Food Delivery Startups
Food delivery startups aim at following an approach that helps people save a lot of time and effort. It offers convenience and the fastest way to choose favorite meals straight from the mobile devices to get them delivered wherever people want. And, the pandemic restrictions and safety regulations have further resulted in an unprecedented surge in the popularity of online food delivery apps. Such startups leverage traditional food-delivery models and Talabat is one of them when it comes to the Middle East and North Africa.
Started in 2004, Talabat is one of the top food-delivery app giants which has been successful in revolutionizing the concept of food delivery in the MENA region. After several years of successful business,Talabat acquired Zomato in 2019 for $172 Mn, which forced UberEats to close its operations in these regions.Sounds amazing- isn’t it?But, that’s just the tip of he iceberg.In this post, we’ll delve deep into Talabat’s business and revenue model and discover the reasons why you should invest in Talabat-like app development.
TABLE OF CONTENTS
- Food Delivery Apps in the Middle East: Past, Present, and Future
- The Rising Demand for Apps Like Talabat
- About Talabat App: An Overview
- Talabat Business and Revenue Model
- Business Model of Talabat
- Revenue Model of Talabat
- Talabat Features List
- Why Should You Invest in Talabat-Like App Development?
- How Much Does It Cost to Develop a Talabat-Like Food Delivery App?
- Why Choose Esferasoft for Talabat-Like Food Delivery App Development?
Food Delivery Apps in the Middle East: Past, Present, and Future
The online food delivery market is surging worldwide, and the Middle East is no different. The demand for online food delivery in the Middle East and North African (MENA) nations is on the rise, with Saudi Arabia, UAE, and Kuwait being at the forefront.
Image Source: Statista
Let’s crunch some numbers to provide you with a better idea of the food delivery market environment in MENA.
- The online food delivery market in Saudi Arabia is projected to reach $2.25 billion in 2024, with a CAGR of 8.2%
- The UAE foodservice market was valued at $15 billion in 2019.
- The Restaurant-to-delivery segment in Kuwait is projected to reach $519 million by 2024, with a CAGR of 26.3%.
Another recent eport suggests that the global online food delivery services market is expected to grow from $115.07 billion in 2020 to $126.91 billion in 2021 at a compound annual growth rate (CAGR) of 10.3%, and is expected to reach $192.16 billion in 2025 at a CAGR of 11%.
The Rising Demand for Apps Like Talabat
The three main reasons behind the increasing popularity of online food delivery in the Middle East are:
- The rise of the global online food delivery market
- The growth of online shopping and eCommerce in MENA
- The increasing demand for food delivery apps like Talabat
Of these three factors, the increasing demand for Talabat-like food delivery apps has been the biggest driver of the food delivery sector’s growth in the Middle East.
Presently, Talabat is the biggest player in the market.
Earlier, the Middle East had three main food delivery services: Uber Eats, Talabat, and Zomato UAE. But in March 2019, Delivery Hero Group-owned Talabat acquired Zomato UAE, giving it a massive boost and the majority market share in the region.
Uber Eats, which is regarded as one of the best food delivery apps in the world, had to shut down its service in Saudi Arabia, UAE, and Egypt.
The service provider wasn’t able to keep up with the fierce competition and the increasing dominance of Talabat.
Another factor for Talabat’s massive success is its exclusivity. Talabat has put clear conditions that it’ll partner with only the restaurants that agree to cancel their partnerships with other food delivery apps like Deliveroo and UberEats.
Also, businesses don’t want to get sandwiched between multiple delivery services, so they’re moving to exclusive partnerships.
About Talabat App: An Overview
So, what is Talabat, and what’s so special about it? Talabat is a Kuwait-based food and grocery delivery company founded in 2004 by Abdulaziz Al Loughani. It operates in seven countries: Kuwait, Saudi Arabia, UAE, Qatar, Bahrain, Oman, and Jordan.
For the most part, it works similar to other globally renowned food delivery apps like UberEats and GrubHub. Restaurants can list themselves on the platform, and customers can order food from the restaurants for their choice.
Talabat is available in the form of a website and mobile app for Android and iOS. In addition to food delivery, it enables the hiring of delivery persons and managing logistics.
Talabat Business and Revenue Model
In this section, we’ll discuss the business and revenue model of Talabat. Let’s begin with the business model first.
Business Model of Talabat
Talabat’s food delivery side of things is similar to other popular food delivery apps. Here’s how the process works:
- Restaurant partners with Talabat and lists itself on the platform.
