PETALING JAYA: Having engaged the services of a courier company since last year, an online entrepreneur had little idea it was an unlicensed operation until his parcels went missing last month.

       Wanting to be known only as Mr Lee, the 48-year-old said the agent he dealt with was unable to trace the whereabouts of six parcels, and he had to replace the products for his customers at his own cost.

       “I have been selling some grooming accessories online since last June to supplement my income as my salary as a salesman was cut by 60%.

       “A friend of a friend approached me and promised to offer the lowest delivery rates. I agreed because it was really cheap,” he said.

       Lee, from Kuala Lumpur, said he was not aware that a courier service company needs a licence to operate, adding that he was still waiting for his refund from the agent.

       Lee said he was given a tracking number for each parcel but all it said upon checks was “no results found”.

       “My customers said they still had not received their orders after waiting for two weeks, while it previously took between three and five days.

       “Had I known it was an unlicensed company, I would not have engaged it,” he added.

       A courier service operator based in Shah Alam, who only wants to be known as Yeap, claimed that there have been many such illegal service providers following the first movement control order imposed on March 18 last year.

       “Delivery services became ever more important as people stayed indoors more since the Covid-19 pandemic.

       “Having been in the logistics business for 10 years and in the courier services for five, I have never seen so many budding entrepreneurs jumping into the industry like they are now,” said Yeap, who is the manager of a courier services company.

       He said many of his peers had noticed illegal courier service companies being set up in the country after the first MCO.

       “For example, in Kluang (Johor), there were up to four new operators in just about three months.

       “It was shocking and when we checked, they didn’t have a licence from the Malaysian Communications and Multimedia Commission (MCMC),” said Yeap, adding these unlicensed operators have made it unfair for those that comply with laws and requirements.

       “We are suffering from stiff competition and thin margins.

       “Often backed by local funders and some foreign entities, the unlicensed operators practise price dumping, disrupting the market by offering extremely low or even free delivery,” he said.

       As of now, Malaysian law only sets a base price for document delivery at RM4.50, with no similar rule for parcel delivery.

       “This eventually leads to a price war and a possible compromise on the workers’ salaries and welfare.

       “On top of these questionable services, in the event of any mishap, they are not covered by insurance,” said Yeap, adding that currently, there are more than 10 unlicensed courier service companies in the Klang Valley alone.

       Courier service agent Ray Tan said the unlicensed operator often starts out by growing the fleet by sending out “investment opportunity” calls to get interested entrepreneurs to join, then sets up area agencies and recruits local agents.

       “The investment amount ranges from as low as RM10,000 to RM80,000 for premises rental, business set-up, purchase of motorcycle or van as transport and staffing, depending on the size of the agency.

       “In an actual and legal scenario, all these requirements would cost between RM30,000 and up to RM100,000 or more, after factoring in all the payments for due diligence and licensing,” he said.

       Tan, who is based in Kuala Lumpur, noted that Malaysia recorded an increase of up to 28% in online sales in the first quarter of this year compared with last year.

       “The MCMC has frozen the issuance of new courier service licences for two years starting Sept 14 last year to allow the government and the industry time to formulate new plans to strengthen the industry through a government-industry forum.

       “Amid these efforts, the emergence of unlicensed operators is detrimental to the industry because it gives us law-abiding players a bad name when mishandling and malpractice happens.

       “To strengthen the industry, I hope the government will first take action and weed out these illegal operators,” he added.