This also leverage Grab’s large supplier network to further expand the GrabSupermarket product line at lower costs
by FAYYADH JAAFAR
GRAB Holdings Ltd has completed its acquisition of a majority stake in Jaya Grocer Holdings Sdn Bhd.
Grab said this will accelerate its growth of on-demand grocery delivery service and provide consumers with more options and convenience.
Additionally, the acquisition enables Grab to bring more Jaya Grocer retail stores onto its marketplace, while also leveraging the latter’s large supplier network to further expand the GrabSupermarket product line at lower costs, which in turn contributes to improved unit economics and the overall affordability of grocery delivery.
Grab’s cashless wallet, GrabPay, will also be rolled out across all Jaya Grocer physical retail stores.
Grab Group CEO and co-founder Anthony Tan said it is the company’s vision to make on-demand groceries more accessible for everyone.
“Jaya Grocer is known for its wide selection of good-quality fresh produce and grocery products.
“By combining our extensive on-demand delivery fleet and capabilities with Jaya Grocer’s strong retail presence and supplier network, we can have these quality products delivered to more homes even faster,” he said, adding that the acquisition would also provide Grab with access to Jaya Grocer’s extensive distribution network.
Jaya Grocer founder Teng Yew Huat said the acquisition will help the company continue its growth trajectory and expand its reach into new markets.
“Grab’s strong track record and ability to execute in a hyperlocal way gives me confidence that I have found the right partner to take Jaya Grocer to new heights.
“This acquisition provides us with an amazing opportunity to not only grow as a company, but also grow the market for online grocery services in Malaysia,” Teng added.
The acquisition comes at a time when on-demand grocery delivery is experiencing rapid growth, especially as concerns about safety and hygiene have led consumers to shift towards online shopping during the Covid-19 pandemic.
It is estimated that online grocery in South-East Asia could grow to US$50 billion (RM209.3 billion) in gross merchandise value, which is the size of the entire e-commerce market today, at a 10% penetration rate similar to advanced markets.
Even as movement restrictions are lifted, online grocery demand will remain elevated due to concerns about safety and hygiene, which is proven by GrabMart’s three straight quarters of growth in the first three quarters of 2021.
Jaya Grocer has also seen continued strong growth, with revenues growing at double digit rates year-on-year from 2018 to 2020, and is Ebitda to Grab’s business.
As physical stores slowly return to normal operations, online stores have now adopted omni-channel retailing, where customers can order groceries through multiple channels, including in-store, mobile, and home delivery.
This trend has also been witnessed in other online grocery players such as Amazon.com Inc and Alibaba Group Holdings Ltd, which have opened physical stores to complement their digital offerings.