Food delivery is a concept that has become more of a habit than a need. Even if we are a few meters away from a good restaurant, we prefer to order the food online and have it at our place. Food Delivery apps like UberEats, Deliveroo, GrubHub, Doordash, and Postmates got an opportunity due to COVID and now have managed to be a part of the routine for millions of people.
Convenience and food are the things that people crave, and food delivery apps have merged them both to become the user choice. Due to the same, a Food delivery app development has been transformed into a great idea to transfigure the existing food business as well as start a new income stream.
In this article, we will talk all about the boom of food delivery apps, how well the segment is performing, what should a good food delivery app consist of, how much it will cost to develop a similar app and how it is going to bring back the investment.
What Are Food Delivery Apps?
Food delivery apps are mobile applications that allow people to use their smartphones or other devices to order food online from local restaurants. Once they’ve selected, the food is delivered right to their doorstep! This means you don’t have to go to a restaurant to get your desired food physically.
These apps make ordering food easy and convenient. They usually have menus from many different restaurants, so you can browse a wide range of options before placing an order. You can also pay for your food through the app, which makes the whole process even more seamless.
One of the best things about food delivery apps is that you can track your order in real time, so you know exactly when your food will arrive. These apps often have other features, like user reviews and ratings, special deals and discounts, and the ability to save your favorite orders or restaurants for future use.
Food delivery apps have become more prevalent in recent years, especially with the rise of on-demand services. They’re an excellent way for restaurants to reach more customers and increase their revenue while providing a valuable service to busy people who need more time to eat.
Reason Behind Big Boom of Food Delivery Apps
Considering the busy schedule of people or their preference to sit in the comfort of their homes, everyone is now happy to have restaurant food at their doorsteps without getting up from their couch. Food delivery app has managed to deliver this preference of people very efficiently by bringing restaurant services to their palm.
A couple of years in the past, one had to get prepared and have a schedule to visit his/her favorite restaurant and taste the popular dish. The food delivery app, while keeping output the same, has made the process much more convenient. The same user can now just pick up the smartphone, order the same dish from the same restaurant and get it delivered at the door in no time. So, people prefer the food delivery app that makes their eating time more convenient by saving time and effort.
Why Invest in Food Delivery App – Market Size and Stats
Shedding more light on the significance of mobile food delivery apps, here are some statistics that can help you understand the unprecedented scope of investment in the development of food delivery apps.
- According to the current segment performance and demand for service, the worldwide food delivery market is expected to reach a valuation of $320 billion by 2029.
- As per the data for 2021, the biggest contributor in the segment is the market of China, with a revenue contribution of 27.4 billion.
- China is followed by the markets like the US, Europe, and the UK, with revenue contributions of $22.4 billion, $9.2 billion, and $6.7 billion, respectively.
- One of the biggest food delivery apps, i.e., Delivery Hero, has more than 115 million users worldwide. Another popular app Uber Eats has crossed a user base of 83 million in 2021.
Bottom-line: Online food delivery apps are quickly becoming one of the growing forces in the food industry.
Revenue Forecast for the Online Food Order Market Worldwide from 2017 to 2024
Types of Food Delivery Business Models
Before developing the food delivery app, you need to understand the basic food delivery start-up models dominating the market.
1. Order Only Business Model
These are primarily second-platform apps that serve as a link between customers and restaurants. These apps accept food orders from the customers and pass them on to the restaurants. However, they are not liable for delivering the order to the customers, which is entirely the restaurant’s responsibility. Due to the absence of logistics support, such apps are only suitable for big restaurants that can leverage their own delivery systems.
2. Order and Logistics/Delivery Support
In addition to the previous features, this model offers delivery services as well. It involves third-party delivery personnel who picks up food from the respective restaurants and deliver them to the customer’s doorstep. These types of food delivery apps hold better market potential as they are also suitable for small-scale restaurants that do not have their own delivery services. The app charges a small delivery fee from the customers and enables them real-time order tracking. Ex Uber Eats
To sum up, aggregator apps are no longer considered a viable venture. So, if you wish to plunge into the development of a popular food delivery app, you must focus on this model.
