Food Delivery Business Challenges: Getting food to deliver at your doorstep is a blessing we all are gratified for the technological progress that has evolved in this sector. It is trending when in recent times everyone is preferring to stay at home instead of dining out at restaurants. When we feel tired or just wanted to enjoy food while sitting at home in pajamas, in this scenario food delivery becomes the best thing since sliced bread. Introverts are much more happy than usual; they can avoid social interaction.
It is not a surprise for us that the food delivery industry has become the top growing business recently. No wonder good comes bad things as well, there are several challenges faced by businesses in the world of food delivery and online restaurants that range from simple to complex. Challenges require special attention to be ahead in the rivalry. As the online food delivery business is growing, it also brings difficulty in entry barricades for a new entrepreneur, and a menace of failure for the existing players.
The Growing Food Delivery Market Stats & Trends
Speculating why we are declaring the food delivery industry as one of the top growing industries in the market then keep an eye out for statistics. So, here we provide the most significant food delivery facility statistics that will motivate and support you in choosing among third-party support or a complete home procedure.
The worldwide food ordering and the food distribution market is valued at around €95 billion and growing continuously. The food delivery statistics online and offline are around 47% and 53%. In 2019 the value of the foodservice delivery market in the UK is reported to be 8.5 billion and in the US 18.8 billion.
The worldwide online food delivery market got a value of US$ 107.4 Billion in 2020. It is forecasted that in 2022 food delivery industry will have a market volume of approximately $146,654.
The restaurant to customer food delivery approach is forecasted to generate revenue of $71,918 million by 2021. Delivery and takeaway food market revenue is predictable to raise at a quick growth rate over the prediction period from 2021 to 2028.
Challenges Faced by The Food Delivery Business & Industry
Challenges arrive exactly like bolt from the blue in the world of food delivery business and industry. Come rain or shine, challenges are supposed to bring new opportunities for business if treated rightly.
Let’s list out the numerous challenges commonly faced by the food delivery industry, have a look.
1. The Logistics Dilemma
The logistic dilemma faced by every single food delivery company. A logistic-related issue that is faced by companies is distribution range limited to a few areas or provide to a broader area, dividing the areas according to high orders, assigning the proper number of vehicles for delivery, certifying the quality of food. Solution of logistic issues can be derived from various ways, check it out.
- Maintain better relations with customers by being responsive, customer friendliness, and providing great support.
- Follow the latest trend in business and make strategies accordingly.
- Resource allocation needs to be done properly it will increase revenue, customer satisfaction, and efficiency.
2. Covid 19 Pandemic
During the covid 19 pandemic food delivery industry faced a big downfall. People were avoiding online food delivery due to the risk of virus-infected food. After the lockdown period was over, the food delivery apps are working furthermore to save their commercial. Nowadays Swiggy and Zomato are maintaining proper food safety parameters for food packaging and informing people about the precautions they are following. Companies are also ensuring that restaurants’ kitchen is clean and the food container does not come into direct contact during delivery. Customers are also getting the option of choosing no contact delivery for food. In contactless delivery, the riders are trained to keep the food delivery parcel at the doorstep of the client and maintain distance when a customer collects the order.
3. Improper Food Handling
Every food delivery company faces problems when improper food handling is done by their representative. Mishandling orders because of a lack of training causes lots of issues and negative feedback from customers. When food is unhygienic for customers this will create a negative impact on the consumers. The solution for this issue can be done by proper training given to the delivery team. Proper training is required to optimize the food delivery experience and hold control over delivery periods.
4. Adhering to the Food Quality Standards
Quality standards are needed to maintain the extreme quality of development and extremely challenging for the delivery. When it comes to food items, most of us incline to frequently purchase similar food that we perceive is of good quality. The food business’s revenues might go crashing down the hill when the quality of food is declined. Quality control is done by identifying and eliminating causes of quality difficulties. The specific team is held accountable for checking the defects in the food quality by inspecting the quality management.
5. Shifting Customer Preferences
The food industry follows a customer-centric approach, by offering the top possible prices to customers at the minimum possible cost. Nowadays customer has lots of option available with the availability of competitors. Customers are getting confused and shift their brand loyalty to a different brand. For solving this issue companies are opting more customer engagement and interaction.
6. Managing Customer Expectations
Taking care of customer expectations is not only the responsibility of the delivery company, restaurant staff is also to be held responsible for the same. Sometimes the difficulty arises when there are differences between the restaurant and delivery companion. Therefore, it is essential to fill a difference and make fulfill customers’ expectations by improving their experience.
7. The Threat of Bigger Players
Popular food delivery apps have more customers that’s why more market share belongs to them. In this scenario, small start-ups face numerous challenges while facing rivalry with popular players in the market. Creating a higher customer base with more value is proven as the biggest challenge for small and new entrant food delivery companies. Businesses have to focus on being the finest among the competitor and start doing something different instead of what competitors are preferring and doing.
8. Inability to Cope with Volumes
In modern times food delivery at the doorstep became a new trend. Restaurants are getting more and more orders from customers who are loyal to their brand or from those who are trying it for the first time. Challenging situations arise when restaurants are not capable of completing the orders while managing the restaurant’s offline orders.
9. Unstable Market Prices
Food costs do not remain the same for a long period. It is difficult for the food delivery business to control market prices. At that time food delivery businesses have to face the struggle to find the correct pricing strategy. Businesses have to be more focused on whether to adopt offensive or defensive pricing models to cope. Approving a price model that doesn’t uninterruptedly alter and drive sales is challenging. Rival’s pricing strategy also affects the pricing strategy followed by the food delivery business. The same problem occurs with giant businesses, with no surety of a hike in sales even afterward cutting the prices.
The sky is the limit for food delivery business with full of opportunities to raise in future, famously quoted “While the challenges are great, so are the opportunities”. The changes in the food delivery market are so rapid that’s why it requires proper attention. So, if you own a food delivery business and want to expand by developing a mobile app then you should be aware of all these challenges.