Grab launched a shared kitchen in Vietnam on Tuesday to carter to the growing demand for food delivery.
It is in Thu Duc District, Saigon, and 12 restaurants make food exclusively for GrabFood drivers to pick up and deliver to customers.
Grab has given each of them space to cook for free though they have to pay utility bills, and gets a commission on the orders.
Vietnam is the second place where it has launched GrabKitchen after Indonesia, and there is great potential for this model in the country, Jerry Lim, CEO of Grab Vietnam, said in a statement.
Thu Duc was chosen because of its young demographic comprising students and workers who want to order from their favorite restaurants but which are located too far away, he said.
More such kitchens would be opened in the city this year and the model would be expanded to Hanoi and Da Nang next year, he said.
In recent years shared kitchens have become popular in Asian countries such as China, Japan and India as restaurants can focus completely on the food and do not need to find, rent and manage a shop.
Between January and June this year the number of GrabFood transactions quadrupled to an average of 300,000 orders a day.
Competitors for GrabFood in Vietnam now are Foody’s Now, Go-Viet’s GoFood and South Korean-owned Baemin.
Vietnam’s ride-hailing and food delivery market is expected to top $1 billion this year and $4 billion in 2025, according to a recent report by Google, Singaporean investment firm Temasek and U.S. consultancy Bain.