Home ›› 31 Jul 2022 ›› Business Connect
Initial days of using technology, when it comes to e-commerce, are very difficult but if one builds up the infrastructure and once it gets rolling there is no looking back because the business will then begin to scale up like crazy, said Ambareen Reza, founder of foodpanda, the largest food and groceries delivery platform in Bangladesh.
Since its inception in 2013, foodpanda Bangladesh has managed to create a culture of reaching food from reputed restaurants and home-based businesses right at people’s doorsteps by simply running their fingers across foodpanda app.
Dhaka has unbelievably crazy traffic and most restaurants can’t deliver food at people’s doorsteps.
Surging middle and upper income people and food lovers are present in the city in great number. They are searching for someone to settle the crisis but no one has been able to come up with any suitable solutions.
Ambareen Reza, who is a qualified Chartered Accountant from Australia, pored over the need of people and planned to lessen the distance between food customers and restaurants or cooking agents.
Ambareen Reza’s innovation and top-notch technology clicked in her food aggregator business very well making it one of the most popular food delivery ventures in the country.
In only nine years, foodpanda has digitally transformed more than 35 thousand businesses who are selling their food, groceries and home-cooked meals across the country.
It has around 1200 full-time employees and many other contractual employees, more than 15,000 active riders who have chosen the platform as a means of earning.
Foodpanda has generated more than 100,000 income opportunities directly and indirectly for the youths and supporting home-based entrepreneurs to earn money.
It has 30 warehouses of its own countrywide while 16 are operating in Dhaka.
All these were possible due to the cofounder’s business acumen sharpened by her line of educational background and vision along with sheer hard works by harnessing the technology.
Ambareen’s education
Born and brought up in Dhaka, Ambareen Reza completed her O’ level from Aga Khan School and A’ level from Scholastica Pvt Ltd.
Later, she went to Australia in 2006 with a scholarship to study Accounting and Finance at Macquarie University and graduated with Dean’s Merit list in 2009.
She was recognized for his outstanding academic excellence in each year of University education and also received Letter of Excellence from the Vice-Chancellor and from the Head of Microsoft Australia.
She qualified herself as Chartered Accountant at the Institute of Chartered Accountants Australia during her spell in between 2010 and 2012.
“While pursuing chartered accountancy, I was lucky to see both inside and outside issues of business during my attachment with the industry,” she said.
From that learning, she came to realize that traditional accounting was not comfortable for her while she was very good at understanding different things and analyzing processes and looking at bigger landscape.
Embarking on a career
Ambareen started her career as a Finance Officer at the Institutional Advancement Finance Office in Australia and later as a Senior Financial Analyst at Ernst & Young in Sydney.
She worked as Business Performance Analyst at Sydney’s Dollar Thrifty Automotive Group from Jan 2013 to May 2013.
“All my life, I have never settled for the norm. But I have never misused the freedom my parents had given me to become a chartered accountant,” she said.
In 2013, she decided to return to Bangladesh after living 9 years abroad. She knew she would have to do something impressive.
She joined as Country Director of Bangladesh at Berlin-based internet company Rocket Internet SE on Jun 2013.
Rocket Internet launched ventures - Lamudi and Kamudi-- in real estate property dealings but it did not interest her as she always wanted to see business sustainability.
“I saw that real estate secondary market was non-existent in Bangladesh. Usually, people buy new homes from land developers or building developers. But it would entail huge investment which rocket internet would not do for our venture. Then I came out of the business model and in fact I resigned after six months,” she said.
Emergence of foodpanda Bangladesh
While working for the Rocket Internet, she along with her colleagues frequently asked office staff to bring food for them. As it took time and the staff would toil on busy roads they discussed how to set up a food delivery company in Dhaka.
In Australia, she said, she frequently would order food through the leading online ordering platform ‘Menulog’ and thus she came to know about the idea of food delivery.
Then food delivery was talk of the town, globally earning a lot of money. India was specifically doing well.
No business can grow as fast as online businesses, she said. “I love food and so the choice to establish a food delivery business inevitably came into my mind.”
She shared it with one of her friends named Ralf who was a global founder of Rocket Internet and insisted him on doing it together. He agreed and she started her journey.
Initially they were only four with her Co-Founder Zubair Siddiky. Rocket gave a table for a single room office at Banani. Later they took a separate office at Banani.
“We started in a small room in the Rocket Internet office and targeted covering only Gulshan, Baridhara and Banani. We would not do delivery. We took help from a third party ‘Aramex’ for delivery,” she said.
The first restaurant she signed with was ‘Life Kitchen’ at Banani. She showed customers on her laptop many global websites that were working with food delivery and promised to build such a platform in Bangladesh.
Initially, they wanted only to take orders but one month into the business, they came to realize that it was not possible without e-commerce logistics. They then started providing logistics support.
“At the beginning we would promise sixty minutes and even that sixty minutes were also a big challenge in the given situation,” Ambareen was reminiscing.
Customers would give orders through their sites and immediately they had to text messages to riders. They had to move from phone call to applications and later to devices and now towards the state-of-the-art technology.
It all started on 27 November 2013 as a trial run and it went into official operation on 1 December 2013. “We received money in May of 2014 for the first time and it took six months.”
Initial investment was their salaries. They were actually bootstrapping with their 3-4-month salary for the venture. They took their office from January in 2014.
