What are the 5 factors affecting the on-demand food delivery service
Food delivery market is on the rise and it’s not a new business sector. Parcel food orders have been part of the restaurant since time immemorial, but this sudden rise in the no. of startups focused on on-demand food delivery indicates that a big force has come into play.
And that indication is towards internet coupled smartphones creating an environment of 24/7 connectivity.
The consumers have gotten very used to the concept to on demand, thanks to the 24/7 online concept. Food is the fundamental necessity of life, and it is, therefore, logical that it always is at a call or tap’s distance. That’s what on-demand food delivery caters too, a giant blue ocean of opportunity.
But before you dive into this vast, barely explored market with your on-demand service, keep in mind the following few factors
Pain Points of On-demand Food Industry
One cannot ignore the fact that on-demand food delivery space is fiercely competitive. There is a wide variety of existing services to choose from for consumers which include, Uber Eats, DoorDash, Seamless, and GrubHub.
The primary aim of on-demand food delivery service is to serve the consumer with rich taste, high-quality service, and the delivery of fresh food at customer’s door at the right time, and this is where the pain point of an on-demand food delivery service lies.
To provide accessibility as well as affordability in the middle of logistical challenges is what startups need to focus on when going on a food delivery venture. To be concise, focus on making your delivery service personalized for your consumers, in a manner similar to Uber Eats. The level of personalization offered by Uber Eats is the reason why it is ahead in the race. Parallelly you need to also focus on the pain points of your consumer as well, and even offer solutions which your rivals in the niche haven’t yet breached.
Should you keep an In-House Fleet or Outsource it?
No textbook approach or an instruction manual is detailing the correct method of taking on delivery operations of a restaurant chain.
Breaching new areas of the neighborhood, cities and if we are talking large scale, even countries are a very complicated task. You have to factor in individual country regulations, the infrastructure of the city, the consumer behavior as you expand your business’ horizons. In-house delivery troops give you control over the supply chain which includes the uniform they wear to every single penny they charge.
But it is easier and much more convenient for restaurant chains to partner with a delivery service possessing its fleet and save themselves the hassle of managing an additional department for a reasonable amount.
But therein lies a downside to it too, while that sort of trade-off doesn’t directly translate into the monetary loss, it’s more of an indirect risk. When a restaurant chain partners with an external food delivery service it non-deliberately competes with other food chains that are available with these third-party delivery chains.
The consumer loyalty in this scenario more likely lies with the delivery service brand rather than the restaurant chain, thus creating a potentially awkward situation wherein the opportunity for a restaurant to upsell customers lies with their ‘frienenmy’.
The gross cost of app development
Another factor you need to consider is the investment you will have to make
1) Design and Development: -Expenses on employees and engineers comprise of development, resources and application configuration. It is inclusive of all licensing costs and hiring costs for mobile app developers.
2) Developer’s expenses: -Expenses for developers are subject to factors like type of work whether it is on an hourly basis or monthly basis.
3) Cost of meetings and gatherings: -The expense for meetings conducted for discussion on work strategies isn’t insignificant mind you. It requires right amount to carry out.
4) Testing and launching: -The creation of app doesn’t end your task. It has to undergo trials and test runs to eliminate bugs and glitches which requires tools and different licensed software. The final launch requires a one-time distribution charge as well.
5) Promotion &Marketing: -Marketing today is indispensable and so is the expense associated with it. You have to let the people know about your app via promotions, social media, which incurs a right amount but is necessary to reach your targeted audience.
Technology is crucial to Food Delivery Orders
Start-ups can’t afford to go blind into a market simply because of their limited means. They need to have meticulously planned approach before entering the on-demand food delivery service. That means the staff employed has to be well trained, work in tandem with the drivers and making your consumers aware. To be one of the best in a niche such as on-demand food delivery service, you must possess the best food delivery app which comes with unique features and makes ordering food online a breeze, i.e., Technology is the key.
The Right Timing
You need to know for a fact that it is yet not too late to start in this industry.
Although most of the restaurant is aware of the necessity of expanding delivery offerings and capabilities, they are yet to figure it out completely themselves. Even though it might appear that the global big firms are way ahead of the curve, but the reality is starkly different. They too are still going through trial and error phase. And with the technology breaking new grounds every day, more and more avenues are opening up for exploration. So, not dismissing the fact that this time is the ripe time for tackling food delivery businesses it must also be remembered that this is still a nascent industry subject to grow in accordance with technological advancements
Building an online food delivery app is the most crucial step towards entering the on-demand food delivery service market with a bang.
And after considering the above factors, you get a reasonably decent idea what a restaurant food ordering app needs to comprise.
So, work on your app (Android or iOS) meticulously before you enter this market.
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