Ayala ventures into logistics

MANILA, Philippines — Ayala Corp. is making its foray into the technology-driven logistics business with the launch of a new company, Entrego Fulfillment Solutions Inc., which commits to offer an integrated suite of services including parceling, document and deliveries.

Entrego is a joint venture with the Global Fashion Group (GFG), founder of online fashion store Zalora. Ayala’s AC Infrastructure Holdings Corp. (AC Infra) owns 60 percent of the joint venture, while GFG subsidiary Brillant accounts for the remaining 40 percent.

After the successful launch of Entrego, AC Infra is partnering with a Nasdaq-listed company for another soft infrastructure joint venture possibly before the end of the year, AC Infra CEO and Entrego chairman Rene Almendras told reporters yesterday.

All these investments in soft infrastructure — platforms that can help move people, goods and services faster – are part of the Ayala Group’s efforts to meet the changing and growing needs of the marketplace.

“We are applying technology to transform the logistics ecosystem. Our intent is to innovate and organise services to achieve better operating and cost efficiencies for the various customers we have, whether they are, medium or small scale,” Almendras said.

For Entrego, AC Infra is committing to pour in P1 billion to grow Entrego into a major technology driven logistics provider in the country including the construction of  state-of-the-art e-commerce center to support back office operations. The facility can support more than 100,000 orders daily when fully operational by the second half of 2019.

The new company will draw from its strong competence and track record in e-commerce fulfillment solutions, having started in 2013 as Zalora Philippines’ logistics division.

Ayala Corp. chairman and CEO Jaime Augusto Zobel de Ayala sees the benefits for the Ayala Group with Entrego.

“Our business units overlap on several fronts and managing their supply chain and their fulfillment services needs to its customers is one such front where we see Entrego adding value,” Zobel said.

Furthermore, he said Ayala’s entry into the fulfillment space “unlocks opportunities for its real estate, banking, telecom, health, automotive and industrial manufacturing businesses.”

It also paves the way for new business models.

Entrego has 45 hubs at present and is handling 37,000 orders a day in its sortation centers. The company is targeting to grow this to 60 distribution hubs by 2019 and to grow its capacity to more than 100,000 a day with the new facility. 

Entrego president Constantin Robertz said with the company’s technology-driven fulfillment solutions, the company hopes to enable businesses to grow and allow them focus on their core competencies by taking care of their logistics needs.