New Year resolutions are hell on the restaurant business. Just in case you thought you were the only one trying to lose some weight, take a look at the graph above.
Between a broken supply chain — spread across multiple stake holders and bad customer experiences — consumers are punishing food tech start ups that fail to deliver value. Zomato missed the Diwali bus completely — a fillip that every other company took advantage of.
Swiggy Dominating. As a delivery first company this makes sense. They entered the game early and built a core competency around owning the entire value chain and therefore the customer experience. The fruits of that labour are plain to see.
Orders at Swiggy hover at the industry average (Rs. 300) but their customers tend to order far more frequently. The implications these numbers have on annual order value per customer are interesting.
We’re seeing a number of different models in Food Tech emerge:
- Complete Ownership — Dominos & Faasos — take ownership of the entire supply chain and production
- Asset light — Zomato & Food Panda — rely on large traffic volumes for order generation but outsource delivery to third parties.
- Hybrids — Swiggy — focus on providing a seamless user experience by controlling the customer experience and logisitics.
Dominos and Faasos are platform agnostic — they can simply plug into any platform that will feed them orders. Food Panda, Zomato & Swiggy will have to battle it out for user mind share and more importantly, space on our phones.
Thanks for your time,
Ashish
- Team KG
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You can reach me on ashish@kalagato.com
