FRUGL signs service agreement with Metcash, Australia’s leading wholesaler
Frugl Group Limited (ASX:FGL) today announced it has signed a Service Agreement with Metcash Trading Limited for focused retail data analytics services to be provided to Metcash Food.
These services will be generated through Frugl‘s leading price comparison technology platform.
Metcash is Australia’s leading wholesale distribution and marketing company with sales of over $13 billion in FY20 and supports well established retailer networks such as IGA, IGA Liquor, Cellarbrations, Foodland, Mitre 10, amongst many others.
Metcash delivers to more than 10,000 retail customers supported by distribution centres in each of the major cities, as well as smaller regional centres whilst also supplying around 90,000 wholesale customers from smaller branches across the country.
Terms of the Service Agreement
The Agreement directs Frugl to provide key data and analytical information to Metcash Food through the frugl and InFocus Analytics platforms to enable intelligence-lead retail decision making.
Under the terms of the Agreement, Metcash has engaged Frugl for an initial term of 2 years, with an additional 1 year extension option available to Metcash.
The fees payable to Frugl for the data and analytical information under the Agreement are not financially material.
Frugl will seek to develop its relationship with Metcash with a view to expanding the scope of the services Frugl will provide, in which case the Company would release a further market update.
Commenting on the Metcash Agreement, Frugl Managing Director Mr Sean Smith said; “The agreement between Frugl and such a significant market player in Metcash reflects not only the quality of our retail data asset, but the expertise and understanding of the retail industry that we possess to further unlock business value from it.”
“We are looking forward to working with Metcash on many retail intelligence projects across their business in the years ahead.”
FRUGL is a price comparison platform that in part allows families to compare the cost of goods between different supermarket retailers in their local areas, whilst analysing shopper behaviours in real time against the changing landscape of product merchandising and pricing changes across over 60,000 different products from major supermarket chains – Coles and Woolworths.
FGL has developed technologies that incorporate real-time data capture, cloud-based storage and advanced cloud-based data analytics.
Specifically, the group offers a retail intelligence ecosystem that acquires publicly available grocery data, organises it, enriches it, and utilises it to power two independent retail platforms: Frugl Groceries, a free grocery comparison and wellness mobile app for shoppers (B2C), and InFocus Analytics, an advanced retail analytics platform for retailers, suppliers and analysts (B2B).
Following our initial coverage on FRUGL and the release of the company’s Quarterly Report and Investor Presentation, FRUGL garnered significant investor attention. Its share price rose as high as 66% to $0.083 on 8 February 2020, and is currently sitting at $0.073 at previous close.
Such attention echoes the number of near and near and medium-term share price catalysts on the horizon for FGL in 2021.
The quarterly report in late January informed of an 11% increase in the number of users of the Grocery App following the release of Version 2.0. A major release is expected within the March quarter (Version 3.0) and this will include performance enhancements, as well as the addition of filtering and dietary features.
This is likely to be seen as an attraction that will foster further subscriber growth, making it a potential share price catalyst.
Additionally, commercial contracts for ongoing data services will begin in the first half of 2021, with the second half expected to see the expansion of commercial data and intelligence services that will include shopper behavioural data.
Commercial contracts for the InFocus Analytics SaaS product are commencing, followed by the inclusion of customer behaviour data into InFocus analytics for new and existing customers.