Sharp uptick in delivery demand not without challenges, says Ninja Van CEO

Sharp uptick in delivery demand not without challenges, says Ninja Van CEO

Photo: Ninja Van

Southeast Asian delivery player Ninja Van may be on the less glamorous end of e-commerce, but it’s tracked the same pandemic-induced spikes in online shopping’s trajectory.

The increased demand for delivery wasn’t all roses, Chang Wen Lai, CEO at Ninja Van, told DealStreetAsia, noting it also brought higher costs and struggles to maintain social distancing for workers, as well as shifts in consumer patterns.

The volume increases varied by market, with some countries imposing stricter lockdowns than others, Ninja Van said, adding Singapore volumes surged around 80 per cent in April, during the “circuit breaker” period, and are still around 20 per cent higher on-year.

While the volume spike has tapered off, “it’s higher than what was before this, which is why I think there are real structural changes in the e-commerce landscape,” Chang said.

Even before the pandemic erupted this year, the e-commerce sector in the region was growing fast.

Southeast Asia’s internet economy crossed the $100 billion market in 2019, up by around 40 per cent on-year in gross merchandise value (GMV) across the online travel, e-commerce, online media and ride-hailing sectors, according to a 2019 report from tech behemoth Google, Singapore state-owned investment company Temasek and consultancy Bain & Co.

The region’s internet economy is expected to hit $300 billion by 2025, the report said.

E-commerce in the region topped $38 billion in 2019, beating previous projections, and was on track to climb over $150 billion by 2025, the report said.

In what may be a sign of e-commerce’s growing importance in the region, Ninja Van raised $279 million in April in a Series D round led by Geopost and Brunei’s sovereign wealth fund Zamrud, according to Crunchbase data. Bangkok Bank, Carmenta Capital, B Capital Group, Intouch Holdings, Golden Gate and Grab also participated in the round, the data show.

In addition, ride-hailing giant Grab made an undisclosed investment in Ninja Van in April 2019. The move was set to expand GrabExpress’s delivery services from on-demand, same-day parcel, and courier delivery service to include more options such as nationwide deliveries.

Edited excerpts of the interview:

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