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‘Q-commerce holds immense promise with ongoing advancements in consumer behaviors and technology’

Taha Magrabi is the Director of Q-Commerce, foodpanda Pakistan. As the former CEO and MD of Utility Stores Corporation, Taha successfully led one of the largest ERP deployments in the public sector, covering over 5,000 retail stores and training 13,000 staff. Before Utility stores, Taha spent 17 years at Shell. In addition to his corporate endeavors, Taha actively promoted youth entrepreneurship as a Trustee on the Board of Shell Tameer from 2013 to 2021.

Following are the edited excerpts of a recent conversation BR Research had with Taha Magrabi:

BR Research: From an impressive tenure at Shell to leading Utility Stores Corporation and now at Foodpanda, how have your previous roles prepared you for the challenges and responsibilities as the Director of Q-Commerce at Foodpanda Pakistan?

Taha Magrabi: My 17 years at Shell, including roles in operations, franchise management, sales, marketing, pricing, and IT strategy, provided me with a comprehensive understanding of diverse functions and strategic planning. The robust systems and processes at Shell, particularly my involvement in ERP deployment, equipped me with the expertise to implement effective systems which were extremely helpful in my role at Utility Stores Corporation and now at Foodpanda, especially within Pandamart. My experience at Utility Stores Corporation helped me gain invaluable experience managing change and developing strategic partnerships. These roles have collectively prepared me to tackle the challenges and responsibilities of the Director of Q-commerce at Foodpanda.

BRR: Can you elaborate on the strategic decision-making process of Pandamart in Pakistan?

TM: The strategic decision-making process behind Pandamart is deeply rooted in a clear and well-defined framework. It begins with establishing a purpose that inspires and unites the organization. From this purpose, we develop a vision, which is then translated into a mission. This mission is broken down into strategic pillars, each supported by key focus areas, ensuring that every part of the organization is aligned and concentrating on what truly matters. My extensive experience in stakeholder management, particularly in senior roles, has greatly benefited my understanding of the stakeholders within Foodpanda. This comprehensive alignment from purpose to key focus areas ensures that our teams can prioritize effectively in their daily operations, making the decision-making process both efficient and strategic.

BRR: Given the competitive landscape, what makes Pandamart’s approach to the Pakistani market unique, and how does this reflect Foodpanda’s long-term goals in the region?

TM: Pandamart’s approach in Pakistan is unique due to our commitment to sustainable growth and community impact from the outset. Unlike other countries in the APAC region with intense competition, Pakistan presents a scenario where Foodpanda holds a leading position with a significant gap from its closest competitor. This advantage stems from Foodpanda’s early entry into the market, allowing it to establish deep relations not only with delivery riders but also with restaurants, food vendors, and other partners. These relationships serve as a strong competitive edge, especially considering the newer entrants lack the same level of market presence. This advantage has enabled Foodpanda to thrive, expanding into other sectors like grocery and shops.

BRR: With Pandamart operating in multiple cities and handling a vast range of SKUs, what logistical challenges do you face, and how do you manage efficiently across such a broad network?

TM: Operating Pandamart across multiple cities in Pakistan and managing a vast range of SKUs presents significant logistical challenges, particularly with the fill rate from suppliers. Unlike in more developed markets where suppliers consistently deliver products on time and in the right quantities, Pakistan faces variability within its supply ecosystem. This inconsistency leads to availability issues, disrupting the supply chain and negatively impacting store operations and customer experience when desired products are out of stock. To mitigate these challenges, foodpanda employs a multi-layered relationship matrix with its suppliers that facilitates better planning, coordination, and smooth execution. We at Foodpanda follow stringent standards for vendor selection and retention, focusing on reputation, customer feedback, consistent supply capabilities, and financial strength.

BRR: What criteria does Pandamart use to select and collaborate with vendors, and how do you ensure these partnerships align with your business values and customer expectations?

TM: At Pandamart, we adhere to strict criteria when selecting and collaborating with vendors, ensuring that our partnerships align with our core business values, Foodpanda strategy, and customer expectations. We partner with leading consumer products companies in various categories, guaranteeing top-quality products. We also support the local economy by collaborating with smaller enterprises aiming to expand within Pakistan, promoting sustainability and community engagement.

Foodpanda prioritizes quality and ethical standards, refusing to work with suppliers who have poor quality standards or compliance issues. This comprehensive approach ensures that only reliable suppliers are part of Pandamart’s network while enhancing overall operational efficiency and maintaining a positive customer experience despite the challenging supply chain environment.

BRR: What in your view have been the factors behind the collapse of other delivery services in recent times and how does Pandamart safeguard itself from these factors?

