A report by the Economic Times shows that 2018 might be the year that the food delivery companies will look for a top spot in the market. The report predicts a battle between the five leading companies – Swiggy, Zomato, Ola-Foodpanda, UberEats and Google Areo. The year 2014-15 might have been the year of discounting which will continue now too but now owing to commission cuts, making a delivery platform the preferred one for various restaurants.
The Food Delivery War
“Discounting wars are likely to return, given the increase in competition but one may not see tm coming back immediately. However, there may be a tendency to get more restaurants on board through cuts in commission charges and that could probably swing the balance,” said a senior executive at a cloud kitchen firm while talking to the Economic Times.
The report also says that the industry had seen the worst investment dip in 2016 and somehow survived 2017 with 8% growth in investments according to the data by Tracxn. Two-thirds of this capital was what was raised by Swiggy. Foodpanda also saw a rise in revenue at the close of the financial year 2016-17. Investors saw that this year was more of clean-up of the investment dip with a significant growth in revenues.
“The discounts that platforms were offering last year to acquire and keep customers as also initiate more repeat buyers have now been passed on to the restaurants to sponsor,” said Samir Kuckreja, former head of Zomato Base and CEO at consultancy firm Tasanaya Hospitality while talking to the publication.