3. Fully Integrated Business Model: Orders + Cook + Delivery
This type of food delivery application is an extension of your restaurant business. They cook, they deliver and they generate orders too. It is suited to established restaurants that already have a delivery system in place. By launching their exclusive app for food delivery, these restaurant owners make it easy for their customers to order their favorite dishes. At the same time, they gain the opportunity to reach a wider customer base. Apps like Dominos and Pizza Hut fall under this category.
4. Restaurant Prepared Food Delivery
The apps operating in this segment deliver the complete meal solution. Different food delivery companies such as JustEat, FoodPanda, GrubHub, etc. have partnered with the restaurants to deliver the food to customers. Users can login to the app and place the order from any listed restaurant. The order will be forwarded to respective restaurants, will be cooked and the delivery partner will take it to the customer.
5. Meal Kits Delivery
The food delivery solutions in this model are dedicated to busy households which can’t spend a big portion of the day cooking food. The meal kit delivers the food with two options: heat & eat, and cook & eat. Users can opt for any of the options to get delivered their preferred choice in no time.
6. Grocery Delivery
Grocery delivery holds the biggest market share in the food delivery app sector. COVID pandemic caused a sudden spike in growth of grocery delivery service in 2020. The app owner has partnership with the local grocery stores around the market. As soon as the order is received on the app, it is forwarded to the respective grocery store and the app owner delivers the order to the user’s doorsteps.
7. Veggie Box Delivery
In 2022, more than 500 British vegetable box providers had a waiting list ranging from 160-6700 customers, to whom more than 3.5 million boxes of fresh vegetables were delivered. The market leader and popular brands in this category even had to introduce the queue feature due to increased demand for vegetable boxes.
8. Cloud kitchen model
This model involves restaurants operating outside a central kitchen or hub without a physical restaurant space. The kitchen prepares food through third-party delivery platforms or its delivery fleet.
How a Food Delivery Mobile App Works
A Food Delivery Mobile App Works in Three Stages:
1. Order placement
The very first step in the process is order placement. The user login to the app, surf through the dishes and restaurant to order the food of choice. Having found the desired food, the customer places the order by providing the necessary details like quantity, add-ons in cooking, or any specific requirement. The order is completed by providing the delivery address and completing the payment.
2. Order Received and Cooked
Once the user has completed the order, it is forwarded to the restaurant for cooking. Here, the meal is prepared and packed by the cook. All the considerations for food preparations are forwarded to the respective cook.
3. Food delivery
The parcel is handed over to the delivery partner when the food has been prepared and packed. The delivery guy takes the parcel to the doorsteps and confirms the delivery.
Technical Phases of a Food Delivery Mobile App Workflow
| Step | Description |
|---|---|
| 1. | User Interface: The food delivery app provides an easy-to-use interface to browse restaurants, view menus, and place orders. |
| 2. | Restaurant Database: The app relies on a database of restaurants and their menus stored on a server. The database is regularly updated to ensure accuracy and availability. |
| 3. | APIs: The app communicates with the server via APIs (Application Programming Interfaces) to retrieve information about the restaurant and menu items. APIs are used to handle the complex interactions between the app and the server. |
| 4. | Payment Gateway Integration: The app integrates with a payment gateway to process payments made by the user. The payment gateway ensures secure transactions and supports a wide range of payment options. |
| 5. | Restaurant Interface: The restaurant receives the order through its own interface, which may be a separate app or a web-based portal. The interface allows the restaurant to track orders, manage inventory, and communicate with the delivery partner. |
| 6. | Restaurant Interface: The restaurant receives the order through its own interface, which may be a separate app or a web-based portal. The interface allows the restaurant to track orders, manage inventory, and communicate with the delivery partner. |
| 7. | Delivery: The restaurant prepares the food and hands it over to a delivery partner or their own delivery staff, who deliver it to the user’s address. The app may use GPS to track the location of the delivery partner and estimate the delivery time. |
| 8. | Feedback: After delivery, the user may be prompted to provide feedback on their experience with the app, restaurant, and delivery. Feedback helps improve the quality of service and allows users to share their opinions. |
App Monetization Opportunities for food delivery app
There are several ways in which you can monetize your on-demand food delivery app. Some of the most popular ways are listed below:
1. Delivery Charges
A lot of restaurants do not offer delivery services. These restaurants are most likely to pay for the delivery charges in return for your food delivery services. This is a popular monetization strategy that has benefited many businesses.
