Singapore-Speaking of 10 years old, the online supermarket RedMart is learning from the books of 5th and 6th children at that age-a major test lies ahead.

On November 3, 2021, Lazada Chief Retail Officer Richard Ruddy in the RedMart warehouse at 47 Jalan Buroh.

Singapore-Speaking of 10 years old, the online supermarket RedMart is learning from the books of 5th and 6th children at that age-a major test lies ahead.

RedMart was established on November 1, 2011. After the online marketplace supported by Alibaba acquired Lazada in 2016, half of its business life cycle is owned by Lazada.

The pandemic of the past two years has lifted the fortunes of all online retailers, especially supermarkets like RedMart. But Richard Ruddy, Lazada's chief retail officer and head of grocery store, looks to the future, where troubles are already brewing.

In an interview with TODAY, Mr. Ruddy said that during the pandemic, revenue from online groceries grew between 70% and 80% year-on-year, doubling the 30% year-on-year growth that had been significant before the pandemic.

As the global coronavirus situation approaches a new normal, the head of RedMart predicts that its growth will eventually slow down, but is expected to serve a quarter of Singapore's grocery industry in the next few years.

"But I wouldn't say that we make hay when the sun is shining," he said.

"We know this is a painful period. Everything we do is customer-centric, with the right product range and quality, and more importantly, to provide the right service and delivery."

In 2019, just before the pandemic, its standalone app was merged into Lazada's own app, leading people to question whether the online grocery brand could retain its identity and form.

Facts have proved that this has not stopped customers from returning to RedMart to purchase necessities and household goods.

The situation of working from home, and the mixed work system that Mr. Ruddy believes will continue, means that more people are aware of the convenience of buying groceries online.

Traditionally, the concept of the grocery business is to provide good promotions so that people think they get a good deal. He added that as working from home becomes commonplace, people also learn that they don't have to go to the store to get the deal and can save time on online purchases.

Mr. Ruddy said: "People want to make time for themselves... instead of going to the store to pick up the goods for an hour and a half. When the virus may be everywhere, waiting in line is also a hygienic point of view."

According to data from the Ministry of Statistics, as of September this year, 15% of all sales in supermarkets and hypermarkets occurred online.

This has doubled from before the circuit breaker period, when the online sales ratio was 7.5% in March 2020.

Official statistics show that in September 2021, online sales of computer and telecommunications equipment (53.7%) and furniture and household equipment (32%) were even higher.

However, the pandemic has exposed the fragility of the supply chain, which may threaten online companies engaged in importing and exporting commodities.

The global supply chain dilemma was triggered by pre-pandemic trade tensions and then accelerated by the blockade of a large number of countries caused by Covid-19, which temporarily slowed or stopped the flow of raw materials and finished products.

Due to geopolitics, labor and equipment shortages in the global shipping and logistics industry, and the growing energy crisis, supply chains continue to receive attention.

This affects the industry, especially the electronics and manufacturing industries, at a time when demand may decline with the recovery of advanced economies.

All of this casts a shadow over e-commerce and online retailers, many of which rely on smooth sailing and following the ocean of global logistics. Customers may also feel pressure due to rising commodity prices.

REDMART lessons learned from the pandemic

The shock wave of the pandemic is the reason why RedMart cannot sit still on its 10th birthday. It recently completed the 353,000-square-foot West Fulfillment Centre, which has an automatic storage and retrieval system that can automatically classify, store, and retrieve more than 48,000 products to fulfill customer orders.

The larger warehouse space is more than double the 81,000 square feet of space previously located on Yugang Road.

There are more than 120,000 products on the RedMart platform, 25% of which are fresh and frozen products. It has expanded its international product range to include products from Woolworths in Australia, Sainsburys in the UK and Lotte Mart in South Korea, as well as "special import" products from Japan and Taiwan.

In order to prevent problems in the supply chain, RedMart has increased its own brand product range from three products six years ago to more than 400 products.

More than half are produced in collaboration with local partners and suppliers, including brands such as local restaurant Fishball Story and vegetable farm Sustenir.

In the past year, the number of customers buying private label products has doubled, and when they buy on RedMart, more than half of the customers will end up buying these private label products.

When asked how RedMart decides which product to purchase for its own brand, Mr. Ruddy said: “If we see customers searching for a specific thing on the app, but they can’t find what they want...then we Can understand the gap within our scope."

Like many others, RedMart has experienced considerable stock volatility during the pandemic, such as panic purchases by Singaporeans during the circuit breaker and subsequent small lockdown.

“We sold an amazing amount of eggs, cooking oil, rice and noodles. Initially, I thought we sold more than 500,000 eggs from one month to the next. Did people eat more than 500,000 eggs? Not true. Yes, but that was the survival instinct that was happening at the time," Mr. Ruddy said.

He added that, on the bright side, customers are also looking for "niche, handmade alternatives" to buy because familiar brands are sold out.

This means that buyers will find a wider variety of products, including international products from countries they might want to visit but cannot visit due to travel restrictions.

People are also buying more fresh products online, which is contrary to the idea that fresh meat, fish and vegetables should come from local wet markets or physical supermarkets.

"Our customer base for fresh food is nearly 30% higher than before (the pandemic). I think this is a recognition of everything we do as a retailer... it really is a sudden overnight change for us ."

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