Rethinking fleet ownership in a changing business landscape

Something has shifted in the conversations I have with small business owners in Singapore over the past couple of years, and it isn't about how fast a parcel can move. It's about who should be responsible for getting it there, whether a business needs to own and run its own delivery operation, or whether there's a better way to achieve the same result.

For many businesses, owning a fleet has long been associated with having greater control. It's easy to understand why. If the vehicles, drivers and schedules are yours, surely you have full visibility over the customer experience. But in my experience, control means very different things depending on the size of the business and the resources available to support it.

That question used to have a relatively straightforward answer. Years ago, if a business needed regular deliveries, it would buy a vehicle, hire a driver and manage deliveries internally. Today, with Singapore's eCommerce market having crossed SGD 34.4 billion last year and projected to reach SGD 40.5 billion by the end of 2026, that calculation has become far more nuanced.

Larger enterprises often have dedicated teams, governance structures and operational resources to manage their fleets effectively. SMEs, however, often don't have the same resources. As demand fluctuates, maintaining that level of control becomes much harder than many business owners initially expect.

Customers stopped forgiving the wait

Delivery used to sit quietly behind a business, doing its job without anyone paying much attention to it. That's no longer true. A decade of ride-hailing and food delivery apps has trained an entire generation of shoppers to expect visibility as a baseline, not a bonus. Customers want to know not just that something is coming, but when it will arrive, where it is and what to expect throughout the journey.

The consequence is that delivery has quietly become part of the product itself. A furniture piece that arrives a day late isn't experienced as a shipping delay. It's experienced as a business not quite delivering on what it promised. Customers rarely separate the courier from the brand that hired them.

Five years ago, many businesses viewed delivery as something that happened after the sale. Today, it has become part of the overall customer experience. I'm seeing more business owners, particularly younger entrepreneurs and the next generation taking over family businesses, paying closer attention to service reliability, delivery quality and customer satisfaction rather than simply focusing on delivery costs.

Businesses are also investing more in packaging and branding, which naturally raises expectations around how products are handled during delivery. Once you've invested in creating a premium customer experience, you want every part of that journey, including delivery, to reflect your brand.

Technology has quietly rewired what "logistics" means

Technology hasn't simply made deliveries faster. It has fundamentally changed how businesses manage logistics.

Even something as familiar as tracking has evolved significantly. Years ago, customers were satisfied with basic updates such as "item picked up" or "out for delivery". Today, businesses and consumers expect much more. Live driver locations, real-time delivery visibility and direct communication with drivers have become increasingly common expectations.

Technology has also improved proof of delivery. In Singapore, where unattended deliveries have become more common, digital proof of delivery helps businesses reduce disputes, minimise failed deliveries and avoid unnecessary redelivery costs.

At Lalamove, we see this shift every day. Businesses that once relied on on-demand delivery only during peak periods are increasingly making flexible logistics part of their everyday operations rather than treating it as a contingency plan.

The hidden cost of control

Owning a vehicle in Singapore has never been cheap, and it hasn't become any easier. Certificate of Entitlement (COE) premiums for commercial vehicles remain a significant upfront investment.

In my experience, many SMEs only calculate vehicle financing and driver salaries when assessing fleet ownership. In reality, those costs often represent only part of the overall picture. Businesses also need to consider insurance, maintenance, ERP, parking, CPF contributions, leave entitlements, fleet management and the time required to oversee drivers. Those hidden costs are often overlooked.

The question therefore is whether a business has the operational resources to manage one effectively. Control only creates value if a business has the people, systems and flexibility to support it.

The question businesses should really be asking

I've stopped asking SME owners whether they should buy a vehicle. It's the wrong question because it invites a yes-or-no answer to something far more complex.

The better question is this, if you mapped your order volumes over the past 12 months, how much of it would sit on a flat line, and how much would resemble a series of spikes? A flat line may justify fixed infrastructure. Spikes justify flexibility, the ability to scale delivery capacity up when demand increases and back down when it doesn't, without carrying the cost of underutilised assets in between.

Businesses should also think carefully about how they evaluate logistics partners. Cost will always matter, but choosing the cheapest option can sometimes create bigger problems if service quality suffers. Delivery is ultimately an extension of the customer experience, and poor service can damage trust far more quickly than businesses realise.

Today, control isn't necessarily about owning every vehicle or employing every driver. It's about having the flexibility, visibility and technology to consistently deliver the experience your customers expect.