Zomato launched its food delivery services in 2015. In a brief spell, food deliveries account for 30% of Zomato’s overall revenue, making it the second-biggest source of income for the organization.
2. Peak Pricing
This is another popular revenue source, wherein the app incriminates a surged price when the demand is too high. The food menu on the app gets limited and a peak price is charged when the customer places an order. UberEats is one food delivery app that largely relies on this form of revenue stream.
Recently, Swiggy is also experimenting with this new model, where an additional delivery charge of INR 20 is added to every order placed on festivals, holidays, and rainy days when there is less delivery staff available.
3. Commission
In this model, the food delivery app owner charges a specific amount of commission for every order placed through the app. This is a popular source of revenue for many companies as it helps in generating high income.
This type of revenue model is followed by Foodpanda. It charges a pre-decided commission from the restaurants for every order placed through its mobile app or website.
4. Advertisement
Advertisements are the best and fail-proof method of generating enormous sums of revenue. You can feature a few restaurants in the top section of the app or run a short video for them on the home screen for the target audience and for all this, you can charge a specific amount of money.
This is the greatest source of income for the popular Zomato. It generates as much as 62% of its revenue via advertisements.
Challenges Associated With Food Delivery App Development
Before plunging into the food delivery industry, you must acquaint yourself with the several challenges associated with the development of on-demand food delivery apps.
1. Major Shift in Customer Preference
There are currently tens if not hundred food delivery companies in the market, working hard for survival. In this race of being the best, the innovative market strategies and attractive pricing strategies are being deployed by the companies to bring the customers into the fence. Absolutely, it has led to the customer benefits but at the same time, the brand loyalty has compromised significantly. Customers don’t have a second thought before shifting to a second company for better offers.
2. Cut Through Competition
The competition in the food industry is getting fierce each day. So, anyone who is planning to develop a food delivery app might have to face a lot of competition in the domain.
To stand apart, you need to offer your customers something that other players don’t provide. This has to be in relation to the app’s UI/UX and its features.
Besides, you will have to focus on improved ways of attracting partner restaurants as well as offering lucrative deals and discounts to the customers.
3. Food Quality
The distance between the restaurant and user’s address can be long enough to slightly degrade the food quality. After-all, the fresh served food at a restaurant is always better than the food which covers kms before getting into your plates. So, it is a big challenge in the food delivery industry.
4. Fluctuating Market Prices
The market prices of the food are highly volatile due to the changing prices of the raw materials. So, the food delivery apps can not stick to a particular price of the dishes. Changing price highly affects the profitability of the platform.
5. An Interactive UI / UX Panel
This is where the need for a reputed mobile app development agency heightens. A good app will blend design and movement to ensure that UX remains constant and interactive throughout the app. A well-made design in tandem with easy ordering is what you need to draw customers.
6. Locating the Right Restaurants to Partner With
A good way to start is by focusing on the small-scale restaurants that are looking for a way to promote themselves. It is a good idea to concentrate on the quantity at the beginning rather than the big ones that are famous among millennials. Gradually, as your app gains momentum, you can focus on acquiring big names.
