Lalamove from Hong Kong has kissed its ambitions good-bye after proving unable to beat Grab and Go-Viet to seize the local delivery market and has called it quits.
|Lalamove will focus on online business solutions for restaurants |
Similar to ride-hailing and e-commerce, investment in food delivery is a race of heavy investment to secure a large market share. In this battlefield, players with smaller financial potential and less competiveness are easily beaten – a lesson highlighted by Lalamove’s failure.
Accordingly, after only three months of its launch, Lalamove’s food delivery application named Lala: Food Delivery has completely disappeared from the iOS and Android app stores. Furthermore, the food order function on its website lala.vn no longer works.
Based on information announced on the website, there is a high chance that Lalamove will transfer its business form B2B2C (business to business to customers) to B2B (business to business). Thus, Lalamove will focus on business solutions for firms and quit delivering food to customers.
|Lala: Food Delivery application is no longer downloadable to iOS and Android devices |
When it entered Hanoi in October, Lalamove set the goal of employing 10,000 drivers by the end of the first quarter of 2019 to directly compete with Grab and Go-Viet thanks to its backing from Scommerce Group as well as its brother Ahamove’s 10,000 shippers.
Despite high demand in urban areas, the local food delivery market is not a fertile ground for many firms because of low profit. A representative of a firm running in the segment stated that in favourable conditions, profit growth could reach 10-12 per cent. Food delivery requires preservation, swift delivery, and separate storage space from other kinds of goods like clothes.
As a result, in a fierce battlefield, it is unavoidable for weak players to keep dropping out. Before Lalamove, the market also saw the retirement of Foodpanda which decided to sell itself to local food delivery company Vietnammm.
Lalamove was established in late 2013 under the name EasyVan. The Hong Kong delivery service has come to be known for delivering goods within an hour, and was named the “Asian Uber.”
Lalamove as officially launched in Hanoi on October 3, following a year of operations in Ho Chi Minh City. Focusing on clients in urban areas and committing to deliver goods within 55 minutes, Lalamove was forecast to be a redoubtable opponent to Grab and Go-Viet, another newcomer.