A view from 29-year-old Flash Express CEO Komsan Lee
A young man from a poor rural family in the border province of Chiang Rai has grown to head a multi-billion-baht company that is a key player in Thailand’s robust logistics industry.
Komsan Lee, chief executive of Flash Express, hails from the mountainous Doi Wawi village. His ambition to own a business was driven by poverty suffered by his family — he simply wanted to bring better lives of his loved ones.
Flash is Thailand’s first “unicorn” startup — a new business that is valued at more than $1 billion (Bt31.2 billion) — after just three years into operations.
The 29-year-old entrepreneur started his first business since his university days.
After managing to overcome poverty, he tackled more challenges in life, which he treated them like adventures. Komsan attained success in the community, provincial and national levels. Now he is setting his sights at the regional stage.
“Success is not easy to get and it has nothing to do with fluke. You need luck sometimes, but effort and determination are the key,” the CEO said.
Komsan had experienced failures so bad that he thought of committing suicide. But later he treated them as a valuable lesson.
He attributed his success to his supportive family, particularly his wife who was often ready to offer him encouragement when he was in low spirits.
However, Komsan says his business is still far from being completely successful. That day would come only if he could retire without worrying for the company’s future.
How to select a business to get involved
For the CEO, two factors that affect an entrepreneur’s selection of business investment are their potential and opportunity. If these factors are favourable, the entrepreneur has a better chance of success.
He chose to start a logistics business after years of doing business in many countries and witnessing continued growth of e-commerce.
“E-commerce is booming. Big players like Alibaba and Tencent have invested a lot in the sector.”
‘This is what we chose’
Komsan was highly confident and well prepared when starting his business. Thanks to his Chinese skills, he spent several months studying China’s e-commerce, logistics sector and related infrastructures. Also, he recruited some Chinese staff members.
He gained a good understanding about the differences between China and Thailand.
“We are a Thai company and I am Thai. I know what Thailand lacks. We were prepared to do the business but you can’t say the readiness was 100 per cent. When you are completely prepared to start any new business, your opportunity is already gone,” Komsan said.
Only six months after starting his business, he spent all his money. So, he began fund-raising and managed to attract the first investment of some US$4 million (about Bt120 million) from the United States.
In 2019, more investments came in from many companies. A year later, PTT OR, Durbell and Krungsri joined in boosting Flash Express’ strength.
According to Komsan, Flash Express’ goal is to become an integrated e-commerce provider. It is among the top three logistics firms in Thailand but he still sees room for improvement, particularly involving warehousing and support services for online vendors.
“We don’t see ourselves as the only Thai player. We still aim to enter all the 10 ASEAN countries. Today, our presence is in Thailand only — we have nine more countries to go,” the CEO said.
Beyond ASEAN, Flash is also eyeing many other nations with the potential for development of logistic infrastructures, he added.
E-commerce and its infrastructure
Retailing in Thailand is made through two major channels — the traditional way through 7-Eleven, Big C, Makro and grocery stores, and e-commerce via online forums like Facebook, Lazada and Instagram. Whatever means used, the vendors need logistics to get their products to the buyers.
Komsan said his logistics business caters for both e-commerce and offline retailing.
He foresees continued development in Flash Express modes of transport. “Today we use motorcycles, cars and other vehicles to deliver goods. In the future, we will use robots and drones,” the CEO said.
3 more logistics areas to cover
Although Flash Express is now among Thailand’s top three players, Komsan still sees a lot of room for improvement, as the company has achieved “less than 20 per cent” of what he wants to see.
“I am 29 today. I have 40 to 50 more years to reach my goal,” he said.
At the start of Flash, the logistics market enjoyed phenomenal growth — 7,800 per cent in 2018, 5,000 per cent in 2019, and at least 500 per cent in 2020, according to Komsan.
However, from 2021 onwards, the market expansion will not be that high although the CEO expects a continued growth of about 50 to 100 per cent.
Nevertheless, he expects related sectors like warehousing, technical and financial services to leapfrog like before.
Flash plans to start three new businesses in mid-2021, offering tools for online vendors to boost their sales, cut costs and raise their potential.
“We believe that when online vendors grow stronger, Flash will do too,” the CEO said.
China is logistics model that must be imitated
The Softbank owner once said the United States was ahead of Japan by 10 years while Japan was ahead of the rest of Asia by 10 years, and China was ahead of ASEAN by 10 years. Japan copied US success while the Chinese copied from the Japanese and ASEAN imitated China.
“Thanks to today’s rapid technological advance, we can spend just 5 years — and not 10 — to copy from the US or Japan. However, we are more associated with China, which can be compared to the US now in terms of technology and e-commerce,” Komsan said.
In China, almost 300 million parcels are delivered every day by more than 10 million delivery people. Flash Express can learn from 18 years of China’s experience in e-commerce and logistics before adapting the knowledge for Thailand.
Flash Express has invested heavily in the infrastructure for its logistics business.
“We have invested almost Bt10 billion in the infrastructure over the past two years. I believe good and strong infrastructure will draw in customers and bring profits in the future,” the CEO said.
