Digital logistics company Yojee (ASX: YOJ) continuing to march onwards and upwards in its bid to streamline operational logistics for businesses.
After a string of deals announced over the past 6 months, Yojee signed a 2-year agreement with Riverwood, a Singaporean logistics company, to provide its logistics software which Riverwood anticipates will precipitate greater efficiencies, as well as simplifying and improving the user experience across Riverwood’s operations.
According to Yojee, the software will be used “off the shelf” by Riverwood, with a partnership program already in place to further optimise and innovate between the two parties.
Riverwood is rapidly growing its Singaporean presence having begun operations in 2012. The logistics company has established several high-profile contracts, serving the likes of DHL, FedEx, SingPost and TNT. Riverwood was also the company used by US-based online giant Amazon to establish its ‘2-hour PrimeNow’ delivery service in Singapore.
Any custom innovation beyond what has already been agreed between the parties will be appropriately monetised by the two companies, while Riverwood will offer its freight services as a partner to the Yojee freight network.
In a statement to the market, Yojee said that Riverwood’s calibre and presence in the Singaporean market make their deal “significant” from an operational and commercial standpoint. In accordance with Yojee’s standard pricing model, Riverwood will pay fees that are derived on a per transaction basis at an approximate rate of $US0.20 per transaction.
“As we have expanded and scaled we really needed to assess our technologies and it became clear that Yojee was best placed to help us with their unique network and partner focused model which includes route optimisation, which is the reality of modern logistics, but has not been catered for by other technologies we have assessed,” said Mr Syafiq Yussoff, CEO of Riverwood.
“Riverwood has been growing by 10% quarter on quarter and anticipates expanding into a new 35,000 square foot warehouse and buying more vehicles to handle growing demand,” added Mr Yussoff.
Flurry of deals
Today’s 2-year agreement with Riverwood follows on from earlier commercial milestones announced by Yojee earlier this year.
In March, Yojee signed a pilot services agreement with UPS Asia Group, a subsidiary of the United Parcel Service (UPS), to field test its blockchain-powered logistics technology. Two months prior, Yojee agreed on a partnership agreement with ‘Sinotrans Integrated Logistics Australia’ (SILA), part of China’s largest shipping and logistics company.
In its most recent deal, Yojee has signed a services agreement with DB Schenker Asia Pacific, as the first stage of a potential broader rollout of its services for DB Schenker’s operations further afield in other jurisdictions around the world.
The deal is a significant step for Yojee given that DB Schenker is one of the world’s leading global logistics providers that has been an industry leader for over 140 years. The company currently takes up a central role in supporting industry and trade in the global exchange of goods through land transport, worldwide air and ocean freight, contract logistics and supply chain management.
Its sheer size means Yojee will have its hands full if the two companies agree on a long-term deal later this year.
As part of its expansion, Yojee raised A$8 million through an oversubscribed share placement earlier this week. Yojee said it will issue 80 million fully paid ordinary shares at an issue price of $0.10 per share.
Proceeds from its capital raising are to be used to expand Yojee’s Asian market presence and further develop artificial intelligence, blockchain and logistics network interconnectivity. Yojee is also keen to expand its geographical sales presence, boost customer numbers and increase transaction volumes.
“Riverwood is a fantastic model of the modern logistics operator, with an agile approach to the rapidly changing demands of e-commerce demonstrated as mentioned by PM Lee Hsien Loong’s National Day Rally Speech as one of the success stories of Singapore’s new Digital Economy. Yojee looks forward to working with them to: scale their business and increase efficiencies; reduce costs per delivery; and delight drivers and customers,” said Ed Clarke, managing director of Yojee.