Consolidation Expected in Food Delivery Players

Food Delivery App
Food Delivery App

Fueled by the Covid pandemic for the past 2 yeas, demand for food delivery increased. According to research, the market for online meal delivery in Singapore will grow to US$1.5 billion in 2023 with 3.69 million customers in another 4 years time which is 2027. Among the three primary platforms in Singapore, Grab has a market share of 56%. Foodpanda, by contrast, controls 35% of the market, while Deliveroo holds 8%.

Grab holds the advantage with integrated apps that provide other services like transport and finance. in addition, Grab having a larger volume and drivers can create synergy with more deliveries been made per trip. Grab also have innovative features in food delivery mode like Saver and priority.

Saver delivery mode will take longer time but cheaper, priority delivery will ensure the food is delivered faster otherwise grab will compensate for the delivery fee. Priority service is especially handy when you want to impress your mother in law! Grab do not offer free delivery, it has a subscription model that helps customer save a certain amount of cost from the delivery fee.

Deliveroo been the smallest player is facing an increasing difficult situation with growing their business even though they stands out been the only Singaporean subscription service that “offers truly free delivery on all orders.”

Players that might break into this food delivery industry can come from related industry whom have high degree of driver network. for example Amazon, who have their Amazon Flex Freelance Delivery

With mounting cost of operation, the three largest food delivery players Grab, Foodpanda and Deliveroo are cutting costs significantly. Two rounds of layoffs were held by Foodpanda, and roughly 10% of Deliveroo’s worldwide workforce was eliminated. Grab informed its staff that it will be freezing executive salaries and reducing travel and entertainment (T&E) spending.

With the expected challenges ahead, we do expect Consolidations in Singapore’s crowded food delivery market are increasingly likely.

- Advertisement -
Kim Jio
Commander-in-Chief @ Firstlane Swam to Sunny island to escape from the half-brother who ruled with an iron-fist and feed the family with needles or to dogs. Kim is my family name and Jio is my favorite fruit. Screwing around with Uber & Grab since 2014