What is Grab's business model?

Can someone summarize how Grab makes money? I understand they have many different services like food and ride hailing. What else is there?

Del Casco

16 Jan, 2022

1 Answer

Wilson Twoon

Content Coordinator at Beamstart

Hey there, I would like to provide some insights from the brief research I did. 

In their revenue generation there are a few parts to it: 

  • Ridesharing: Depending on regions, Grab would extract a commission percentage of 16% to 25% of the total fare as one of their revenue sources while the rest of it would be distributed to the driver. 
  • Food and mart delivery: This revenue source can be split into two customers, both merchants, and delivery drivers. On average, the commission rate charged would range between 25% to 30%. They would also charge a platform fee as well. To summarize, Grab would keep 5% for every order facilitated. 
  • Advertising: Grab also offer an advertising service to SMEs. Their service could range from ads wrapped outside Grab vehicles, in-car branding, in-car retail where customers can sample retail products, and in-car tablets. 
  • Grab Express: This service would act as a courier delivery service where users can send whereas the price of the service would be dependant on the size of the package and the urgency of delivery. The determinants of how Grab charges would be a base fare plus a fee for every kilometer the courier travels additional fee for multiple-stop deliveries and return trips.
  • GrabInsure: Grab also offers an insurance service to their drivers which would include accident covers, income protection, and more. The policy rates would be dependant on the Grab-driver partner rating. 
  • Grabpay: Grab has also released their payment facilitation service which acts as a digital wallet. Merchants that choose Grabpay would be charged with a so-called Merchant Discount Rate (MDR) for every transaction processed. The Fee would vary between 1.2-2.9%.

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