- The customer registers on the app and browses dishes from his favorite restaurants.
- The customer selects the dishes, chooses the payment mode, and confirms the order.
- The restaurant receives the order and starts preparing the meal.
- The restaurant chooses the delivery person to deliver the order.
- The delivery person picks the order from the restaurant and delivers it to the customer.
- The customer gets real-time order status updates.
The on-demand delivery model also works the same way. The delivery service providers partner with Talabat and list themselves on the platform. The restaurants can browse from the delivery providers and select the one they like.
Talabat targets people who prefer to order food online instead of walking in restaurants to collect their orders. The customer base mainly includes Gen Z and millennials who want warm and delicious food delivered to their doorstep.
Revenue Model of Talabat
Like most food delivery services, Talabat relies on three revenue streams: commissions, delivery charges, and advertisements. Let’s understand these components in detail.
Talabat doesn’t have a flat commission model. It charges 15-25% of the total order amount from the restaurant. However, Talabat focuses on exclusivity. So, restaurants that partner exclusively with Talabat get a 5-10% reduction in commission rates.
The commission charged by Talabat on every order depends on multiple factors, such as restaurant location, order frequency, reliance on the restaurant, etc.
2. Delivery Charges
Talabat charges a delivery fee on every order. The delivery charge is not fixed and depends upon factors like the distance from the restaurant and environmental conditions. The rates are higher in the case of a storm, late-night delivery, or high demand.
Talabat enables customers to cut down and eliminate delivery charges by ordering above a threshold amount. This is a prevalent strategy used by many other food delivery providers.
3. Advertising Costs
Talabat offers two types of advertising opportunities to restaurants: priority listing and banner ads. In the priority listing model, the restaurant gets a chance to appear on the top of the restaurant listings.
Banner advertising, as you probably already know, involves showing banner ads within the app. Talabat deploys these two models to generate advertising revenue.
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Talabat Features List
Talabat has a comprehensive range of features and modules divided across the following panels:
- User Panel
- Restaurant Panel
- Delivery Boy Panel
Let’s explore the key features of each panel.
1. User Panel
The user panel comprises the following features:
Login and signup
Users can easily create a login via email or mobile number, which they can easily use whenever they use the Talabat app for food delivery.
Along with the availability of detailed information about the available restaurants, people can also search on maps to choose their preferred location.
Talabat app offers an intuitive home screen that offers a user-friendly and organized view of the available restaurants. The menus are arranged in order that helps users quickly select their favorite restaurant to order online food.
Once you select your preferred restaurant to order online food, you’ll be directed to the inner menu that encompasses all the necessary information including the name of the cuisines, dish images, prices, quantity, user feedback, and all the relevant information.
Setting pickup location
Setting up the pickup location is easy. Either type in the details or simply turn on the GPS to allow the mao to automatically fetch your current position.
Handling the cart is super easy. One can see the total cost (including taxes), which changes when a user makes changes with the item quantity directly by clicking on the plus or minus button.
Offers and discounts
Customers are frequently intimated about the available offers and discounts via push notifications.
Order status and tracking
Food ordering and tracking are pretty convenient with the Talabat food delivery app. The app offers live order tracking feature for the customers to exactly have an eye on their order status.
Customers will have access to the delivery boy and restaurant’s contact information. This is really helpful in various instances such as if you want to convey a special instruction or sharing information about the route and directions.
The search bar is handy when a customer wants to search quickly to find out their favorite dish or a restaurant. All they need to do is type the name of the dish or restaurant and the search results will be displayed in seconds.
Before finally placing the order, customers are redirected to the review screen. As the name suggests, the screen entails all the selected items, quantities, prices, and addresses to avoid any discrepancies before placing the order.
Multiple payment methods
Talabat online delivery app offers various options to pay for orders including credit card, debit card, cash on delivery, and more.
2. Restaurant Panel
Apart from the customers, the Talabat app also offers a few exceptional features for restaurant owners:
The owners have to first set up their profile with the Talabat online delivery app. Once they are done with the registration, the owners are redirected to the dashboard where they can access all the essential details including pending orders, completed orders, and orders on processing.
Accept or decline orders
There are several cases that a restaurant owner has to look at before accepting the order. They must be assured about the timely delivery and quality of their products. Hence, the restaurant owner can accept the order if he feels that staff will be able to meet the quality and delivery of the order, else he can decline the order as well.
