Highly popular food delivery startups entail the same psychological mirth in the highly on-demand business and economy. Every food delivery startup is focusing on economizing on time and money when it comes to ordering meals and delivering the needful.
However, post the resounding success of Uber in this market, numerous food companies have entered the bandwagon and are going great guns. They are providing a lot of convenience to their customers. Startups are also investing time and effort in researching other means of convenience to enhance customer experience.
- Food startups have taken a unanimous decision in this regard. For starters, just check the reviews and ratings on UberEats, Zomato, and other food delivery startups before you order food from the eatery.
- Every app is free. Every app has simplified and expediated the payment process. For instance, they allow users to make card payments or pay from their wallets. These include digital wallets and Paytm.
- These startups are also making re-purchasing/re-ordering very easy. For example, after ordering your restaurant food, you can always bookmark your cherished restaurants and favorite dishes.
- The app gives you the option of saving your address and payment details. It makes it extremely easy to reorder within a few seconds.
Additionally, the food industry’s current economy has impacted numerous international markets through a complete cycle strategy. It just involves three core properties of the food ordering process. These are order, cook, and just deliver.
Introducing the business models
Food startups focus on touch all customer touch-points to timely convenience. The five conveniences are decision, access, transaction, and benefit and post-benefit aspects.
- Fast and convenient decision-making makes it easy to choose your app through different ratings.
- Accessibility makes it easy and fast to acquire the food. For example, Hot Meals deliver the food to you at your place within 15 minutes via the Spoon Rocket. You can easily eat well whenever and wherever you’re hungry.
- Transaction scope makes payment fast and easy. You can pay with cards, wallets, and PayPal accounts. Apple Pay is a popular wallet. Some countries also allow the cash-on-delivery option.
- The benefit component makes it easy and fast to enjoy or use a product. Platforms like Postmates enable a customer to seek delivery from multiple restaurants. They deliver the food straight to your location.
- With the post-benefit resource, you can easily reorder your favorite food.
As a food delivery app, order allocation is very crucial, says Eric Dalius. The restaurant receives a customer’s order by fax or email. It immediately notifies it on the app.
Into the models
Essentially, there are three food delivery models in the market. What you need to know most online food delivery operations follow the marketplace business structure.
- The order only model is extremely popular with JustEast and Grubhub. There are food delivery startups that are coming up with innovative business plans.
- In the ambit of food delivery apps, your company, the online platform, acts as a buffer between the local restaurants and the users.
- You simply facilitate the eateries and users, connecting them with one another to place and deliver the food.
- The sole aim of this business model is to help restaurants and eateries reach out to the market and larger audience share.
- On the other hand, online food delivery apps help customers to order meals from their favorite restaurant.
- After receiving your order, the restaurant confirms the order and sends a message to the concerned customer. The platform confirms that your payment is successful and it shows on your app.
- In some cases, they directly print orders in the kitchen through a POS system.
You assign a restaurant delivery person or valet to deliver the food at the customer’s doorstep. If there’s any issues, customers can call the delivery partner on a mobile number.
The order and delivery model
This model simply takes the aforementioned only delivery model to its next level. If you want to comply with the order and delivery pathway, you need to encompass the logistics on behalf of the restaurants.
Since eateries have time constraints to invest in delivery service and food delivery firms can create ample revenue streams by propelling restaurants to bolster their delivery service, this model is ideal for both.
- Top food delivery service providers like DoorDash, Zomato, and Uber follow this very model. They allow anybody to become the delivery deliver with one registration.
- When a person orders the food, the platform notifies a nearby driver to pick up the food and deliver it. Food delivery firms pay these drivers on the basis of the distance they cover from completing a delivery.
- Contrary to the order only model, you need more resources for operating the order and delivery model, asserts Eric J Dalius.
- Your business needs to have a team of customer executives, drivers, restaurants, three separate apps for three crucial stakeholders.
- Nobody can deny that more resources help you generate more revenue. But you need to utilize the resources in the right way.
Note the challenges
Food delivery businesses are not devoid of obstacles. As a startup, you need to research the target market for deciding on the type of delivery services you’ll provide.
- You’ll find that the most successful and reputable food delivery apps target busy working professionals.
- Instacart is one such app that targets people seeking healthier meal options from premier grocery stores. Upscale choices gain prominence in this regard.
- These apps don’t deliver cooked food. However, some have recently launched a separate section, allowing you to cook meals from a good restaurant.
- Instacart Meals allow a user to choose any meal/dish. The app works on automation to find the right ingredients for your recipe.
- You can even customize the ingredients in accordance with your dietary. It leads us to a whole new segment nutritional apps that deserve a separate discussion.
Uber for delivery or Uber Eats strives to make tech-savvy folks or millennials cheerful. All startups and even running food delivery businesses need to partner with grocery stores and restaurants. A broad network of partner eateries gives your app a lot of fuel to get enough traction and market share.