How bottom-up digitalisation is greening FMCG logistics in Southeast Asia

One of the most overlooked sources of inefficiency lies at the very start of the process: the sorting centre.This is where every parcel is scanned, grouped, and dispatched for delivery. It may not feature prominently in most sustainability conversations, but how parcels are sorted directly affects fuel use and emissions. When sorting is inefficient, parcels are grouped poorly, leading to longer routes, lower delivery density, and half-empty vans covering more ground. At scale, this results in a significant carbon cost.Digitalisation at the sorting centre level can address this. Automated systems that use real-time parcel data can group deliveries by location, timing, and density, enabling vehicles to leave with fuller loads and more efficient routes. Some studies estimate that these improvements can reduce last-mile delivery distances by up to 20%. At J&T Express, we utilise AI-powered sorting systems and automated conveyor networks in major hubs across all our operations to drive faster, smarter parcel processing. This is particularly key for our customers in the FMCG sector, where parcels often have shorter shelf life. The compact parcels pass through automated scanners that capture weight, dimensions, and its delivery address in one step, ensuring precise sorting while reducing energy consumption per parcel.Businesses should also understand that not all automation require a significant overhaul of operations to deliver gains. Even small changes, such as adjusting sorting logic, digitising bin allocation, or better aligning sorting with peak delivery patterns, can reduce handling errors, optimise vehicle loading, and improve route efficiency. For example, a parcel sorting facility in Thailand increased output by more than 3,800 parcels a day by streamlining manual sorting steps and reconfiguring its floor layout. Queue times dropped by nearly half, and sorting congestion eased-all without major capital investment. Over time, these incremental changes can have a meaningful impact on emissions across the entire logistics network.can reduce handling errors, optimise vehicle loading, and improve route efficiency. For example, a parcel sorting facility in Thailand increased output by more than 3,800 parcels a day by streamlining manual sorting steps and reconfiguring its floor layout. Queue times dropped by nearly half, and sorting congestion eased all without major capital investment. Over time, these incremental changes can have a meaningful impact on emissions across the entire logistics network.

Just as smarter sorting shapes what goes into each delivery run, route planning determines how efficiently those deliveries are executed. In dense urban areas, one inefficient route or mismatched delivery zone can result in hours of wasted driving each day. In fact, according to the World Economic Forum, optimising delivery routes can reduce urban logistics emissions by up to 25%.On the surface, route planning appears simple: the shorter the distance, the lower the emissions. Unfortunately, in many markets across Southeast Asia, static route planning or rigid delivery zones are still the default . The fact is that traffic jams, weather changes, and shifting delivery volumes make static routes very quickly outdated. Dynamic route planning that considers live traffic conditions, accurate parcel forecasting, network load and local conditions, will be critical to truly optimise operations on the road. Advanced technologies like artificial intelligence (AI) are becoming a gamechanger in providing such predictive and real-time capabilities. Governments in the region are already starting to take heed of AI’s impact on the sector. In Vietnam, for instance, the logistics industry is embracing AI-based planning tools to better match routes to demand patterns on the ground, with over half of enterprises already deploying Big Data and AI solutions for this purpose. The onus is now on logistics providers across the region to experiment, learn and adopt these technologies, especially as delivery networks only get more complex amid rising demand.

Packaging is another area where operational inefficiencies quietly add up.In Southeast Asia’s rapidly growing e-commerce sector, speed and convenience are of the essence. Space efficiency of packaging often takes a back seat as a result, but its impact on the environment can be substantial. Oversized packaging wastes vehicle space reduces parcel capacity per trip, and lead to more delivery trips than necessary. In fact, in Singapore, the Ministry of Sustainability and the Environment has flagged this as a key challenge for the sector, and have introduced new guidelines aimed at cutting packaging waste in e-commerce and delivery services. With growth in Southeast Asia’s FMCG sector outpacing the wider Asia region in the first quarter of the year, it is critical that logistics players take this seriously – and quickly. At J&T Express, for instance, we use automated dimensioning tools to right-size packages. For the FMCG sector, where orders are often small and time-sensitive, this can make a difference in enabling fuller loads, fewer trips, and overall lower carbon per parcel. Across our operations in the region, we pair this with practical measures such as reusing packaging materials like bubble wrap and carton boxes, leveraging reusable transit bags, 45mm degradable tape, and one-sheet e-waybills. This is a clear example of how digitalising even the smallest of steps in the end-to-end delivery process can lead to outsized impact.

Finally, failed deliveries are amongst the most wasteful parts of the supply chain. When a driver is unable to complete a drop-off, the parcel must be returned, reprocessed, and redelivered, which adds extra distance, time, and emissions. A second attempt can increase the carbon footprint of a single parcel by as much as 75%. For non-durable items with short shelf-life, such as fresh produce or groceries, failed deliveries cost more than just carbon – they may very well end up spoilt.This is why we prioritise first-attempt success through proactive delivery notifications, where we have found that achieving a successful first delivery can reduce energy consumption per parcel by up to 33%. The push to reduce failed deliveries is also reflected in how Pickup and Dropoff (PUDO) networks are steadily gaining traction in cities across the region. Enabled by a layer of digital infrastructure such as real-time tracking, automated customer notifications, and integrated delivery schedules, parcels can be consolidated at shared locations, reducing the need for repeat delivery attempts.In Singapore, the government-backed Pick Network has shown promising early results, though adoption has been slow. Companies report productivity improvements of up to 19 times, and the system is projected to reduce carbon dioxide emissions by 600 tonnes annually. As urban density increases, shared digital infrastructure like PUDO will become essential to sustainable growth of the region’s logistics industry.

The logistics sector in Southeast Asia is evolving rapidly, driven by rising demand in sectors like FMCG and digital innovation. But growth, if unmanaged, can come at a cost. The challenge now is not just to scale, but to scale sustainably.Sustainability cannot be an afterthought. It needs to be embedded in how systems are designed, the technologies adopted, and how teams are upskilled to make the best use of technology. Governments might be leading the way, but without the buy-in of logistics players and providers, progress will be slow. This is where bottom-up digitalisation has the most to offer. For our own digital initiatives, we have seen measurable sustainability gains, operational efficiencies, and cost savings, often within just three months of adoption depending on scale. These results demonstrate that the road to sustainability is made not only through bold pledges or big capital investments, but data-driven improvements to the core processes – no matter how small – that move parcels every day.