7. Deciding the Mvp Features While App Development
Another challenge associated with food delivery app development is deciding the MVP features that should be incorporated into the app. MVPs have a great impact on regulating the cost of development. Creating a Minimum Viable Product will help you test the waters before taking a full-fledged plunge into the domain. However, deciding on the right features to be integrated can be a trial.
Prominent Names in the Field of On-Demand Food Delivery Mobile Apps
Owing to the increasing popularity of metropolitan culture, on-demand food delivery apps have become mainstream. Currently, the food delivery industry is thickly populated by some prominent names that allow customers to order their favorite food anytime and anywhere. Some of the leading food delivery mobile apps that are leading the chart so far include:
Advancements in Food Delivery Landscape
With time, the food delivery business has introduced various advancements in the landscape. The craze started with technology is now transfiguring the services to the next level and delivering a seamless experience to the users. Some of the major advancements witnessed recently in the sector are-
| 1. Drone Delivery | The use of drones for the food and grocery delivery has lessened the time and human contact to the food significantly. After COVID pandemic, nobody prefers their food to be touched by strangers. Drone delivery has efficiently addressed the preference as the food is directly delivered to the customer from the restaurant without any physical contact to delivery humans. At the same time, drone delivery has played a significant role in eliminating the time consumption of traffic to deliver the food. |
| 2. Cloud Kitchen | Another step to minimize the delivery team and deliver the fresh food, cloud kitchen is the new concept entirely based on the concept of cloud kitchen. Instead of big restaurants with heavy infrastructure, small kitchens are being installed at the various locations by known brands. The order is forwarded to the cloud kitchen in a nearby area. The delivery partner collects the order from the same and then delivers it to the customer. |
| 3. Intercity Food Delivery | With technology, miles are becoming shorter and now you can have your favorite dish from another city on your dinner table with just a few clicks. Intercity food delivery concept has been catching pace as more people are getting familiar with it. With such a delivery model, companies are transferring the prepared food from one city to another, closing the distance between your dinner table and a famous restaurant of another city. |
Advanced Features to Develop Outstanding Food Delivery Mobile App
| Social Login & Signups | His feature allows the customers to quickly signup for your app using existing social media accounts. A simple, quick, and attractive sign-up page is an important tool for bagging customer loyalty. |
| Book for Others | This feature allows the app owners to book food for others, simply by inputting their location and making the payment in advance. |
| Custom Packages | This functionality allows users to create custom packages by placing special requests or mentioning precise instructions. |
| Order History | This feature allows the users to check out their previous orders and even repeat any of the recent orders to save on time. |
| Floating Window | As the customer books his order, a floating window appears on the screen that enhances the customer experience by providing real-time GPS tracking of their order on the mobile app. |
| Customer Review | This is a simple feature that allows the app users to leave reviews about the food, service, cleanliness, quality, etc. These reviews often prove to be immensely helpful for new users as they can understand the quality and service offered by different restaurants and make a decision accordingly. |
| Push Notification | This is a crucial feature of all on-demand food delivery apps. The functionality is often used to send users notifications to customers, delivery agents, and restaurants. For instance, the app can send notifications to customers informing them about happy hours or special discounts offered by a particular restaurant. Push notifications drive greater engagement. |
| Catering Request | As the name suggests, this feature enables the users to create a special kind of food platter to be served to their guests at home or at a party. The order can be placed in two ways, either by platter or by setting a specific amount of budget per person. Accordingly, hot and delish food is served to the customers. |
| Franchise Management | This feature is for the restaurants that can use it to effectively manage their franchises. |
| Real-time analytics | Real-time analytics provide the admin with all the operation data that offers insights into the business. The app generates real-time revenue reports, revenue projections, and much more, enabling the admin to monitor the performance of the app as well as the business. |
| Role-Based Dashboard | Having role-based dashboards is a great way to simplify things. This feature is useful to gauge the progress of each business area in depth. |