TM: The collapse of other delivery services in recent times can be attributed to a combination of factors, including operational challenges and market dynamics. Companies have survived and thrived by developing a robust and reliable delivery network, alongside building a highly recognizable and trusted brand that resonates with customers. By fostering strong market relationships and ensuring a sustainable business model, companies can effectively safeguard themselves from such challenges, allowing continued growth and expansion into new areas.

BRR: Considering economic fluctuations, how does Pakistan’s market environment currently support or hinder foreign and local investment, especially in the tech and e-commerce sectors?

TM: Any new product or service that entrepreneurs aim to launch must address a customer pain point or need effectively while being profitable. It is important to design a product, get customers to test it out, and ensure they are willing to pay for it. If your solution meets the need but is priced higher than the value customers associate with it, then it becomes a challenge. Thus, a clear understanding of customer needs and a robust product are foundational. Additionally, having a competent, skilled, and resilient team is crucial.

As you scale, you need to invest in building systems and processes that consistently deliver the same quality of product and experience to the customer in a cost-effective manner. Lastly, strong ethics and universally accepted values are important requirements as well. Without them, even the greatest ideas, best teams, and most sophisticated products or services will fail.

BRR: Based on your vast experience, what key pieces of advice would you give to upcoming entrepreneurs in Pakistan who are looking to navigate the complexities of the market?

TM: From my experience, entrepreneurs in Pakistan should focus on carving out niche markets with decent demand and higher gross margins to avoid red ocean markets that lead to price wars. It’s crucial from day one to understand your customer segments deeply; knowing who to serve and who not to is essential. Build strong business fundamentals and scale operations with SOPs and automation in mind. Funding should be seen as a milestone, not a destination, and always prioritize customer experience, using feedback constructively to refine your product or service.

BRR: With evolving consumer behaviors and technological advancements, what do you see as the future of Q-commerce in Pakistan? Are there any trends or technologies that you believe will be pivotal?

TM: The future of Q-commerce in Pakistan holds immense promise, with ongoing advancements in consumer behaviors and technology. As more players enter the market, success will hinge on continually enhancing customer experiences to generate brand loyalty. Technological advancements in-app features that enhance user convenience, such as algorithms for better product recommendations and features supporting repeat purchases, will play a pivotal role. Moreover, enabling strategic partnerships with telcos, banks, and fintech to provide multiple payment options that customers can choose from and partnerships with brick-and-mortar stores to enrich customer experience and optimize costs will be fundamental in boosting the growth of Q-commerce in the region.

BRR: How does Pandamart integrate corporate social responsibility within its business operations, and what initiatives have you led that aim to positively impact local communities and contribute to sustainable development?

TM: Pandamart prioritizes corporate social responsibility (CSR) as an integral part of its business strategy, aiming to make positive contributions to local communities and promote sustainable development. We actively support local economies by sourcing products from local farmers and suppliers, helping to build resilient food systems. To combat food waste, we employ predictive analytics to optimize stock levels and collaborate with local charities for the distribution of unsold consumables. Additionally, we have a strong commitment to reducing environmental impact and promoting sustainability at every level of operations - prioritizing initiatives such as using solar energy, adopting reusable bags for all our deliveries and quarterly carbon footprint measurement exercises, etc.

BRR: How do you implement diversity and inclusion within your teams and why do you believe this is crucial for fostering innovation and problem-solving in the Pakistani market?

TM: Diversity and inclusion are fundamental, not just for a particular industry or market, but universally across all sectors including sports, academia, and business. Diversity enables us to expand our horizons as individuals bring their unique views shaped by their experiences and biases. Different people interpret situations differently, and this variety of perspectives allows for a deeper, more intelligent understanding of problems and events. This is essential for challenging biases and preconceived notions, acting as a catalyst for growth. At Foodpanda, we actively encourage diversity within our teams by bringing together people from all walks of life, different genders, age groups, and experiences. This diversity allows us to challenge our norms and conventional thinking, making room for innovation and problem-solving. We encourage our teams to challenge an idea or a proposal with respect, irrespective of where it comes from.

We have regular town halls where participants are encouraged to speak their minds. We also recognize that some people like the comfort of anonymity. To enlist their ideas, opinions, and feelings, we use applications/tools that secure the identity of the person so that they are confident that whatever they say will be heard and considered. We are also making a conscious effort to promote diversity at more senior levels in the organization, challenging the role stereotypes. Diversity and inclusion are the top reasons for Foodpanda’s phenomenal success, as the businesses we have built have all challenged the status quo - in the case of Pandamart, we are making grocery and specialty shopping possible without a visit to the traditional brick-and-mortar store.

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