The rise of digital technology, with greater penetration of internet and smartphone use are driving major changes in the online delivery market in India, allowing online food delivery platforms to capture market by offering a wide range of food products, according to the report.
The overall food supply market in India is expected to clock a CAGR of 12.2% to reach $18.1 billion in FY25 from $10. See the article : Restaurant Technology News Partners with Yelp to Promote Waitlist and Reservations Software with $100 Gift Cards – Plus $1,800 in Free Yelp Ads.2 billion in FY20, said the Sharekhan report. Increasing income and leading a busy lifestyle will increase the growth of online food ordering and food delivery platforms.
The rise of digital technology, with the massive penetration of internet and smartphone usage is driving major changes in the online delivery market in India, allowing online food delivery platforms to win’ market by offering a wide range of food products, according to the report.
The online food delivery market is divided into two business types with different delivery methods – food purchased online through the restaurant’s website and delivered directly by the restaurant and online food ordering and delivery powered by platforms like Zomato or Swiggy.
“The restaurant, unless it is a large organized chain, will not be able to create their property and be profitable. The problem is very big and even if they create it, the number of orders will not be many which they get from the aggregators,” said Sriram Nair, founder of Agility Ventures backed Terra Foods. “Zomato and Swiggy have created all the services and awareness, so it is not possible to do the same on your own.”
The platform delivery segment to customers has shown strong growth between the two types of sales, posting a CAGR of 100% between FY2016 and FY2020, a trend that is expected to continue at a CAGR of 15.1%. up to $9.7 billion in FY25 from. $4.8 billion in FY2020.
“Consumer behavior has changed forever, which has created the need for services. However, for long-term survival they need to be very reasonable about the price and the additional charge that what the customer has to pay for the convenience of ordering. with these devices,” said Dhianu Das, co-founder of Agility Ventures. “So basically, it’s a balance between price and convenience. Passengers should be taken care of by these service providers because if they don’t make money then, this business model will not be successful in the long run.”
QSR is the fastest growing industry in India compared to other sectors in the food service industry. Station QSR leads the industry in terms of number of stores in 2020, with a total of 1,995,104 sales. The total number of channel stores grew at a CAGR of 2% between 2015 and 2020, the highest among all food channels, added the Sharekhan report.
“While there is great enthusiasm for the huge opportunity ahead, QSR business owners are facing a variety of challenges ranging from limited awareness of new food concepts, technology adoption, the visibility of and access to capital,” said Bhavik Vasa, co-founder. CEO at GetVantage. “We are working closely with many QSR founders to accelerate access to growth capital and other resources, so they can invest in areas such as improving technology and equipment, increasing inventory and marketing. This helps improve ts business performance, driving cash flow and expanding their reach. delighting more customers with new culinary experiences.”
After two years of poor performance due to uncertainty caused by COVID, QSR companies are poised to post a solid recovery performance in FY23 and FY24. Most of the companies saw a strong recovery in Q1FY2023 with the average daily sales (ADS) of all companies under coverage improving prior to pre-COVID sales. This was due to the strong recovery in the grain business with the recovery of footfall, the frequency of management through digital platforms and a significant change in popular products. The industry is expecting a strong pace of catch-up in the coming quarters with a significant improvement in same-store sales for many.
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