“We were carrying out digital marketing on facebook and shared our ideas with friends and families. We celebrated our one hundred orders at our offices. I can still remember.”
The initial days are hard but the best part of technology, when it comes to e-commerce, is ‘once you build the infrastructure it starts working and that’s a beauty as you begin to scale up like crazy’.
The business, she said, scaled up during pandemic when everything was shut down foodpanda reached out to all 64 districts with the help of e-commerce, she said.
From January to February of 2020 the growth of the business was almost 50 per cent. In March, it stalled. Between 2019 and February 2020, the year on year growth was 1200 per cent.
The business has evolved over time. Customer services have also evolved. “We have now completely automated the process.” The business proposal was coined ‘Hot Delivery’.
“One of the beauties of foodpanda is it taught me that working in local start-up is something but global fund raising for global start-up is completely different,” she explained.
Foodpanda was sold to Berlin Based ‘Delivery Hero’ in 2016 when it was still very small. The agreement was signed on 31 December and it was a major breakthrough and after that ‘we did not have to look back.’
Having the support of Delivery Hero means further improving the service essential to meet the global standard and attain greater access to tools and experience.
Soon, it overtook other food delivery platforms in the country to climb up to the top position. “We had scopes to use their expertise, learning and networking. They invested a lot of capital and gave us the growth capital.”
foodpanda launched all ground breaking initiatives like Pandamart, Shops, Pick-Up, foodpanda for Business, pandakitchen, Pandapro, Pandago based on the people’s need that propelled it to a new height and differentiated it from other contemporaries.
Q-commerce, a tiebreaker
Traditional e-commerce and quick commerce are different. E-commerce traditionally delivers products from warehouse while quick commerce delivers products from outlets or micro-warehouses.
When it comes to logistics, foodpanda runs in hyper-local model that ‘we have brought into the market’.
Its recent initiative ‘Pandamart’ has been the only online food and grocery delivery service to cover 64 districts with the largest network of partner restaurants, shops, home chefs and riders. It delivers products in thirty minutes for 24/7.
foodpanda has been one-stop marketplace from where one can get one’s purchase within thirty minutes, meaning that it provides instant delivery.
Q-commerce is probably her biggest focus. She thinks the introduction of q-commerce in Bangladesh has helped to show people that online delivery is integral if they want things done quickly and conveniently.
Ensuring food quality
She said they have arrangement for customers to rate their services based on delivery service, food quality, behavior and they observe the operation matrix of restaurants, home chefs and shops.
“We train them if necessary and we also give packaging support if they want.”
Strengthening home chef programmes to support home-based entrepreneurs to help them earn a living while preparing healthy, delicious and affordable home-cooked meals available to customers.
Home chefs currently constitute 2-3 per cent of their business, she said.
About Market
Bangladesh is a land of 160 million people. Korea has only 20 millions but they make 100 million orders per month, meaning that a person orders about five times a month and it is still growing by 30-40 per cent year on year.
But Bangladesh has only 20 million orders monthly which means this market is still growing at a minimal rate.
She attributed the reasons to lack of awareness and less number of smart phone users. Besides, people who have smart phones don’t know the use of it.
They don’t know that a smart phone can be a potential device to earn money or can ease their livings. People don’t want to trust food cooked outside their houses.
They should trust the food quality of restaurants and restaurants also has to ensure quality of food, hygiene, nutritional and cleanliness issues, said the founder of foodpanda.
In other countries, people do not differentiate hygiene between home-made or restaurant foods. She questioned why Bangladesh shouldn’t do the same.
The online delivery business is still fairly new in many parts of Bangladesh and foodpanda has played an important role in involving people in online business to earn a living.
Online food and grocery delivery industry has immense potential. It is growing almost every day.
There is still huge headroom for growth of this sector and foodpanda is consciously raising awareness and trust among people to facilitate digital transformation of the retail sector, she thinks.
Dream
Now her dream is to bring dine-In people into their apps. Every month she would like to receive five orders from per active population.
“I want to see more vendors move their businesses to online so that they can reach even larger audiences,” she hoped.
She is excited to see more cloud kitchens and cloud stores so that products and meals become widely available.
“And most of all, I’m looking forward to seeing the ways in which q-commerce moves the industry forward and helps to make the digital economy more pervasive and present.”
Foodpanda delivers everything that people need within 30 minutes. The industry should grow at a greater scale and faster.
Her dream is to reach upazila level but it is not being possible at present due to lack of logistics, supply chain and restaurants there.
The government has recently taken initiatives to improve the supply chain across the country.
It has launched cold storage supply chain through postal services. If the government provides subsidy on the initiatives then cost of logistics will come down and quick commerce will be available countrywide.
In addition, she said, she wants to support local start-ups to flourish through giving them a platform where they will get mentorship, support in terms of networking, fund-raising and increasing global connectivity.
For newcomers
Anybody who wants to come into quick commerce businesses have to be different in every aspect, may it be in technology or in services.
Having the right team and the last but not the least is execution. Nothing is more important than execution.
Start first, if fails, learn from your failure and then start again. Life of an entrepreneur is never easy and you have to be learning. Listen to people or target people, she emphatically suggested the newcomers in such business.
They have to carry out their research and improve continuously and be agile. There are no shortcuts and there is no stopping, she advised.
