Lalamove unit aiming for profitability within 2 years
Lalamove Thailand, an on-demand delivery service provider, is gearing up for profitability in 2024 by ramping up its services upcountry, increasing the number of corporate users and shipping large-sized goods amid economic challenges.
In 2021, the Hong Kong-based firm raised US$1.3 billion in two transactions of its Series F funding round led by Hillhouse Capital, an earlier investor.
“We intend to expand the business to cover mid-mile and last-mile logistics to respond to the needs of customer groups, individuals and SMEs, along with corporate users to capitalise on opportunities in the market,” said Ben Lim, newly appointed managing director of Lalamove Thailand.
Despite economic challenges and rising fuel costs, logistics is still the backbone of the country’s economy, Mr Lim said. Thailand’s logistics industry is expected to expand by 5-10% this year.
In 2021, the logistics market was worth 730 billion baht.
Lalamove Thailand will increase the number of drivers of large pickup trucks in order to cater to mid-mile and last-mile delivery and the shipment of large-sized parcels.
In Thailand, 70% of the firm’s revenue comes from individuals and 30% from SMEs or corporates, Mr Lim said.
The company aims to increase its range of delivery vehicle options in order to support corporate users.
“We will expand beyond food delivery and focus more on on-demand delivery as well as scheduled and contract delivery,” said Mr Lim, adding that the company offers competitive prices.
According to him, the company will usher in technology to analyse the patterns of riders’ driving and suggest how to minimise their fuel costs and maximise support for customers in order to achieve improved earnings.
Unlike other logistic services, Lalamove Thailand provides an on-demand delivery platform that matches demand and supply, he said. The firm does not have a lot of fixed costs and operates flexibly.
Mr Lim said Lalamove Thailand expects to reach profitability by 2024.
Within two years, Lalamove will expand upcountry and cover all the regions with an annual revenue growth of around 50%. The company now has 150,000 drivers.
“If we can make profits, Thailand would be one of the top three markets for Lalamove in Southeast Asia,” said Mr Lim.
Within Asean, the company has its business footprint in Indonesia, Vietnam, the Philippines and Singapore.
Its services have reached 30 cities throughout Asia and Latin America with more than 1.5 million driver partners and over 8 million registered users worldwide.
The company recently unveiled its first local brand ambassador — Puttiping Assaratanakul or “Billkin” — to represent a young entrepreneur in its advertising campaign, which could potentially stimulate interest for the firm’s services among SMEs.
‘‘ Logistics is still the backbone of the country’s economy. BEN LIM Managing director, Lalamove Thailand