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South Korean unicorn joins Vietnam’s food delivery scene

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Grab and Now, which both operate in the food delivery sector, are now competing with Woowa Brothers, a South Korean unicorn valued at $2.6 billion, which has taken over Vietnammm.com.

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More and more businesses join the food delivery market

 

A unicorn is a privately held startup company valued at over $1 billion.

Joining the market in February 2012, Vietnammm.com was considered a pioneer in the website-based food ordering market. With the number of internet users accounting for more than 30 percent of the total population and most of them young, Vietnammm.com quickly gained an impressive growth rate and became a partner of Takeaway.com just one year later.

The great potential of the market then attracted other players, including Foodpanda.vn of Rocket Internet and chonmon.vn of VC Corp which emerged in 2012. Prior to that, VC Corp took over Eat.vn, a food ordering website established in 2011. 

Vietnammm’s revenue mostly came from orders on the website, about 15-20 percent of value of each order. It did not develop delivery staff of its own because of the high cost.

Foodpanda once had a delivery division with 100 workers in Hanoi and HCM City. The division cost the company hundreds of million of dong each month. Later, Foodpanda was sold to Vietnammm because of the cost burden.

In 2015, the website could get 30,000 orders a month, according to Vietnammm’s CEO Jochem Lisser. Sources said the figure is 45,000 now.

As for Woowa Brothers, it owns Baedal Minjok a food delivery platform in South Korea. The takeover of Vietnammm is expected to help Woowa Brothers save time entering the Vietnamese market.

Euromonitor has noted that Vietnam is a hot market, with value of $33 million and $38 million by 2020.

There are many service providers in Vietnam, including the two biggest – GrabFood and Now. Sources said GrabFood takes 24,000 orders a day, while Now has 18,000.

There has been no information from Woowa Brothers or Vietnammm about strategy in Vietnam. However, analysts believe that Woowa Brothers will continue expanding business and will not only operate in the food delivery sector but also in daily-use and fashion products.

According to Hoang Giang, former marketing director of LalaFood of Scommerce, the goal of O2O platforms like Grab is fintech.

Analysts see a high possibility of Woowa Brothers following that way, because this would attract more partner drivers, who are the major weapon in the delivery battle.

 

Source: VietNamNet

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