Good and Bad of Platforms that Have Industrialized Meal Production and Delivery

Food marketers expect on-demand food delivery platforms to become more visible from headlines to investments as delivery dollars grow, here are basics to gear you up!

On-demand food delivery from restaurants is a big business that’s expected to grow to $76 billion by 2022. This represents a major source of potential revenue for businesses in a very competitive sector. Let alone on-demand food delivery, there are ghost kitchens that seek a large chunk of this market share. Later are similar to commissary space that hard-wired brick and mortar restaurants can rent to cook their delivery food, there can be several benefits that ghost kitchens can bring forth – there can be the ability to open delivery-only locations in neighborhoods outside their normal delivery zones and free up space at their primary locations, which usually aren’t designed for delivery production. They are the special kitchens that are set up to handle deliveries and are cropping up nationwide, attracting big investments.

Global On-Demand Food Delivery Heads for Caremongering

Food Delivery Major's like Swiggy and corresponding micro delivery platforms that sell milk and other essentials like eggs, bread, vegetables, fruits have rescheduled their delivery timings in wake of COVID-19, informed consumers that they will now deliver the products by 9 am due to high demand (it typically used to deliver by 7 am every morning).

Attention Grabbers: On-Demand Food Delivery Apps

Research is done on worldwide consumers recently suggests that restaurants from McDonald's to Buffalo Wild Wings are hot on delivery and have signed on with apps like Uber Eats, Domino’s, Just Eat, Deliveroo, Doordash, Eat24, Delivery.com, etc. This has resulted in a tripling up of restaurant deliveries in the past couple of years. This has also enhanced the millennials' food delivery market. Online food delivery statistics suggest that such apps are now amongst the top 40 most downloaded apps in the major markets.  

The emergence of Cloud Kitchens and Food Delivery Apps

Food Delivery platforms like Grubhub, Uber Eats, Doordash, and many such third-party delivery companies have partnered with ghost kitchens like CloudKitchens. Grubhub has recently acquired a competitor like Kitchen United and vertically integrates the businesses.

On-demand food delivery apps like Foodpanda, currently owned by ride-hailing giant Ola, recently pivoted to cloud kitchens. Similar food delivery service Swiggy claims it leads the cloud kitchens market in the country.

The power of on-demand food delivery platforms has been accentuated by Cloud Kitchens. These look at the location, comb through the data and know what kind of restaurants and food supplies would work there.

Food Delivery online platforms like Grubhub expand vertically with Kitchen United to control the platform from which consumers search and process food orders, the kitchens where the food is cooked, the delivery staff, and labor services that include cooks who can be automated.

What is good to know about on-demand food delivery platforms?

• It helps build a restaurant's brand without brick and mortar
• It facilitates local culinary deliveries
• Delivery-only brands like Zomato, Caviar, Doordash, etc. could take a bite out of sales at existing eateries thus providing competition and proving a potential nightmare for restaurants.
• Cloud kitchens reduce the risk for restaurants when they look for expansion.

What is not so good to know about online food delivery platforms?

• The delivery costs from technology to third-party commissions can eat into restaurant profits and wipe them out.
• Analyzing the costs of delivery, ordering platforms, brick-and-mortar rents, labor, food and beverage, promotions, technology, and customer loyalty programs can be very tricky for restaurants.

This can be eradicated by staying on top of your numbers and analyzing the situation carefully.

Types of Food Delivery Apps

Unpredictable working hours, chaotic life and hectic schedules make it impossible to cook a meal. This has caused the percentage of people ordering via on-demand food delivery apps in recent years.

It is important to know the types of food delivery apps in accordance to understand the way it works. There are aggregators, new delivery apps and full-stack food delivery services. 

1. Aggregators: Third-party applications that act as mediators between a consumer and restaurants. Consumers place an order via app or phone call and then it gets delivered via courier.
Pros:

• Customers get access to various restaurants
• It is a convenient option for customers.

Cons:

• These apps work on a fixed-margin basis which is normally compensated by the restaurant which is dealing with the order.

2. New Delivery Apps: Such applications let users compare the prices and offerings and menus of various restaurants but they dispatch the order themselves.
Pros:

• Such applications with logistic support provide restaurants with food packaging products if needed.

Cons:

• New delivery apps tax both a restaurant and a customer.

3. Full Stack Food Delivery Service: The food delivery service company is responsible to manage the customer interaction, cooking, and logistics.
Pros:

• The customers are informed about the picture of the dish, the list of ingredients and the name of the chef.

Cons:

• The order usually comes within an hour but it can be pre-ordered.
• The food comes cold but the customer is given heating instructions and serving guidance.

Concision

Online Food delivery is a $35 billion business and it is only expected to grow ten-fold over the upcoming decade. Going by the reports by Statista, on-demand food delivery apps are used at least once in a week by users in any corner of the globe. Few points must be considered if you wish to create an on-demand delivery app:

• Choosing the main features of on-demand food delivery app

• Key activities: Searching for appropriate restaurants, ordering food, delivery of the order
• Value proposition; Blazing fast delivery, no minimum order concept, existing customer base, a top-class algorithm, the global presence, better utilization of on-demand cabs/taxi's
• Customer Relationships: Promo code, user support, social media
• Customer Segments: Across demographics, High, middle and lower-income groups
• Cost Structure: Marketing, technology, Delivery workers salary, discounts for eats customers
• Revenue Streams: Standard delivery fee, recurring revenue share from restaurant partners
• Channels: Desktop, tablets, app store, support channels, social media

• Researching the target market
• Choosing the food delivery model
• Selecting the technology stack
• Selecting the payment gateway
• Push notifications
• Finding user location
• Determining the cost, budget and time constraints.

The last and most important thing is to hire a development team who is adept with the required skills to create an on-demand food delivery app and likewise.