Southeast Asia’s F&B industry hungry for opportunities beyond delivery

In The Checkout this week, we map out the foodtech players in Southeast Asia and make sense of Cars24's exit from Indonesia. [Read from your browser]( The Checkout 🛒 --------------------------------------------------------------- Welcome to The Checkout! Delivered every fortnight, this free newsletter breaks down the biggest stories and trends in ecommerce. You can find past issues [here]( or [sign up here]( to receive future newsletters. Also, If you’re not a subscriber, get access by [registering here](. Written by Jofie Yordan Journalist Hello {NAME} Some time ago, I tried to find the physical space of a pasta restaurant I often ordered from via food delivery platforms. The address was close to where I live. However, I could not find it. Maybe I had the wrong address? Apparently not. It turned out the pasta dishes were sent out from a cloud kitchen - no wonder I couldn’t find the restaurant! Several F&B brands in Jakarta have been using cloud kitchen over the past few years and significantly increased during the pandemic. Cloud kitchens are a subsector of the foodtech industry, along with food delivery, which is more established. There are also players engaged in point-of-sale systems and restaurant management and reservations as well as F&B chains and alternative protein makers. This week's Big Story is a landscape map of Southeast Asia’s foodtech players. Apart from identifying foodtech companies across the region, I also detail the sector’s growth and the funding that has been raised to date. Notwithstanding the current economic climate, investors still seem interested in backing foodtech startups. Legit Group, Uena, iSeller, Runchise, and Wahyoo are among those that have secured new capital in recent months. Meanwhile, in this week's Hot Take, I look at the reasons why used-car marketplace Cars24 exited Indonesia recently. Stiff competition is likely one of them. -- Jofie  --------------------------------------------------------------- THE BIG STORY  [Mapping SEA’s food tech players: Startups seize opportunities beyond food delivery]( The last three years have been important for the foodtech scene. The pandemic - and the succeeding economic recovery - have changed the landscape.  ---------------------------------------------------------------  THE HOT TAKE Making sense of Cars24’s exit from Indonesia Here’s what happened: - Cars24, an India-based marketplace for used vehicles, [shut down]( its operations in Indonesia and Saudi Arabia. - Co-founder and CEO Vikram Chopra said Cars24 will be prioritizing its core markets, which are India, Australia, Thailand, and the United Arab Emirates. - Sources told Tech in Asia that the closure affected about 100 employees in Indonesia. Here’s our take: Cars24's venture in Indonesia was relatively short-lived. It [expanded]( to the country in March 2022, but its performance over a year of operations seems to have been unsatisfactory. Chopra said the company needed a “deeper focus,” which ultimately led them to withdraw from the Indonesian market. The company's financials in 2022 suggest that this may have been the right move. In its financial year 2022, Cars24 [recorded]( losses of US$248 million, up 9x from the previous year. Its expenditures even grew faster than its revenue during that period. The company had actually tried to reduce its expenses by laying off 600 employees in May 2022. But it seems that this wasn’t enough, especially since the company also embarked on an international expansion last year, setting up shop in Thailand and Saudi Arabia. Its foray into Indonesia was likely even more challenging due to stiff competition. In the archipelago, Cars24 had to go up against regional players like Carro, Carsome, and Carousell, as well as other players like OLX Autos, Moladin, Carmudi, and Mobil123. Indonesian conglomerates Astra International and Salim Group have also entered the used-car ecommerce space. The former [launched]( a platform called Mobbi in November 2022, while the latter introduced Goodcar through its subsidiary Indomobil in January. The potential size of the used-car market in Indonesia is indeed attractive. It was valued at US$50 billion in 2021 and is expected to reach US$70 billion by 2027, according to a [report]( from Research and Markets. However, the problem is that many Indonesians are not yet accustomed to buying cars completely online. Most still prefer to visit car dealerships to check and test drive the vehicles. That's why Carro and Carsome have integrated their online and offline services. Both have showrooms in several locations across the country that serve as experience centers that also allow consumers to go on test drives. The pressure on startups to focus more on profitability in the past year also had an impact on competition. Some players in the sector have prioritized efficiency and profitability. Moladin, for instance, [retrenched 360 workers]( in February, while Carsome [cut 10% of its staff]( across Southeast Asia in September 2022. OLX Autos also [reportedly]( slashed 1,500 jobs internationally earlier this year and is rumored to be selling its operations in Indonesia. This might indicate that growth in the online used-car market in Southeast Asia seems to be slowing down. Consequently, some companies were driven to go beyond providing marketplace services, such as providing consumers with loans to buy used cars on their platforms. Doing so can certainly increase sales for those players, especially since 70% of Indonesians buy cars on credit. Carro, Carsome, and Moladin are among those that offer financing services on their platforms. In these circumstances, it seems difficult for new pure-play marketplaces with limited capital to enter Indonesia. Cars24 is probably better off preseving its capital to fight elsewhere.  ---------------------------------------------------------------  NEWS YOU SHOULD KNOW Check out Tech in Asia’s coverage of the ecommerce scene [here](. 1️⃣ [Bukalapak, 500 Southeast Asia partner for early-stage investments]( Bukalapak president Teddy Oetomo said the partnership aims to back pre-seed, seed, and early-stage startups in Southeast Asia. 2️⃣ [Indonesian e-grocery firm Tumbasin to file for bankruptcy]( This comes after the company suffered from “insurmountable financial challenges,” CEO and co-founder Bayu Mahendra Saubig said. 3️⃣ [East Ventures leads Indonesian supply chain firm’s $20m round]( Praktis will use the investment to strengthen its services and ecosystem for direct-to-consumer brands and suppliers. 4️⃣ [Alibaba’s Cainiao eyes $2b raise in HK listing]( The IPO is part of the Chinese tech titan’s restructuring plan, which involves splitting its business into six units. 5️⃣ [EBay appoints new head for emerging markets]( Vidmay Naini will be responsible for leading the firm’s businesses in Southeast Asia, India, Eastern Europe, Israel, the Middle East, Africa, and Latin America. That’s it for this edition - we hope you liked it! Do also check out previous issues of the newsletter [here](. Not your cup of tea? You can unsubscribe from this newsletter by going to your “edit profile” page and choosing that option in our preference center. See you on May 11th! [ADVERTISE]( | [SUBSCRIBE]( | [HIRE]( | [FIND JOBS]( P.S. Don't miss out on the biggest tech news and analysis. Add newsletter@techinasia.com to your address book, contacts, or safe sender list. Or simply move us into your inbox. Too many emails? Switch to a different frequency or get new content through our [preference center]( or [unsubscribe](. You can also break our hearts and remove yourself from all Tech in Asia emails over [here](  Copyright © 2023 Tech in Asia, All rights reserved. 63 Robinson Road, Singapore 068894