BANGKOK, Oct 26 – Thailand’s Industry Ministry is moving forward with reducing logistics costs of the industrial sector by 15 percent as targeted by the government.
Primary Industries and Mines Department’s Logistics Bureau director Anong Paijitprapapon said the move came after an approval from a committee meeting on development and management of the country’s logistics system and services chaired by Deputy Prime Minister/Finance Minister Kittirat Na Ranong.
The 15 percent cost reduction was set from the current logistics costs of the country’s industrial sector at more than Bt500 billion.
The cost reduction will apply to expenditures originating from inventory burden, which currently counts for 55 percent of overall logistics costs.
These costs are targeted to be lowered by 40 percent through a pilot project of clustered logistics entrepreneurs applying the same efficient software system to eliminate empty trucks and have them loaded with goods for all journeys, starting in Thailand’s North and Northeast this year.
A similar project will start in other parts of the country next year. The entire plan to be applied for the whole country will be completed by 2016.
Ms Anong said Thailand’s overall logistics costs is as high as Bt1.6 trillion for the industrial sector, trade & services and agricultural sectors, each having similar costs at over Bt500 billion. Out of all sectors, the industrial one has the highest amount of inventory stocks.