The 21st-century consumer has long been focused on the when and where of consumption, but the intricacies of how goods are created and transported have remained largely mysterious. While often overlooked, supply chains are fundamental to our daily lives and global operations. Their significance becomes apparent only when disruptions occur, affecting the availability and timing of goods and resulting in major losses, with 60% of small and medium businesses reporting that they have lost up to 15% in revenue due to supply chain delays.[1]

Customer expectations have transformed significantly, with over 90% of customers expecting 2-3 day delivery times. Emerging customer needs include improved last-mile delivery reliability, 24/7 customer support, instant quoting, reverse logistics, advanced data analytics, and e-commerce channel management. To remain competitive, logistics players are expanding their service portfolios through vertical integration, offering end-to-end solutions, or horizontal integration, consolidating offerings within the same domain to enhance cost efficiency and buying power.

Unpacking Supply Chains

The supply chain sector has traditionally been resistant to digitization. This resistance stems from the sector's business-to-business nature, where value is primarily determined by cost-effectiveness for business customers. Unlike other sectors driven by changing consumer expectations, supply chain customers have limited options and are primarily focused on low costs and operational efficiency.

In emerging markets, particularly in the Middle East and Africa (MEA), supply chain infrastructure is at various stages of development, ranging from basic to more advanced systems. MEA is emerging as global leader in digital adoption, driven by a tech-savvy population where Millennials and Gen Z account for nearly half of MENA's demographic. This digital transformation is reflected in the region's e-commerce growth, with 67% of millennials preferring online shopping for convenience and over 27% planning to increase their digital spending.[2] The rise of fintech solutions such as e-wallets, Buy Now Pay Later services, and enhanced internet access has catalyzed e-commerce expansion. Since 2020, MENA's e-commerce sales have surged by 80%, growing at an annual rate of 14%, and are projected to reach $57 billion by 2026, significantly outpacing the global e-commerce CAGR of 11%.[3]

Despite this growth, challenges remain. Logistics bottlenecks, fragmented supply chains, and high shipping costs hinder optimal growth. Southeast Asia's similar geographic and logistical challenges offer lessons in overcoming these barriers, underscoring the importance of streamlined infrastructure to fully capitalize on MEA's digital potential.

Asset-Light vs. Asset-Heavy Models

The lack of innovation among established logistics firms and their reliance on on fragmented third-party systems have opened opportunities for startups to address long-standing challenges and evolving market demands. By leveraging technology, these startups enhance supply chain efficiency through improved data visibility, digital interoperability, and risk mitigation.

Locad is a Fourth-Party Logistics (4PL) solution for e-commerce brands, ensuring systematic storage, packing, shipping, and order tracking throughout the Asia-Pacific region. Powered by its end-to-end tech platform, Locad synchronizes inventory across various online channels and orchestrates order fulfillment.

4PL is an operational model in which a business outsources its entire supply chain management and logistics to one external service provider. Unlike a third-party (3PL) provider, which oversees part of supply chain operations for a business, a 4PL provider is usually the single point of contact for supply chain management. This provider has a broader scope of responsibilities, including managing resources, technology, and infrastructure and providing strategic insights and management.

These models transform e-commerce by enabling businesses to reduce fixed costs and labor dependencies through outsourcing to trusted partners. This approach lowers operational overhead and facilitates the adoption of cost-saving technologies like automation, AI-driven analytics, and robotics without requiring significant infrastructure upgrades. By leveraging these technologies, asset-light models create an agile and connected omnichannel commerce infrastructure.

Locad’s light infrastructure addresses critical challenges in the e-commerce ecosystem, such as channel fragmentation, geographic dispersion, data complexity, inventory silos, slow delivery, and high shipping costs. By streamlining operations and enhancing flexibility, its asset-light model enables businesses to adapt quickly to changing market demands while delivering efficient and scalable solutions for omnichannel commerce.

The Singapore-based startup expanding into the GCC was founded by a team with deep expertise in e-commerce, technology, and logistics and has quickly scaled to support over 250 brands across six countries. The journey began with co-founders Constantin, Jannis, and Shrey, seasoned entrepreneurs with a history of building high-growth digital companies in Southeast Asia and Europe. Drawing on their operational experience at Rocket Internet companies, they recognized the core challenges faced by e-commerce brands and came together to create solutions tailored to address local market needs and complexities.

Leveraging this expertise, Locad has set ambitious expansion plans targeting new markets, focusing on the Middle East. This strategic move aims to position the company as a pivotal player in democratizing backend infrastructure for modern commerce, bringing learnings from the East into the MEA region.

Looking Ahead

Companies like Locad that develop solutions to address the challenges of modern e-commerce logistics hold significant potential to transform the creation and transportation of goods while driving the digitalization of the supply chain industry.

As e-commerce grows and consumer expectations evolve, innovative solutions like cloud-based logistics platforms and asset-light models are reshaping the sector’s digital transformation.

At Global Ventures, we believe a supply chain revolution is on the horizon. We are deeply committed to empowering entrepreneurs in emerging markets who create groundbreaking innovations to serve the next 1.5 billion consumers.

This article was co-authored alongside Rayan Tabbara and with support from Lana Azhari .

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