Dedicated restaurant account
Each restaurant owner will be assigned a dedicated account, which stores all the necessary details such as a total number of accepted, rejected orders along with the transaction history, and more.
Owners can have the full view of the number of order requests showing order quantity, pricing, address, and payment details.
Delivery boy information and real-time status
Restaurant owners also have the leverage to see the real-time delivery boy status that helps the staff to prepare the dishes on time.
Other restaurant features include calls and chat, push notifications, order history, transaction history, payment withdrawal, and more.
3. Delivery Boy Panel
The delivery boy panel comprises the following features:
The Talabat food delivery app allows the delivery partner to create their unique login ID to access their dashboard whenever they are available for delivering food. They need to add their details including name, address, contact number, etc.
Commit or cancel the order
Whenever a customer places an order, the delivery boy gets notified about the same. The notification includes all the relevant details such as name, address, contact number, order quantity, and restaurant details. From there, he can accept or decline the order according to their order details.
Just as customers, the delivery partners also have the leverage to track the exact customer location in order to deliver the order at the earliest.
In-app call preference
Also, the delivery boy has the option to make a call to the customer and the restaurant owner for any inquiries regarding the order, quantity, or location.
This feature allows the delivery boy to see all the orders he has delivered in the past. This can be useful at the time of having any discrepancies regarding payments and customer feedback.
Delivery partners can keep track of their total earnings via the revenue history feature. This allows them to analyze how they have earned in a given period of time i.e. daily, weekly, or monthly.
Ratings and tips
This feature is an added advantage for the delivery partners, which allows them to collect tips in the form of virtual cash, and ratings to help them perform better in order allocation.
4. Admin Panel
The admin panel consists of the following features:
- User accounts
- Content management
- Discount functionality
- Coupon codes
- User management
- Location tracking
- List of orders
- Order processing
- Push notifications
- Reports and analytics
- Revenue management
5. Additional/Miscellaneous Features
In addition to the panel-specific features discussed above, an app like Talabat can have additional features, such as:
- CRM Integration
- CMS integration
- Loyalty program
- Application Personalization
- Security Guarantee
- Multi-Currency & Language Support
- Cloud Environment
- Social Sharing & Registering / Entering
Why Should You Invest in Talabat-Like App Development?
If you’re a business owner, entrepreneur, or solopreneur, investing in Talabat-like app development can lead to numerous opportunities. The food delivery sector is growing, and the next four to five years have a lot in store for online food delivery businesses.
Here are some top reasons to invest in on-demand food delivery app development.
1. Guaranteed Growth
As mentioned earlier, the food delivery market is booming, not only in the Middle East but worldwide. Yes, the market is largely dominated by Talabat, but there’s always room to break in. If you come up with a unique, innovative idea, you can experience substantial growth.
Another reason why a food delivery business is destined to succeed is the increasing number of people ordering food online. With COVID-19, in hindsight, rarely anyone wants to go to a restaurant to dine or pick up food. Everyone is ordering food online, which has given birth to numerous opportunities in the food delivery sector.
2. Easy to Get Investment
Zomato UAE had grown big in UAE and probably would’ve outranked Talabat in the future. To neutralize competition, Talabat acquired Zomato UAE.
Moral of the story? Investors are continuously looking for on-demand food delivery apps. If you have an amazing idea, you can raise a significant amount of capital to support and scale your operations.
3. Endless Possibilities
As discussed, Talabat generates revenue from three income streams. And the interesting fact is that the company hasn’t even exploited all the revenue options. Here are some common revenue models you can deploy in your on-demand food delivery app.
- Commissions from restaurants
- Delivery charge
- Transactional commission from customers
- App subscription fee
- Peak hour fee
- Sponsorships and partnerships
You can also develop exclusive relationships with restaurants like Talabat does. Now, of course, you don’t need to deploy all the revenue models at once in your app. Select the best revenue stream that suits you depending on your customers and the business environment.
4. Seamlessly Target Millennials and Gen Z
We live in a time where the youth has outnumbered middle-aged adults and baby boomers. The worldwide Gen Z population in 2020 was 2 billion, followed by 1.8 million millennials. Together, they make up 3.8 billion, which is more than half of the world’s population.
What’s more, most purchase decisions in today’s age come from the younger generation. And since these younger customers are the majority of consumers of food delivery services, a food delivery app provides you with an excellent opportunity to target them. So, if you’re looking for a youth-centric business model, an on-demand food delivery app is your way to go.
