As Grab expands to food and finance, its transport business is no longer driving most of its growth
- Food and financial services now make up more than 50 per cent of Grab’s gross merchandise volume, according to Lim Kell Jay, the regional head of GrabFood
- The margins for food delivery are better than for ride-hailing, Lim says
Despite being known mainly as a ride-hailing company, Grab’s transport business is no longer the key driver of its growth.
With the company expanding into other services in the past few years, food and financial services now generate more than 50 per cent of the Singapore-based company’s gross merchandise volume (GMV), according to Lim Kell Jay, regional head of Grab’s food delivery service GrabFood. GMV is the total value of sales transacted across the platform.
Grab, which first started out as a taxi-hailing company seven years ago, is valued at US$14 billion. And the company is betting on food delivery and financial services as the next big engines of growth.
“We started off as a ride-hailing company and built up this user base, and saw the opportunity to provide more services to users,” Lim said. “[That way], we get to engage customers more, and they will transact more on our platform.”
Grab’s move into food delivery and financial services, like payments, comes as transport-hailing companies – notorious for being either low-margin or loss-making – look to expand outside ride-hailing for growth and profitability.