| Multiple Payments | This is a crucial feature of on-demand food delivery apps. By integrating multiple payment options into the app, you can enable the app users to make quick and hassle-free payments from their desired mode of payment. |
| Real-time GPS Tracking | This feature keeps the customers informed of their order’s status. For instance, they can check when their order is placed, being processed, and on its way. This is a great tool to keep the customers engaged. |
| In-App Navigation | Food delivery apps should be integrated with a GPS location identifier. This feature enables the users to track their delivery agents in real-time. Besides, the tracking screen also records and displays the tentative arrival time of their order. |
| Heat map Generation | This functionality helps in determining the busiest time of different restaurants, making the customers aware so they can book their order accordingly. Besides, this feature is also helpful for the delivery agents as they can accumulate near the restaurants that generate maximum orders at a specific time to avoid delays in delivery. |
| Loyalty Programs | A robust loyalty program encourages the customers to order from an online delivery service. Using this feature, special offers or discount vouchers can be awarded to the loyal customers of the app. The feature not only allows the restaurant owners to show the customers that their loyalty is valued but also helps to retain more customers in the longer run. |
| Marketing Tools (Discount, Coupon, Mail, Text, Call) | Marketing remains to be the most essential component for every business. By integration marketing tools into the food delivery app, restaurant owners can send special discounts, exclusive coupons, first-order rebates, etc. to the customers to lure them. Besides, you can keep them informed about special promotions via call, text or email. |
| CMS Integrations | Content Management System is a vital part of every mobile app. By integrating a CMS, the restaurants can manage the content that is available on the app. For instance, the restaurant owners can easily update information about their place, including the name of the restaurant, contact details, open hours, address, etc. They can make changes to the menu, prices of the food items, delivery charges, and even update and add photos. |
| CRM Integration | In order to maintain a steady relationship with customers, efficient Customer Relationship Management software is a great help including marketing and communication tools it offers. |
| In-App Calling | Once the order is booked, the customers can make free calls to their particular delivery agent to explain the location, etc. from within thmobile app itself. |
| In-App Chatting | In-app chats further help the customers and the delivery personnel to be at a common touchpoint. Additionally, the users can initiate a chat with the restaurant or the admin, in case of any issues regarding food customization, food delivery, etc. |
| Phone Number Masking | This feature facilitates seamless communication between the delivery personnel and the customers without giving out real phone numbers. |
| Mobile Wallet Integration | In today’s digitally-advanced era, all food delivery apps must offer different types of mobile wallet options, such as Google Pay, Apple Pay, Paytm, Venmo, etc. to offer to augment ease of payment to the customers. |
| ChatBot Integration | Having a chatbot has become quintessential for almost all websites. The food delivery app must be integrated with an AI-powered chatbot that has the potential to immensely streamline customer interactions. |
| Artificial Intelligence | Ai-driven features like Voice Search, Behavior Tracking, Visual Search, Recommendation offer user-friendly experience as well as personalization. |
| Gamification | Integrating small gaming tasks such as the daily spinning wheel, etc. in return for points or other rewards can help to keep the customers engaged. |
| Bill Splitting | This incredible feature makes bill splitting between many users quick and easy. Different users can use different modes of payment to pay their share of the food bill. |
A Perfect Techstack for Food Delivery App Development
| Push Notifications | Twilio, Push.io |
| SMS, Voice, and Phone Verification | Nexmo, Twilio |
| Payments | Braintree & PayPal, Stripe, EWallets |
| Database | MongoDB, HBase, Cassandra, Postgress |
| MailChimp Integration | |
| Cloud Environment | AWS, Google, Azure |
| Real-time Analytics | Hadoop, Spark, Apache Flink, Cisco, IBM |
| Map Navigation | Google Map |
Food Delivery App Developer Team Structure
To develop a feature-rich and flawless mobile app, Once need to deploy an experienced development team that is experienced in the industry domain. It is always better to hire a food delivery app development company because an app development agency has all the needed resources under one roof along with a sense of responsibility. Given below is the team structure you need to create a mobile app development team.