5. Employee-Friendly Business
When you launch an on-demand food delivery business, you provide more than better-earning opportunities for restaurants and a seamless food delivery experience to customers. A food delivery business enables you to generate employment and job opportunities.
COVID-19 continues to wreak havoc on the job market, as the world lost more than 600 million jobs during the second and third quarters of 2020.
To run an on-demand food delivery business, you need delivery agents. So, you can increase employment in your country and locality. Besides, you can provide flexible working opportunities for your employees.
Your delivery agents can work either full-time or part-time and earn incentives on completed deliveries. Customers can also tip the agents for their efforts.
6. Global Opportunities
Talabat acquiring Zomato UAE is just one example. In the US, Uber acquired Postmates, one of the biggest food delivery apps in the country. Nowadays, online food delivery is booming in every country, and people like options. So, entering the food delivery sector comes with a plethora of global opportunities for you to explore.
How Much Does It Cost to Develop a Talabat-Like Food Delivery App?
If you’re looking for a ballpark figure, it can be anywhere between $10,000 and $100,000. However, depending on your requirements, the cost can end up being lower than $10,000 or cross the $100,000 mark. Several factors affect the cost of development, such as:
1. Type and Size of App: The type, size, and complexity of the app will govern its cost of development. Hybrid apps with simple functionality are less expensive, whereas native applications with complex functionality tend to cost more.
2. Platforms and Devices: You can develop a mobile app for myriad platforms, such as Android, iOS, Windows, Blackberry, Android TV, wearables, and more. The more devices you choose, the more the costs will rise. Developing and maintaining a website, if you decide to make one for your business, will also add to your operational costs.
3. Structure of a Team: You can either hire a freelance developer or a full-fledged on-demand app development company like Esferasoft for your project. Freelancers are cheap and often unreliable, especially if your project is large-scale. Companies, on the other hand, have an entire team, including a project manager, app developers, QA engineers, UX/UI designers, and more. For this reason, development companies charge more.
4. Location of the Developer: The same quality of app development costs $10-80 per hour in South Asian countries like India and Indonesia, $50-150 per hour in Western Europe, and $100-250 per hour in the US.
5. Features: As discussed, a typical food delivery app has four panels: user, restaurant, delivery, and admin. Each panel has a set of features. Developing an app with more panels and features will cost more. Hence, feature-rich apps are costlier to develop.
6. Post-Development Expenses: Developing an app is just the beginning. You’ll need to launch the app, market it, and continuously upgrade it to ensure customer satisfaction. All these add-ons come with additional costs depending on the developer.
Technology Stack for On-Demand Food Delivery App
The technology stack you deploy will depend on the type, platform, and requirements. That said, here are some general elements a technology stack for an on-demand food delivery app would consist of.
- Backend Development: Languages, frameworks, web servers, database management systems
- Android Development: Kotlin, Java, Android Studio, Android SDK
- iOS Development: Objective-C, Swift, Apple Xcode, iOS SDK
- Hybrid Development: PhoneGap, Ionic
- Payment: Stripe, Braintree, PayPal
- User Location Finding Google Places API
- Direction Finding Google Maps, MapKit
- Registrations: Gmail SDK, Facebook SDK
- Storage: AWS, Azure, Google
- Analytics: Google Analytics, FireBase
Why Choose Esferasoft for Talabat-Like Food Delivery App Development?
So, you have a unique on-demand food delivery app idea in mind. Now what? Is your idea viable? What about analyzing the competition?
And even if you sort these things out, you’ll have the monstrous task of developing a full-fledged food delivery app from scratch. Sure, you can try getting it developed in-house, but then you’ll be losing out on the expertise and experience outsourced developers bring to the table. Besides, in-house development is almost always more expensive.
Esferasoft can help as we have over a decade of experience in on-demand app development, we offer the perfect blend of expertise, innovation, and flexibility. Our client-focused solutions help you turn your dream food delivery app idea into reality.
Here’s why you should choose Esferasoft as your technology service provider.
- White label solution
- One-time cost
- Own your code
- Free technical support
- Customizable and scalable
- Save time and money
Note: This is to clarify that Esferasoft Solutions is not involved in the development of the Talabat app and in any other way. Our team of experts reviews the successful on-demand businesses and shares their insights and understanding via the Esferasoft blog. However, if you have a similar project idea in your mind, then you can discuss the same with us and, our ready to launch on-demand solutions can be helpful to you. Contact us to know more.