Food on the move: Delivery services get a tech-powered upgrade.
#Freshly made : Hello Fresh delivers recipe boxes wit hcarefully measured ingredients
for preparing meals at home. – Bloomberg
| Hello Fresh
RESTAURANTS have
delivered food to people’s homes for decades, but now the sector is being
disrupted by a raft of technology startups removing pain-points for consumers
and vendors. Investors believe the category will spawn a number of billion
dollar companies in Europe, described as “unicorns”.
“It’s driven by a convergence of
trends: convenience, increased penetration of smartphones, recession learned
frugal habits [as it’s often cheaper than eating out], the home becoming more
of a center for entertainment [again driven by the recession] and increased
availability,” explains Euromonitor’s head of Strategic, Economic and Consumer
Insight Sarah Boumphrey, who adds that apps have spurred growth in the sector.
One of the early pioneers was Danish
startup Just Eat, launched in 2001 and which debuted on the London Stock
Exchange 16 months ago. The web-based service offers menu aggregation and a
secure online ordering and payment system to restaurant so they don’t have to
invest in their own web systems. The model is echoed by other companies such as
Dutch-founded takeaway.com and Berlin based Delivery Hero.
“These companies are still gtowing
quickly because they have solve big headaches experienced by independent
restaurants,” explains Alsesandro Casartelli, vice president at tech-focused
investment bank GP Bullhound.
#Sending the food: With menu aggregators like just eat, restaurants still need to invest
in delivery infrastructure - tele pizza
- bloomberg|Xavier Mikel Laburu
Even so, once the orders are
processed through these companies, however, it’s back to the old model: The
restaurant still needs to hire someone to physically take the food to the
customer.
A new wave of companies are taking
this pain point away, integrating vertically into operations. “They are finally
able to manage the logistics more efficiently, whereas before it was just
ordering,” Casartelli says.
“Food is a trillion dollar market
that’s really hard for tech companies to penetrate, but software can solve some
of the logistical nightmare associated with handling products with a shelf live and getting them to the
right people quickly,” he adds.
Deliveroo, which last month raised
US$70 million in a funding round led by Index Ventures and Greenoaks Capital,
lets customers order from high-end restaurants that don’t have their own delivery
service, for a delivery fee of £2.5 (US$4).
Restaurants that use Delivero ca nsee sales rise as much as 30 percent,
according to Index Ventures.
The critical innovations is on Deliveroo’s mapping
capabilities which, much like Uber’s, allow the company to plan and predict how
to pick up and drop off food in the most efficient way.
Having already cracked this challenge, taxi app
services are also dabbling with delivery. Get Taxi promises to deliver bottles
of champagne within 10 minutes to Londoners for£50. Meanwhile Uber is trialing
a food-delivery service – UberEats – in Barcelona, Los Angeles, Chicago and New
York.
An alternative business model is offered by companies
like Hello Fresh and Gousto in Europe and Blue Apron and Plated in North
America. These sit somewhere between the incumbent grocery delivery services
like the UK’s Ocado and Tesco Driver and ateh aforementioned takeway delivery
players.
They deliver boxes with precise amounts of fresh
ingredients and recipes showing customers how to cook gourmet meals at home.
#First wave: Just Eat formed part of the first wave of tech
companies in the food delivery space.
“These recipe box companies enable people who might
not be into cooking normally to create relatively sophisticated meals with
comparative ease and without having to spend lots of money on ingredients they
might not use again. It’s a way of enabling consumers to dip their toe in the
water,” explains Bouhemphrey.
Unlike the takeaway delivery services, Hello Fresh
controls the customer experience from end to end. “We are an operations and
supply chain company. We procure a massive amount of ingredients, control the
supply chain ,the boxes, the delivery [..] we need to be very good at it as we
deal with perishable goods,” explains founder and CEO Dominik Richter.
Richter says the company has grown around 400 percent
over the last three years and toward the end of Q1 was delivering 4 million
meals per month – to customers in the United Kingdom, Netherlands, Austria,
Australia, Germany, Belgium and the United States.
“The interesting thing is these companies are three,
four, five years old as opposed to the takeaway marketplaces that are 10 years
old. The new one are raising capital much faster and growing much faster,” says
Casartelli. “The mature players have done a lot of education in the sector.”
Casartelli predicts there will only be room for one or
two big players in each market, so there’ll be a lot of consolidation down the
line. “It’s a competitive market: Customer will have one or two apps on their
phone, so power comes in having as much supply and demand as possible.”
Related posts :
Keywords : delivery,online,justeat.
Tags : delivery service,order your
takeaway online.
Description: A
wave of European food startup using technology to solve supply chain and
logistic headaches could become the next unicorns.
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