In the on-demand economy, on-demand meal delivery firms are psychologically equivalent since they all promise to save customers time and effort when placing food orders and picking them up. There are several other food delivery app development business models that may be used; in this post, we'll discuss the two most popular ones along with their advantages.
Following Uber, a number of food companies—many of which are succeeding in the food industry—have entered the on-demand sector. They give their clientele the convenience they are entitled to. Additionally, their convenience study has produced a number of time and effort-saving ideas for its clientele. The worldwide meal delivery market is expanding as a result. Reports indicate that by 2026, the worldwide industry for online meal delivery is projected to earn $474.30 billion in sales.
Food companies have simplified and expedited the decision-making process. Before placing an order from the restaurant, you may first check the ratings and reviews on Zomato, UberEats, and other comparable meal delivery services.
In actuality, they expedited and simplified the payment procedure. For instance, consumers may pay using cards or other digital wallets such as Paytm or other wallets while using meal delivery applications like Ubereats.
In actuality, food businesses have also made repurchasing simple. To make it simple to place another order in a matter of minutes, you may, for example, bookmark your favourite meals or restaurants and store your address and payment information.
Additionally, the on-demand economy in the food business has changed many worldwide markets by eliminating the complete cycle approach and focusing on three essential steps in the ordering process. Place, Prepare, and Deliver.
Based on these three components, there are two effective business models that have been shown to be effective for meal delivery firms.
Top 2 Food Delivery App Business Models
1. The Order Only Model
Develop food delivery app like JustEat and Delivery Hero, are based on this idea, which is essentially a set of tools for ordering restaurants on your own. Attracting new clients via an integrated web and mobile channel is the primary point of sale in an online meal delivery business concept.
The Food Ordering Process
Under this concept, the ordering procedure for food operates as follows:
- First, customers place an order via the website or mobile app.
- Your order will then be picked up by the restaurant via the dashboard or app.
- Through an automated phone call or email, the restaurant will notify you that your order has been received.
Delivery Process
There are two possible outcomes for the delivery procedure.
- by the restaurant's employee who makes deliveries.
- by the delivery driver, who works for the corporation.
Limitations
Start-ups using this approach are restricted in what services they can provide on-demand, both in terms of cost and food. They are mostly linked to customers who order relatively low-key delivery meals like pizza, burgers, Chinese cuisine, etc. With this strategy, food entrepreneurs cannot optimise the quality and speed of food delivery services or manage them.
Benefits Of This Model
This concept eliminates the need for online food delivery services to worry about transporting or preparing food. These new businesses typically charge between 10% and 15% for meal delivery services. As a software-only business, they also offer amazing growth potential and enormous scaling opportunities.
2. The Order & Delivery Model
The first and third components—ordering and delivery—are the main emphasis of the new food delivery app development company software firms like Deliveroo, Doordash, and Caviar.
They carry requests and orders from customers to the businesses and take care of the distribution on their own. In terms of distribution, they often collaborate with a number of different courier service providers that are connected via an app similar to Uber in order to receive orders from customers and share delivery information with courier service providers.
The Food Ordering Process
Orders are placed using the app or website, where menus from various eateries are shown. When a restaurant gets an order through the food delivery app, it tells the delivery service the destination's location and the time to pick up the box.
In order to assist restaurants in covering the commission charge for the delivery service, they occasionally mark up the price of restaurant items. Customers also pay a predetermined flat cost for each restaurant they order from.
Delivery Process
The smartphone application that tracks their locations is accessed by the courier who is currently on duty. The courier decides whether or not to accept an order once it has been sent. The work is sent to other couriers if the initial courier declines it. The task will go to the first messenger to confirm the work.
Limitations
Businesses that purchase food online and have a second business model are typically software firms with a logistics division that handles a lot of labour-intensive tasks including hiring, onboarding, and preparing shifts for couriers.
So, in contrast to the pure-software business model, a food firm using this strategy finds it more challenging to grow.
Benefits Of This Model
The drawback of using this technique is that restaurants will often charge a fee that is 25–30 per cent more. But, you are able to provide both a range of costs and restaurant options that the meal delivery apps' exclusive business model is unable to. The Doordash business model is among the greatest illustrations of this type.
However, the Entrepreneur might have to work a little more to compete with the automated delivery and dining networks. Yet, after starting up again.
