy, especially the requirement of a supply chain designed to work with products distributed in the short term.
S OLUTION
As regards the rapid development of E-commerce in Vietnam with shrinking parcel size and consumer experiences prioritized, most Logistics enterprises tend to transform from traditional logistics to e-logistics One of the standouts that can be mentioned is a sorting center applied with technologies E-logistics is more suitable for large-scale and foreign companies In the field of e-logistics, technology plays an integral part To fully participate in the e-logistics supply chain, companies should invest millions of dollars in goods sorting lines In addition to investing in an automatic classification system, companies operating in e-logistics must also be equipped with management software to connect information ỉnfrastructures.
SWOT
The Sortation center is attached fully to modern technologies such as artificial intelligence (AI), machine learning, and Dimension-weight scanner …, which leads to the fact that it can reduce labor costs and mistakes during the process Companies only have to hire a small number of labor employees to solve some manual problems (renew and reprint the barcodes of parcels) In addition, almost all parcels are sorted by machine; hence, there will be fewer accidents and fewer broken or damaged products.
Sortation can also provide companies or enterprises with fast order and delivery processing As a result of that, the waiting time of customers is able to be alleviated.
Cost poses a significant challenge, with cross-belt conveyor systems demanding the highest expenses The high cost of e-logistics has hindered traditional logistics companies from entering the market Additionally, Vietnam's GDP growth of over 20% in logistics is largely attributed to infrastructural limitations.
Due to the surge in demand for warehouses and branches in Vietnam, the need for skilled workers with knowledge in e-logistics is increasing This demand is posing challenges, particularly for small and medium-sized logistics companies, who may lack the resources to access and train workers with the necessary technological expertise to navigate the e-logistics landscape effectively.
Following Vu Duc Thinh – CLO of Lazada Logistics, even though the percentage of accuracy while the automated sortation process occurring made up to99.95%, there are still 0.05% of mistakes, which is equivalent to that some parcels barcodes (ranging from 3 to 4 parcels per 100 000 parcels arriving at the sortation center per a day) This may put a negative effect on operational efficiency.
E-logistics in Vietnam is very potential not only it is still a new segment, but also Vietnam consumers are tending to do more online shopping and it is expected to bring a lot of profits for investments With the booming e-commerce industry, it is forecasted that Vietnam’s e-logistics segment will develop significantly more than ever And in this competition, only an enterprise that knows how to apply technologies, and respond to the demand of consumers as fast as possible by generating effective classification systems can be successful.
Even though the sortation tried to speed up their sorting processes, there are still some unpredictable factors influencing the transportation of parcels to customers (transport infrastructure underdeveloped for instance), which is the result of bad experiences of customers.
By the survey by the Ho Chi Minh City Institute For Development Studies about the source of the logistics workforce, the percentage of businesses lacking staff who have abilities and knowledge about logistics is 53.3%; moreover, there are 30% of businesses have to retrain their work-labor and 6.7% who satisfy with their major level of staffs This means that the human resources of E - logistics in Vietnam are both deficient and weak in major Hence, we may not ensure that the sortation center can still work swimmingly if there are any technical problems suddenly happening and we also question the development of the center in the future. lOMoARcPSD|39211872
There are more sortations centers simultaneously so there may be some intense competition relating to customer experiences, new entrants, competition of technology, and also the problem of collaborations.
CONCLUSION
A DVANTAGES
Thanks to modern and automatic technologies, the Lazada Logistics Park can help improve operational efficiency and reduce labor costs With an up to 99 percent automated sorting system, parcels can be quickly and accurately handled and selected, thereby shortening order processing time as well as cutting down delivery time, which provides customers with the optimal solutions for shopping online This is witnessed as a milestone in E-logistics in Viet Nam.
Figure 4.1 The rank of E-commerce companies in June 2023 [1]
D ISADVANTAGES
As the main type of conveyor used by Lazada Logistics Park is a cross-belt conveyor, the biggest drawback here is the cost when it has the most expensive cost In addition, Lazada also admits that the percentage of accuracy in the sorting process is 99.95%, which means that there is still a 0.05 percentage of failure in sorting parcels and they have to deal with these manually And for little shops and organizations, this sorting hub seems to be not approached as the problems in the costs policy of Lazada.
A PPLICATIONS
Our simulation so far can approach the application of simulation From the data and information collected, we can simulate Lazada Logistics Park and its sorting function inside This brings us to gain more knowledge and observations about the relationship between e-sellers, logistics enterprises, and e-buyers in this digital age when e-commerce develops rapidly and buyers require more advantages from the logistics industry.
