Potboy Groceries' new model for fast-moving consumer goods

Malaysia-based grocery company Potboy Groceries has a unique business model that genuinely prioritises the needs of its customers.

Although it initially took a huge effort to convince merchants to partner with the company, it has been able to rapidly build a truly engaged community of 22,000 buyers to underwrite its success.

Former investment banker Eddie Chew CPA, Potboy Groceries’ CEO and founder, started the business without any experience in the fast-moving consumer goods (FMCG) industry.

It took a long five months for sellers to come on board when it first opened.

“At first our operations team ran around to source products from supermarkets to sell through the site, but we had a great bunch of users thanks to the Facebook community we built, who would use products bought from the site and share about it with the community,” he explains.

Potboy was founded in 2016, and its 500-plus product owners include major brands such as Coca-Cola, Nestlé and Procter & Gamble.

Its business model is to provide the tools for its sellers to distribute and simultaneously market their products through its platform; the site is replete with special offers to entice consumers.

Brands are also able to access their sales data to help them measure the success of their marketing campaigns, and market and sell their products more efficiently.

This aspect of Potboy will be developed over time.

As an example, let’s say a consumer orders a bottle of shampoo from the site. Sellers will be able to access data about where the buyer is located, so the order can be sourced from the closest warehouse to help drive efficiencies.

“You can’t do that without data, but we need about three years of customer information to really drive this part of the business,” Chew says.

Potboy has expanded from being purely online into the offline space, with the exhibition market a key target.

For instance, it pioneered an online-to-offline groceries sale in Malaysia, in partnership with mobile payment platform FavePay. The purpose of the three-day event was to showcase offline retailing to online customers.

The online innovator is also starting to move from being purely consumer-focused into the restaurant and cafe market, and aims to be a one-stop-shop for groceries for customers in this segment.

Much more than the postman

Chew says Potboy’s approach to operations sets it apart.

“To secure really loyal customers, you need to own your warehouse and delivery operations and properly train your staff. We’re not like the postman, we want to be our consumers’ friend,” he explains.

Every delivery also comes with a small gift to enhance loyalty.

Chew plans to expand the business throughout Malaysia in 2020, and roll out services across South-East Asia from 2021.

He also wants to venture into new markets, such as the food services supplies sector, with an emphasis on helping businesses digitise buying.

New marketing initiatives to increase revenue and enhanced data applications are also on the cards.

With such a robust pipeline of new initiatives, the sky’s the limit for Chew and the Potboy crew.

Inspired by "Potboys"

Eddie Chew CPA suggests entrepreneurs align their business’s brand with its purpose. This was top of mind for Potboy Groceries.

In Malaysia, potboys are people who collect people’s glasses after they have finished with them at bars and taverns.

“Potboys do things people don’t appreciate – and it’s the same with groceries,” Chew says.

“Everyone needs them, but we really don’t appreciate them. This is something we understand in our business. We’re prepared to do things other people don’t want to do,” he says.

Potboys are also exposed to lots of information while cleaning up after groups of drinkers who are sharing stories. Chew’s business also shares this trait, given it is privy to swathes of data that are extremely valuable to its suppliers.

“In the future, this will really help our suppliers plan for their production and distribution,” he says.