How to Start a Food Delivery Business

The online food ordering & delivery companies like Deliveroo, UberEats, Grubhub are becoming popular names in the food industry. The success of these food delivery companies attracts the aspiring entrepreneur to invest in this business.

The rise of digital technology is changing the whole market. Customers are addicted to shopping online through mobile apps.

Mobile apps offer various facilities to their customers like convenience, transparency, discounted offers, etc. so that customers prefer to shop online. So customers want to expect the same experience with food ordering & delivery apps. That is why food delivery businesses prefer to build a powerful mobile app for their business.

If you are also looking to enter the food delivery industry then before that you need to know the basics of the food business.

In this article, I will share about how to start an online food delivery business, how it works, the business model, where to start, and why you need to start this business, etc. so that you can easily start your own business in the food industry.

Revenue in the online food ordering & delivery business is expected to increase with an annual growth rate of 9.5% by 2024.

Business Model of Online Multi-restaurant Food Ordering & Delivery Services:

Multi-restaurant food delivery business model work in a three-way marketplace. The food delivery app connects customers, restaurants, and delivery services. Restaurant owners list their brand name, food menu in the app, customers search the listed local area restaurants, compare the restaurants (as per food price, review or rating based), place the order. Delivery agents get the order notification then pick the food order from the restaurant and deliver it to the customer's address.

Why Investing in an Online Food Delivery Business is a Good Idea?

• Low operating cost
• Various revenue generation channels
• Profitable business idea
• Easy to start
• High demand
• Multiple online business ideas in the food delivery sector

Big Players in the Food Delivery Industry

• UberEats
• GrubHub
• Zomato
• Deliveroo
• DoorDash
• Postmates

Revenue Generation Channels in the Food Delivery Business

Where the money will come from a multi-vendor food delivery business? It is the most common question that every entrepreneur wants to know!

There are multiple ways where you can earn money in a food delivery business, unlike the other business models.

Delivery charges: You can charge money from every delivery. It can be different as per your business like Grubhub charges 10% -15% on every delivery.

Commission fee: App owners can earn a few amounts from restaurants as per commission on every order. It can decide between the restaurant owner & app owner.

Advertisement: You can charge fixed money by advertisement. Restaurant owners pay a fixed amount to the delivery company to come up with their restaurant on top of the app because it increases the restaurant sale.

Sponsored or feature listing: Company can earn money by sponsored listing.

Subscription-based: Food delivery company or app can earn money from customers by subscription. It can be weekly, monthly, etc.

How To Develop A Food Delivery App Like UberEATs and Deliveroo?

To start an online food delivery business similar to Deliveroo & UberEats you need to develop a powerful food delivery app or website. For that, you can choose an app development company or choose a readymade food ordering & delivery marketplace software. It will depend on you which one you opting. That decision depends on multiple factors like cost, time, features, etc.

As an industry expert, I would suggest you go with a ready-made marketplace solution like YoYumm. It can save valuable time and a lot of investment as compared to building an app from scratch.

Because custom development requires a lot of time and it can be expensive. So a ready to use food delivery marketplace software is always the best decision for you.

You can choose YoYumm, a multi-restaurant food delivery software solution that creates features rich mobile apps for your food delivery business. It is a fully customizable solution so you add your business requirements features easily.

Also check out the Top 5 Multi-Restaurant Food Delivery Software