Moreover, as a result of building a model of a sortation center, we are able to explore more things about a realistic sortation center, especially the most modern, and adapt to the development of e-commerce like Lazada’s one By observation throughout this simulating model, we can understand the system performance such as the function of the cross-belt/ o-belt conveyor, how the system can update the information of parcels of each custom detailedly on the general system …etc.
Thanks to Arena simulation software, we know how to create animations from a real system At the end of this project, we know what a sortation center is and examine whether our inductive logic has been suitable to reality yet.
R ECOMMENDATION
This simulation project of the Lazada sortation center presents difficulties and data limitations, preventing the simulation from accurately depicting the actual sorting process Consequently, further research is recommended to enhance the potential of this sortation center in the future.
Simulation-optimization approaches offer effective solutions for complex layout design problems In a case study, Chen (2021) successfully applied such an approach to optimize the layout of a sortation conveyor system, resulting in improved operational efficiency.
[2] Romaine, E (2021, February 1) Technologies Đã truy lục June 2023, từ CONVEYCO: https://shorturl.at/fKSX3
[3] Group, I (2018) Horizontal Crosbelt (IT-SS-CB) sortation systems Đã truy lục June 2023, từ IntechGroup: https://shorturl.at/hitB5
[4] Lazada Logistics Park opens, sorting 1 million parcels per day (2023,
March 24) Đã truy lục June 2023, từ Việt Nam News: https://shorturl.at/cjkO7
[5] Dương, Á (2023, March 03) Trung tâm phân loại 20.000m2 của Lazada ở
Bình Dương: Công suất 1 triệu đơn/ngày, phân loại cả gói hàng chỉ 100cm Đã truy lục May 2023, từ CAFEbiz: https://shorturl.at/gDGKQ
[6] Như, Q (2023, March 24) "Mạnh vì gạo, bạo vì tiền", Lazada Logistics ra mắt trung tâm chia chọn thứ 3 tại Việt Nam: Rộng 20.000m2, camera 6 chiều cân đo kiện hàng 3D tự động Đã truy lục May 2023, từ CAFEbiz: https://shorturl.at/lJMNR
[7] Dương, Á (2023, April 02) Lazada Logistics phát triển, khẳng định vị thế trên thị trường giao vận Đã truy lục May 2023, từ CAFEbiz: https://shorturl.at/douBM
[8] CLO Vũ Đức Thịnh: Cần cơ chế ưu tiên doanh nghiệp phát triển e-logistics.
(2023, May 30) (Lazada) Đã truy lục June 2023, từ Bán Hàng Lazada: https://shorturl.at/fgvL4
[9] Lazada Logistics khánh thành Trung tâm phân loại hàng hóa tự động rộng 20.000m2 (2023) (Lazada) Đã truy lục June 2023, từ Lazada Logistics: https://shorturl.at/kwzHR
[10] Lazada khánh thành Trung tâm phân loại mới xử lý 1 triệu đơn mỗi ngày
(2023, March 24) (Lazada) Đã truy lục June 2023, từ Trí Thức Trẻ: https://shorturl.at/kEY14
[11] Anh, M (2022, December 01) Giám đốc Lazada Logistics: Nếu đặt trung tâm chia chọn xa nội đô thêm 5 km, mỗi ngày mất thêm quãng đường tương đương hai chiều từ Nam ra Bắc (Lazada) Đã truy lục May 2023, từ CAFEbiz: https://shorturl.at/cepvG
[12] Reputa (2022, March 04) Báo cáo toàn cảnh thị trường Thương mại Điện tử Việt Nam trên Social Media năm 2021 Đã truy lục May 2023, từ Reputa: https://shorturl.at/dlpAD
[13] VietnamCredit (2022, March 03) Major trends in Vietnam’s e-commerce market in 2022 Đã truy lục July 2023, từ febis: https://shorturl.at/atN25
[14] Nguyen, M.-N (2021, October 19) Change in online purchase behavior during coronavirus (COVID-19) among respondents in Vietnam in 2020 Đã truy lục April 2023, từ statista: https://shorturl.at/nuNU2 lOMoARcPSD|39211872
[15] Le, Q V., & Nguyen, J Q (2021, February 23) How COVID-19 is speeding up Vietnam’s digital transformation Đã truy lục Ju;y 2023, từ