Flash Express is the only Thai-owned provider of express delivery services among the top 10 players in the local market, Komsan says. “We believe they don’t understand Thai customers as well as we do.”
His company’s foreign competitors tend to copy the original concepts for use in Thailand while Flash Express adapts it to fit Thai people, the CEO notes.
“Our rise to become a top 3 proves that Flash understands Thais and Thais love Flash,” he said.
E-commerce has a lot of room to grow
China’s e-commerce has existed for 18 years but it is still growing almost 40 per cent annually. Thailand’s fledging e-commerce has come into existence for three to four years only. Competition in the market is not so fierce and there are only two major players in Thailand — Shopee and Lazada — with no global competitors.
Delivery service providers are benefiting from the growth of Thailand’s e-commerce market.
About 10 per cent of consumer-product purchases in Thailand are made online, and most of them involve fashion and luxury goods. That is compared to 30 per cent in China, where as many as 600 million parcels are delivered every day.
Komsan said he believed that e-commerce is an inevitable global trend and it will certainly bring changes to society. E-commerce makes life easier and becomes essential for people, he added.
However, e-commerce needs infrastructure to function and survive, according to him. Major infrastructure for e-commerce makes up of internet access, logistics and funds. China’s e-commerce success is attributed to the availability of those three factors.
As Shopee and Lazada are enjoying continued growth, social commerce in Thailand is prospering and vendors make their sale through Facebook, Instagram and Line. These people are Flash Express’ main customers and their businesses are growing.
Flash Express provides support to those vendors and helps to improve their sales through such tools as Flash Radar. The tool allows online vendors to better understand their customers through database containing such details as their address, frequency of purchases, and the punctuality of their payment.
Flash is not just a logistics service provider
“We are not just a delivery company — we are a provider of complete e-commerce services. We cater to the needs of online vendors and help them grow,” Komsan said.
Flash invests in many Thai startups while providing them with assistance, mainly involving technological development. And its ecosystem has millions of service users, according to the CEO.
Unlike other service providers, he said, Flash Express has built its own infrastructure, as well as delivery staff and warehouses, which helps the company to maintain efficient services while curbing costs in the long run.
Komsan pointed to inequality between urban and rural areas when it comes to access to e-commerce services, which he blames on a shortage of decent tools and transport systems in the remote regions.
“By the end of 2021, Flash will reach all villages in Thailand and help to bring equal opportunities between the urban and rural areas,” he said.
Aiming to pick up parcels at every Thai village
At present, Flash delivers about 1.3 million parcels of goods a day, among the highest in Thailand. Deliveries can be made in every village and the company can pick up parcels in every village by the year’s end.
Flash offers the service of picking up parcels at home free of charge anywhere in Thailand. It still cannot do daily pickup in remote sub-districts now, but that restriction will disappear by the year-end.
“We have 22 distribution centres all over Thailand, which we claim to be the best in this country. We invest more than Bt300 million in every warehouse. They are equipped with automated machines capable of sorting more than 40,000 parcels an hour, and up to 100,000 at a large warehouse,” Komsan said.
The CEO affirms that Flash is 100 per cent Thai startup. “Alibaba does not hold any shares in our company. We are pleased to serve any platform neutrally — whether it’s Shopee or Lazada, as well as any online vendor. We simply hope to help support Thai-owned businesses for their success,” he said.
Flash recently was granted a payment permit by the Bank of Thailand although the company has yet to offer the service. E-commerce is still its main business. At present, Flash has 27,000 employees throughout the country, and the number will almost reach 40,000 at the end of 2021.
“I am very proud that we are the first Thai startup to be able to compete against foreign players. And we will be the first Thai startup to make a foray into the foreign market,” Komsan said.
The secret of managing a large corporation
Owning and running a business requires the courage to leave your comfort zone and to share your power with professionals who can help you manage your business.
“I am no longer at the frontline now, more than two years after the company was established. I work behind the scenes, focusing more on social work, overseas investment and strategies. We have a thousand capable managers all over Thailand. I am not so good that I can do it all alone,” the CEO said.
The CEO set up Flash Express at age 26
Komsan stresses that everyone has equal opportunities to become successful. “I came from a remote area with less opportunity than others, but I have come this far today. So, I believe everyone can do it.”
People should not allow failures to block their path to success, he says. “Failures never stopped me from developing further. Failures let me grow. They gave me experiences and lessons that brought me to this point today.”
For him, entrepreneurs need to be ambitious about learning new things and tolerant of difficulties and pressure.
He slept no longer than four hours each day after starting his business. As a result, he fell ill and was hospitalized for many days. However, he went back to work the day he was discharged from hospital.
The CEO praised his 30,000-plus employees for their devotion to the company. He also said that he was proud to ensure more income for them than their counterparts in other companies. For instance, his delivery staff members each earn almost Bt40,000 a month.
“There is no fluke. You may benefit from a stroke of luck sometimes. But apparently, we relied more on efforts to reach this point today,” he concludes.
