A breath of fresh air

Going local: BilaBila Mart was co-founded by Tan (left) and Lee who banded together because of their love of all things Malaysian.

AT a glance, BilaBila Mart seems to encapsulate the run-of-the-mill convenience store concept we are familiar with. However, a jaunt to its stores speaks otherwise, as it is essentially a modern kedai runcit that champions homegrown brands.

BilaBila Mart was co-founded by three friends who banded together because of their love of all things Malaysian.

The trio were eager to establish a platform to help local names, especially small businesses, gain a larger audience in the domestic food entrepreneurial scene, much like what Family Mart does for Japanese products.

BilaBila Mart co-founder Lee Hui Jing tells StarBizWeek, “If we look at the local convenience store market, the offerings are actually quite homogeneous, and then there are foreign brands like Family Mart that glorify Japanese items. Hence, we thought of creating a truly Malaysian convenience store that is filled with local goodies.”

BilaBila Mart co-founder Lee Hui Jing BilaBila Mart co-founder Lee Hui Jing

Lee added that product listing fee was a major conundrum for local brands and it is a big obstacle for their brand visibility.

“We make the barriers of entry low for small local players like Misusim, Truly Gourmet, Mun Tai Tai etc, by eliminating the listing fee. Only big players at our stores will be charged the listing fee.

“The listing fee per item starts from RM50 for most retail chains. As such, these small businesses would need to fork out a huge sum of money even before they begin their operations,” she says.

From cold brews to kombucha, artisanal chips to low-calorie ice cream, shishamo to sausages, and even fresh fruits and vegetables, one can easily whip up all three meals by visiting BilaBila Mart. In terms of variety, BilaBila Mart outdo its peers with over 2000 stock keeping units (SKUs)

“The products that we agree to list on our shelves need to meet certain criteria. Not only must the packaging look nice, the item also needs to have a barcode and a nutrition facts label.

“Having hygiene certification like HACCP is a plus point.

“There is an ongoing perception that locally-made products have a shabby appearance. However, there are actually a lot of good items that were not able to be on the shelves due to the listing fee,” says Lee.

By the end of 2022, BilaBila Mart had a total of 26 stores, all of which are located in the Klang Valley, targeted at residential areas where communities are.

The ratio of local to foreign products in BilaBila Mart is 70:30. Lee also shares that there are specially curated products that match the demographics surrounding a particular store.

“If our store is located in a Malay-dominated area, we will not carry non-halal products. Our outlet in Management and Science University does not offer sin products like alcohol and tobacco.

“Moreover, customers in an Airbnb area will find more ready-to-eat items that they can grab and go, while we keep fresh and frozen products at a minimum,” says Lee.

BilaBila Mart executive director Justin Tan Hai LiangBilaBila Mart executive director Justin Tan Hai Liang

In terms of store expansion, BilaBila Mart executive director Justin Tan Hai Liang says the team learns from experience.

“The opening of the first 10 outlets was quite difficult for us. We have to really prove to the landlords that we can perform and bring value to the community.

“There were locations that we have secured during our planning stages but decided to pull out at the end, resulting in hefty fines and penalties. We learned from our mistakes and with more than 20 stores, things are becoming easier now,” he says.

Tan adds that BilaBila Mart is fortunate to have the backing of Exsim Group, a property developer, as an investor in the business. The business relationship started when Lee approached Exsim for an outlet opening in one of its condominium projects.

“It is our sole partner in the business. Exsim Group owns 49% of BilaBila Mart, while the rest belongs to the three of us. One of our growth strategies is to expand alongside Exsim. We add value to its properties as we believe our presence helps the group to fetch better valuations for its developments,” he says.

Talk about unfortunate timing, BilaBila Mart opened two days before the Covid-19 pandemic. Due to the movement control order, Lee had to quickly adapt to market demand by selling masks, sanitisers and Dettol-related products via social media platforms. “At that time, we were not listed on any delivery platforms so I depended a lot on social media to source for customers. Fortunately, with the correct use of hashtags and boosted posts on Instagram, one of my posts gained traction and I began to ship the items to buyers, even as far as Sabah and Sarawak,” says Lee.

Offerings like fresh produce, frozen products, cooking condiments were only added later on, as the business traversed through the pandemic, due to a rise in demand for those items.

“People were afraid to go to the supermarket during the pandemic years and they asked us for things like fresh produce etc.

“That was when we realised that we needed to start carrying those products at our stores. It is important to adapt to changes in the environment or else it will be hard for a business to survive,” says Lee.

The team has plans to open two stores per month in 2023, and will eventually expand its operations in Penang by 2024.

“By looking at our run rate, our ultimate goal to hit 100 stores by 2025 is achievable. Repeat buying in our stores is high, at 30% amongst our customers. The footfall rate is quite stable now compared with the pandemic, with almost 70% to 80% of customers being regulars,” say Tan.

An initial public offering (IPO) exercise is also in sight for BilaBila Mart after venturing to the north in 2025.

“In gearing up for an IPO, it will take up about one and a half to two years of planning, so we will initiate the necessary preparations by the end of this year,” says Tan.

BilaBila Mart flagship stores like the one in Empire City, have photogenic interiors, and a larger space for better customer experience. It also has general stores, for instance its outlet at Ryan & Miho in Petaling Jaya.

“General stores have a smaller outfit with lesser SKUs compared with flagship stores that have a full range of products. For general stores we cannot allocate that much capital expenditure (capex) as what we would in our flagship outlets, but we will still try to make it as aesthetic as possible. The capex for each store can range from RM150,000 to RM600,000,” quips Tan.

Ultimately, Tan adds that as the business grows, they intend to participate in the success of those local brands by investing in their growth. This move can also allow BilaBila Mart to have more exclusivity and control over how the brands carry out their distribution. “We are looking to punch above our peers by at least 30% to 40% in terms of average revenue per store. It is not difficult to achieve this as our average basket size is higher.

“We observe that a number of convenience store players are pivoting to be food players because of higher margins and will start to compete with quick service restaurant products out there.

“However, for us we will try to perfect our model on the retail side of things. We want to be a convenience grocer rather than a convenience fast food store player,” he says.

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