By Sami Zaptia.
Tripoli, 14 December 2021:
Presto, Libya’s relatively new delivery company, has taken the country’s capital by storm. In a very short period, the company has achieved notable popularity amongst Tripoli’s population for its ability to satisfy the growing need for food and grocery delivery services with record-breaking success.
While such a concept is well established in the more advanced markets of the world, it took the Corona pandemic and its lockdowns to create the perfect gap for Presto’s establishment.
The company has two divisions; the PrestoEat division delivers takeaway food and drink from cafes and restaurants and the PrestoJet division delivers groceries. The company plans other Presto offshoots soon.
‘‘We regard ourselves in the quick commerce industry’’, explained Ammar Hmid, founder, and Chief Executive Officer, during an exclusive interview with Libya Herald at his Tripoli headquarters.
‘‘This is a new industry on the rise which contrasts to E-commerce. The difference is about real time, quick delivery. Our delivery time for groceries is about 20 minutes – except if there is a queue which provides an option for customers to join and wait.’’
The delivery company was initially founded on the 1st of June 2020 and spent the next four months establishing itself. In October 2020, it introduced its food delivery service ‘‘PrestoEat’’ to the Libyan market and was met with an overwhelming level of demand.
The company delivers to about a 20-odd kilometre radius in Tripoli – subject to drivers accepting delivery slots. Customers should be no more than two kilometres away from the logistic centre. It currently stocks around 3,000 products in its own warehouse and is planning to expand its range even more.
Ambitious expansion vision
The company has a very ambitious expansion vision. It plans to expand within its current sectors and to other sectors. ‘‘The growth strategy is to capitalise on what Presto has and transfer its business model to different cities and countries beyond Tripoli.’’, Hmid explained
The company has provided a larger variety of products on the Presto application, including over-the-counter pharmaceuticals, stationery, and electronic accessories.
Most drivers are freelancers
Most of the company’s delivery drivers (approximately 1,400), drive cars. These are freelancers and own their own vehicles, but there are about 100 full time drivers. ‘‘We aim for all our drivers to be freelancers. We see ourselves as enablers for quick commerce. We follow the asset light business model’’, said Hmid.
Only about 75 drivers drive motorbikes which are owned by the company and are in the corporate orange colours. They stand out in the crowded city and are a permanent advert for the company as they weave around traffic in the Presto livery.
Presto employs a significant number of female employees amongst many departments, but all drivers are male. ‘‘Driving does not attract females’’, he explained.
Most drivers who use cars are from the older age group, while the motorbike riders are from the younger population, usually students. However, there is still a shortage of drivers and good labour, he complained.
All Libyan investors
Hmid opted to remain vague about the number of investors in his company and their identities. ‘‘We have a handful of investors in the company, and they are all Libyans’’, he reassured.
‘‘Business is about people and creating value. We aim for perfection’’, he added. Giving a hint of his ambitions for the company, Hmid explained that ‘‘The concept of quick delivery and quick commerce has been evolving in the MENA region especially in Saudi and Egypt. Initially, of course, they started as start-ups but now they are worth billions’’, he noted.
Looking for new investors and venture capital
Hmid complained about the lack of development of the Libyan finance market and its unwillingness to take risk and inability to assess new companies still not in profit. He revealed that he had already spoken to some of the biggest Libyan business leaders and banks about investment. Presto ‘‘eats up a lot of money’’ he admitted, revealing that his company has already spent LD 20 million. He said they were looking for new investors and more capital to continue growth into other cities and regions.
‘‘It’s about fast growth not profitability’’ he explained.
Hmid considers Presto to be in the top ten in Africa in terms of instant grocery delivery services. ‘‘We have done well when compared to neighbouring countries, for example Egypt, and in groceries we are in a very good place regionally’’.
‘‘The market is thirsty and there to be exploited. We like to enter a sector with strength’’ he said, justifying his need for more capital investment.
Restaurant delivery expansion in 2022
Hmid said the plan is to expand the restaurant delivery business to Misrata, Benghazi, Beida, Shahat, Zawia and Zliten in 2022. He revealed that the cost of expansion for restaurant delivery is not that high. ‘‘We basically copy and paste our existing experience.’’
With regards to grocery delivery, Hmid said that as of next year, the plan is to expand to Benghazi first, as this branch of Presto needs a lot of assets and investment.
‘‘We’re looking for international venture capital, but we also need know how too – not just money’’, he explained.
When discussing how much capital he is looking for, Hmid revealed that Presto has 215,000 users, 60 percent of which are women, and that he values the company at around LD 75 million. ‘‘This is a conservative valuation. We are the market leaders. We have no competition in quick commerce. We need to make sure that the customer experience is good. For this, you need to burn money first. There’s a huge logistical operation behind Presto. The value of our company is perfection.’’, he expressed.
Overwhelmed by initial demand
Hmid revealed that the company had to go through a steep learning curve at its launch. For example, he explained that on its first day of operation, it received 300 orders for restaurant deliveries. This was followed by 400 orders on the second day and 500 orders on the third day, and a gradual increase since then until today.
‘‘We were stunned by our immediate success’’, he said. He described that the orders kept shooting upwards to the extent that the system got technically overwhelmed. ‘‘We learned a lot and evolved very quickly from the experience’’, he said. ‘‘We started with one hub and now we have 50 logistical hubs, and we now employ around 200 people.’’
The name Presto and colour orange
Asked about the choice of a foreign name rather than an Arabic name for the company (Presto), he clarified that it describes their business perfectly. It’s about delivering quickly and about being in ‘‘quick commerce’’. ‘‘We do not limit ourselves to Libya or the Arab market. We look to expand beyond Libya and MENA.’’ He said Libyans have a positive connotation of Italy and the Italian language. He said the colour orange is energetic, stands out and provides safety for the motorbike riders by being easily spotted even in the dark.
Got a break
While Corona was not the inspiration for Presto, it did play a catalytic part in the company’s development. Hmid admitted that the company got a break during the coronavirus lockdown in Tripoli as the Ministry of Interior gave it special permission to continue delivering to customers.
‘‘We had too much demand. Restaurants were unable to cope and there was a shortage of drivers’’, he explained.
Presto takes its Corporate Social Responsibility seriously, especially now that it has developed and demand has grown. For example, this November it started to recycle bags in response to the 40 percent increase in grocery orders per month. This boom led the company to order over 100,000 plastic bags. The CEO stated ‘‘we realised that we will need to order millions of bags. We have now started a scheme where we return 2% to customers on money spent with 20 pence refunded on returned plastic bags by drivers. This can be paid cash or deposited into the customers’ e-wallets.”