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Lalamove Business Model – How Does Lalamove work

By Tanvir Singh 7th December 2020

Lalamove: A logistics aggregator blending lifestyle and logistics!

India’s logistics market is expected to grow at a CAGR of 10.5% between FY19 & FY25. With tech-savvy customers, ever-changing technology, and intense competition in e-tailing, getting products delivered to the customers as fast as possible becomes imperative. Lalamove emerged as the solution to ‘how to provide one-day delivery to your customers’’ Be it the ‘Uber for logistics’ or ‘Where lifestyle meets logistics,’ Lalamove has earned these titles and always lived up to them.

About Lalamove

Lalamove is an on-demand and same-day delivery service that connects delivery drivers with users via web and mobiles. Lalamove is headquartered in Hong Kong and spanned across 21 Latin American and Asian cities and acted as a connecting bind between 7 million+ customers and over 7 lakh delivery drivers. It has an impressive record of 90 million-plus completed deliveries and 6 seconds average match time. Lalamove is a family of more than 1400 employees. Lalamove has changed the face of shipping by eliminating the need for the customers to go through the conventional shipping methods that are embedded with hassles. Lalamove is essentially a crowdsourcing model to logistics that aids in the swift transportation of goods from one source destination.

How Lalamove was set afloat

Lalamove was the brainchild of Shing Chow and was initiated in 2013. The genesis of Lalamove was inspired by the need to cater to a definite logistical need, i.e., van hire. Originally it was christened ‘Easyvan,’ and it was renamed ‘Lalamove’ in 2014. Lala is a Chinese word that means ‘to deliver’ Earlier, Lalamove banked on the tagline ‘Everyone’s private driver.’ They soon changed it to ‘Where lifestyle meets logistics’ to communicate their business to the world. These changes were made to publicize the direction they were heading towards. Lalamove is famous for also being the first unicorn that was born out of Hong Kong.

The mechanism behind the idea

Lalamove operates web and mobile applications via which they connect delivery drivers with users. Applications are free to download and can be easily found on Play Store and iOS stores. For delivery drivers, there’s a distinct and separate Lalamove driver app. Users are given the option of choosing drivers and courier services, and even delivery vehicles. However, the delivery vehicles might vary from city to city. Lalamove also offers API integration to business platforms that aspire to integrate the delivery booking mechanism into their systems with the ultimate intention of providing seamless services for huge customer orders. The app makes use of Google Maps for navigation and tracking purposes. A standard fee schedule is followed.

Value offerings by Lalamove

“Just Lalamove it” is what Lalamove used to motivate users to trust them for their reliable deliveries. Lalamove aims at devising the most cost-effective and trustable method for transporting goods. They make use of technology to ensure efficiency for the last-mile delivery, bringing additional benefits like reduction in wastage of time and resources as well. Lalamove also provides an account manager facility to help you in scaling up your deliverables.

Business Model of Lalamove

The business model of Lalamove is that it helps customers save money and helps drivers increase their business. Lalamove follows a fee-based and commission-based model. It allows deliveries of all forms and sizes for big business and corporate houses, i.e., the B2B segment, their primary target market. Companies from industries like construction, retail, e-commerce, manufacturing, food and beverages, and trading & distribution rely on Lalamove to outsource their deliveries. Lalamove enables both SMEs and individual users to push their goods across with either single or multiple drop-offs so that users don’t have to make numerous bookings per delivery. They also focus on the B2C segment. Via the app, the users need to specify the delivery vehicle type they want and then feed the pickup and drop locations. Nearby drivers then receive lists of requests on the Lalamove driver application, a distinct app for the drivers who want to deliver.

The current and future scenario for Lalamove

After the advent of COVID 19, Lalamove initiated its CSR initiative called Deliver Care, which intends to provide free delivery to NGOs. The CSR initiative proactively delivered over 2 lakh essential items like sanitizer, PPE kits, face masks, and food to not just Covid warriors but underprivileged families too. Lalamove also partnered with the government of Quezon City and initiated LalaJeep, a brand-new delivery type featured on the app to help jeep drivers who were displaced from work because of the community quarantine. Lalamove is optimistic about being able to fuel the growth of the logistics sector by embedding transparent pricing and cloud base GPS tracking in addition to the existing tech used.

Way ahead

With the B2B boom, Logistics is considered to be the darling of investors and start-ups alike. India’s logistics market is expected to grow at a CAGR of 10.5% between FY19 & FY25. With over 22mn+ employees, this sector is anticipated to be one of the largest job creators by 2022. There are many unicorns in this domain. The biggest and most expensive challenge for this industry is the last-mile delivery. With the current trend of businesses moving online, the company has many opportunities to explore to ensure reliable and timely deliveries. Consequentially logistics has become an integral part of the value chain.

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