It is now estimated the total spend on delivered food or “eating out in home” is worth more than $6B in Australia and growing at a double digit rate every year.
The initial concept of delivering food has also spawned new ideas including companies like “Food by Us” to take advantage of time poor parents who prefer to order cooked food from a local chef when it suits them.
Who are the winners in all of this? The consumer of course, and maybe some businesses but even that’s debatable. Everything is now about choice, convenience and cost. One of the first companies to offer delivery was British company Deliveroo, then came Foodora and in 2016 UberEats. Deliveroo and Foodora rely on freelance bicycle delivery riders in the inner suburbs of major cities, whereas Uber Eats uses its existing drivers to deliver food into both inner and outer suburbs.
What started out as an offering of food from higher end restaurants it now encompasses everything from desserts, ice cream and other mainstream brands like Grill’d, Guzman & Gomez, and major players like McDonalds, KFC & Red Rooster.
The demographic profile of customer using these services are males 24-34 and is growing. For food companies contemplating jumping on the band wagon, be warned that delivery could cost you as much as 35% on every order. It could very well be a case of fear of missing out, and we simply have to offer it because our competitors do. On the positive side, most companies surveyed have said they have seen an increase in sales some by double digit growth with a large percentage of new customers who may never have tried the brand if not for this service.
Deliveroo has even taken the concept one step further, introducing “Deliveroo Editions”, a delivery only kitchen concept, in a bid to help restaurants reach new customers and develop innovative food concepts. These so called “Ghost kitchen” are now popping up in major cities with more and more food brands signing up as they see the benefits of having their food prepared in convenient kitchens dotted around the inner city by local chefs.