- Android App Developers
- iOS Mobile App Developer
- The Project Manager
- A good business analysis
- Front-end developers
- Back end developers
- Quality analysis professionals
Cost of Food Delivery Mobile App Development
The exact cost of developing a food delivery app idea depends upon a plethora of factors, such as type of app, type, and number of features and functionalities integrated, cost of labor, the technology used to develop mobile app.
Roughly, the cost of developing a basic food delivery app is somewhere around $10,000 to $18,000. However, a high-end app with leading functionality may cost you as high as $40,000.
One crucial factor that largely regulates the cost of app development is the cost of labor. The labor charges vary with different countries and regions.
For Instance,
- US/UK-based app developers charge somewhere between $70 to $250 per hour.
- For Eastern Europe-based food delivery app developers, the rates vary from $50 to $170 per hour.
But this hourly rate is highly affordable in India, where you can easily find seasoned mobile app developers working at $20 to $70 per hour.
Thus, in terms of labor charges, India/South Asia is undisputedly the most feasible option.
Moving on, the cost of food delivery app development also depends upon the type of mobile app development company you choose. A good agency will be able to provide you with a breakdown of the total cost estimate so you can study the viability of the project in-depth.
For instance, a basic food delivery app in India based on the Android platform will approximately cost you:
- Technical documentation: $1,000 to $1,500 / 40 hours
- UI/ UX designing: $1,500 to $3,000 / 50-60 hours
- Front-end and back-end development: $8,000 to $15,000 / 400 hours
- MVP testing: $2,000 to $4,500 / 75-80 hours
- Bug fixing: $1,000 to $3,000 / 40 hours
Another thing to be kept in mind is the platform of development. It costs less to develop an iOS app than it does to develop the one based on Android. It is imperative to closely study the market and conduct thorough research of the domain and industry. This research will help you develop a flourishing app within the best possible means.
Summing Up
The burgeoning demand for food delivery among customers has given rise to a lot of food delivery businesses. The segment has produced million and billion-dollar companies worldwide, employing thousands of employees and connecting millions of customers. The concept of delivering food to customers’ doorsteps has received appreciation as eating at home has become the preference of the customers rather than going out and having the meal in restaurants.
For the same reasons, having a food delivery app has emerged as a great business opportunity. If you are already in the food, travel and hospitality business, your own food delivery app can take your business to heights by connecting it to customers on online platforms. On the other hand, even if you have yet to start operating in the industry, a food delivery app can be your gateway to enter the segment.
The cost of developing an app like DoorDash varies depending on the features and complexity of the app. However, it typically ranges from $20,000 to $150,000.
Food delivery apps can be profitable if they are marketed effectively and have a large user base. The profitability depends on the business model, commission charges, and other factors.
Yes, food delivery apps can be customized to meet specific needs. Developers can add features like loyalty programs, custom menus, and branding elements to meet the client’s requirements.
The time required to develop a food delivery app depends on the scope and complexity of the project. However, creating an app from scratch usually takes 4 to 6 months.
Yes, a food delivery app can be compatible with iOS and Android devices. Developers can use cross-platform frameworks like React Native or Flutter to build an app that works on both platforms.
User data security is a top priority for app developers. They use encryption, secure protocols, and other measures to protect user data from unauthorized access and data breaches.
App developers provide support after launch to ensure the app runs smoothly and resolve any issues quickly. This includes bug fixing, app maintenance, and regular updates.
Payment options such as credit/debit cards, digital wallets, and online banking can be integrated into the app to facilitate easy payments.
Yes, the app can be integrated with existing POS systems to streamline ordering and payment.
Yes, developers can provide training on how to use the app to ensure that users can navigate the app quickly and enjoy a seamless ordering experience.
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