MSMEs FACE INCREASING CHALLENGES DUE TO RISING LOGISTICS COSTS -- SAMENTA

KUALA LUMPUR, Dec 9 (Bernama) -- The micro, small and medium enterprises (MSMEs), accounting for nearly 97 per cent of all business establishments, are facing increasing challenges due to rising logistics costs, said the Small and Medium Enterprises Association (Samenta) Malaysia.

It said while delivery charges have steadily climbed in response to the Red Sea disruptions and an unexpected spike in demand, such measures are unsustainable in the long term.

Adding to this strain, the Malaysian Communications and Multimedia Commission (MCMC) has proposed regulating courier base prices to sustain the industry, a move that has sparked concerns about its potential impact on cost-sensitive businesses, a topic widely discussed among industry players such as Pos Malaysia Bhd.

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These changes include pushing for the implementation of a floor price for parcels, which they argue would help create a more level playing field within the courier sector.

Malaysia’s courier and parcel market is expected to grow significantly, reaching an estimated US$1.58 billion (US$1=RM4.41) by 2025, driven by the e-commerce boom. However, this promising growth could be hindered by inefficiencies and rising costs that disproportionately impact SMEs and consumers.

Affordable logistics services remain a critical factor in ensuring equitable access to the benefits of this market expansion, said the association.

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“For small and medium enterprises (SMEs), the logistics costs can significantly influence their competitiveness. Many are now faced with a difficult trade-off, whether to absorb rising delivery expenses and shrink already slim margins, or pass these costs on to customers, risking reduced sales.

“Both options create financial strain, particularly as businesses navigate economic recovery and increasing market competition,” it said in a statement.

To ensure Malaysia’s logistics sector continues to support SMEs and the broader economy, innovation and digital transformation must take centre stage, said Samenta.

“Advances in automation and artificial intelligence (AI) offer opportunities to improve operational efficiency and service reliability, where automated warehousing systems can streamline inventory management, while AI-powered route planning can minimise delivery delays and optimise fuel consumption.

“Tools such as real-time shipment tracking and predictive analytics allow SMEs to anticipate and mitigate potential disruptions while optimising their operations.” 

Meanwhile, Samenta national president Datuk William Ng said SMEs continue to grapple with rising costs and the pressure to increase selling prices.

“With additional compliance requirements such as the e-invoicing mandate and adherence to environmental, social, and governance (ESG) standards, businesses are under significant strain.

“To ease this burden, we urged policymakers, regulators, and logistics players to focus on delivering solutions that prioritise efficiency, affordability, and innovation to support the resilience and growth of SMEs,” he said.

The association said relying solely on cost increases to address logistical challenges is no longer viable.

The future of Malaysia’s logistics industry lies in collaboration among industry players, policymakers, and SMEs to foster a logistics ecosystem that promotes innovation and rewards efficiency.

It stressed that by embracing these changes, the logistics sector can support SMEs while ensuring that Malaysia’s economy remains resilient and competitive.

-- BERNAMA