There are several aspiring entrepreneurs who want to invest their money somewhere but do not know which industry is the best to put their money that would offer them maximum returns. The food industry over the years, has grown remarkably and has been expanding at an astounding speed.
Globally, the food delivery market accounts for €83 billion, which is 1 percent of the total food market and around 4 percent of food sold through restaurants and fast food outlets. The food industry has matured in most countries, with an overall annual growth rate estimated at 3.5 percent for the next five years.
By far, the most common form of delivery is the traditional model, in which the consumer places an order with the local restaurant over the phone and waits for the restaurant to bring the food to the door. This traditional category has a 90 percent market share, and most of those orders—almost three-quarters—are still placed by phone.
However, as in so many other sectors, the rise of digital technology is reshaping the market. Consumers are getting accustomed to shopping online through apps and websites which offer maximum convenience and transparency. The same can be said when it comes to ordering dinner. Now people prefer to order goods on the run as it’s not feasible to order on the desktop whereas, people are ordering what they want with a few taps on the phone.
In early 2013, new players emerged in the food delivery sector. In this sector, users order meal through ‘food delivery app’ from the desired restaurant. Customers can order food from both food ordering or food delivery application but the major difference is, rather than going on the website’s app of a particular restaurant, the user gets all the restaurant listed in food delivery app. Some example of such apps is UberEats, Zomato, FoodPanda, etc.
In this blog, we are not just preaching that entrepreneurs should invest in an online food delivery marketplace. We are providing facts and figures which will show the huge demand and opportunities for entrepreneurs in the online food delivery sector.
When every offline business is stepping in the online world, the food-delivery market is in the middle of a huge channel migration. Every business is now creating its own mobile app to become a part of the ever-growing online business.
According to BI Intelligence:
“Orders placed via smartphone are expected to account for more than 10% of all quick-service restaurant sales by 2020, at which point mobile ordering is expected to be a $38 billion industry’’
Mobile apps are surely playing and are going to play a vital role in any online business. Investing in a mobile application can be the best move in the coming future.
In the year 2015, there was a huge debate on whether hyper local businesses will be able to shift to online businesses. One sector which grabbed maximum attention was the food industry. The reasons were that it is expected to see revenue of $78 billion by 2018, which will subsequently grow 16 percent. This sector has always shown high demand and looks promising for higher returns. Now the sector is overflowed with “Me-too startups” which are lacking both differentiation and innovation, there is a huge demand for out of the box startups that entices the customers with its features.
Now let’s take a look at Revenue section of Online Food Industry, globally and in different countries:
The question always arises about what the internet holds for businesses. As we’ve read above, digitalization is reshaping the Food market but let’s talk in numbers. In research by McKinsey, it was found out online’s penetration of the total food-delivery market broke 30 percent in 2016. They predicted that the penetration rates will grow as the market mature, eventually reaching 65 percent per year.
Other industry stats and figures that show that the food ordering industry has huge potential:
With all the above-mentioned facts and figures, it can be concluded that shifting your food business online or establishing your new business in the food industry can be the right choice. Of course, not everybody is meant to be in the Food Industry, but every business must shift online for steady growth. One can always choose the best business models which suit their interest and field.
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