Convenient Food Delivery Services Expand Around the World
T
he food delivery industry is growing at a rapid pace all over the world due to the convenience, variety and relatively low cost of service.
Over the past 5-7 years, several major companies have grown exponentially, continuing to expand the previously limited food delivery service to thousands of restaurants and millions of customers. In particular, cities and urban centers have become the epicenter of this evolution.
One of the major factors driving the market growth is the rising penetration of smartphones and internet connection, which makes the food delivered service very easily accessible. And yet despite the rampant growth in recent years, the industry remains young and certain significant issues remain to be solved; the competition for low pricing which hurts the bottom line, the struggle for timely delivery and the lack of service in more rural areas are all major issues.
In response, companies are emphasizing on enhancing logistic capabilities and consumer experiences. Now, numerous companies are adopting enhanced delivery methods, which can considerably speed up delivery and reduce operational costs, like using robots or drones. For example, according to an article by Forbes, students at George Mason University and Northern Arizona University have been getting food delivered by robots since the beginning of 2019.
Later in the year, the company behind those robots, Starship Technologies, announced that it had raised USD 40 Million, led by Morpheus Ventures, to expand its service to 100 college campuses. Overall, the global revenue from online food delivery will reach USD 200 Billion by 2025 and with a CAGR of 14%, according to a research by Frost & Sullivan. China Xiangtai Food Co., Ltd. (NASDAQ PLIN), Grubhub Inc. (NYSE GRUB), Uber Technologies, Inc. (NYSE UBER), Yum China Holdings, Inc. (NYSE YUMC), Alibaba Group Holding Limited (NYSE BABA)
By region, North America is home to more 10 online food delivery companies, with Grubhub leading the way as the most valuable one, accounting for over a one third of the total market share, according to Forbes. Europe also has more than 10 food delivery companies, with Dutch company Just Eat serving eight countries in the region, and controlling over 83% share of the total U.K. market share.
In the meantime, in terms of number or orders and deliveries, the Asia-Pacific region is the absolute leader. This region accounts for a 55% share of the global online food delivery market share. Forbes also indicates that China alone registered over USD 34 Billion in online food delivery revenues in 2018, with two of its biggest players, Ele.me and Meituan Dianping recording about 10 billion deliveries between them back in 2018.
In addition, in a wake of the Coronavirus outbreak in China, local food delivery services are discovering that they can play an important role in helping the public dealing with a crisis. According to recent data published by analytics site Sensor Tower, grocery delivery and recipe apps have climbed to the top of the charts as people continue to mostly stay indoors in areas where the virus is prevalent. For instance, Fresh Hema, Alibaba's grocery delivery app peaked on February 8th, reaching nearly 100,000 downloads in a single day, compared to an average of approximately 29,000 per day during 2019.
✔️ Convenient Food Delivery Services Expand Around the World
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