EASTASIAFORUM: https://shorturl.at/aovR5
[16] Minh, N (2020, November 05) Vietnamese shoppers increase online purchase frequency in 2020: Survey Đã truy lục June 2023, từ HANOITIMES: https://shorturl.at/ajlN1
[17] BOXME (2020, November 27) 5 Critical Things To Look For In The
Vietnam Ecommerce Report 2020 Đã truy lục April 2023, từ BOXME: https://shorturl.at/ghOQY
[18] Nguyen, J (2021, July 09) How COVID-19 Has Changed E-Commerce In
Vietnam Đã truy lục May 2023, từ Vietcetera.: https://shorturl.at/itzTV
[19] The State of E-Commerce In Vietnam (2020, June 17) Đã truy lục April
2023, từ parcelmonitor: https://shorturl.at/fDJ27
[20] VNN (2022, August 29) E-commerce boom: key for logistics development Đã truy lục July 2023, từ Ministry of Information and Communications of the Socialist Republic of Vietnam: https://shorturl.at/gkvX0
[21] Munoz, E (2022, December 6) The Ecommerce Situation in Vietnam Đã truy lục April 2023, từ AMZ Advisers: https://shorturl.at/fjmtM
Improving automotive service through e-logistics: a case of Moenco Hawassa, Ethiopia International Journal of Economics and Management Systems, 5(2367
[23] Erceg, A., & Sekuloska, J D (2019, January 15) E-LOGISTICS AND E-
SCM: HOW TO INCREASE COMPETITI- VENESS Scientific Journal of
[24] Trade, M o (2022) BÁO CÁO LOGISTICS VIÊT NAM 2022: LOGISTICS
XANH Hà Nội: Publishing House for Industry and Trade.
[25] Jarrah, A I., Qi, X., & Bard, J F (2014, May 21) The Destination-Loader-
Door Assignment Problem for Automated Package Sorting Centers Articlé in
[26] Nguyen, M H., Armoogum, J., & Thi, B n (2021, August 17) Factors
Affecting the Growth of E-Shopping over the COVID-19 Era in Hanoi,
Vietnam The Evolution of Consumer Behavior in the Sustainable Business:
[27] Minh, N T., Ha, N T., & Duong, N D (2022) Factors Affecting E-
Logistics Services: A Case Of Vietnam’s Northern Key Economic Region
Journal of Positive School Psychology, 6(7), 4008 - 4017.
[28] (VECOM), V E.-c (2020) Việt Nam: Thương mại điện tử tăng tốc sau
Covid - 19 Ho Chi Minh: NAVEE.
[29] VietnamCredit (2021, November 02) CHANCES AND CHALLENGES OF
E-LOGISTICS IN VIETNAM (VietnamCredit, Nhà sản xuất) Đã truy lục May
2023, từ VietnamCredit: https://shorturl.at/mwKLV lOMoARcPSD|39211872
1 Result of Arena simulation lOMoARcPSD|39211872
2 Data of dimensions of each parcel:
Item Width (cm) Length (cm) Height (cm)
1 Dimension Barcode and Weight Scanner:
Source: https:// www.falconautotech.com/ibx-jumbo-automatic/
2 O-belt Module Sorter (Swivel Wheel Sorter):
Source: https:// www.trapo.de/en/products/sorting-and-distribution- technology/trapo-omni-sorter/#1612261918732-050320a3-2d2e
Source: https://cafebiz.vn/manh-vi-gao-bao-vi-tien-lazada-logistics-ra-mat- trung-tam-chia-chon-thu-3-tai-viet-nam-rong-20000m2-camera-6-chieu-can- do-kien-hang-3d-tu-dong-176230324163054272.chn lOMoARcPSD|39211872
Source: https://cafebiz.vn/lazada-logistics-phat-trien-khang-dinh-vi-the-tren- thi-truong-giao-van-176230402130154293.chn
Capacity: 30kg or the sensor is covered
Source: https://logistics.lazada.vn/blog/lazada-logistics-khanh-thanh-trung- tam-phan-loai-hang-hoa-tu-ong-rong-20-000m2
6 Chute Exit Conveyor (lower conveyor):
Source: https://logistics.lazada.vn/blog/lazada-logistics-khanh-thanh-trung- tam-phan-loai-hang-hoa-tu-ong-rong-20-000m2
7 Exit Slide for Large Parcels:
Source: https://logistics.lazada.vn/blog/lazada-logistics-khanh-thanh-trung- tam-phan-loai-hang-hoa-tu-ong-rong-20-000m2 lOMoARcPSD|39211872
8 2-stories Cross-Belt Sorter (upper conveyors):
Source: https://intech-group.vn/day-chuyen-phan-loai-buu-kien-tu-dong- cong-nghe-crossbelt-bv205.htm