By Kapil Thakur | January 8, 2024
A busy corporate executive pressed for time and preparing for a post-lunch quarterly review meeting, a hustling working mother who wishes to get her daughter an after-school snack, and a university student excited to surprise his friend on his birthday with a cake at the last minute: three different real-life scenarios & one common thread – online food delivery.
If one application has found a permanent fixture on our mobile phones, then that is an ‘online food delivery application.’ Today’s busy world has interwoven these apps into our lives. This hyperlocal ‘online food delivery’ process may seem simple. However, well-oiled machinery runs behind the scenes with the help of food delivery management software.
What is a Food Delivery Management Software?
The software application synchronously connects customers, restaurants, and food delivery partners. The application enables food order placement, payment processing, food preparation notification, on-time delivery pickups, delivery ETAs, special offers & promotions, and real-time communication with delivery partners. Efficient operation is crucial to winning customers' hearts in this on-demand, hyper local business.
Customers choose their favorite app based on its ability to offer a multitude of restaurants and food options and, most importantly, on-time delivery of their orders. No one wants cold food - delayed food delivery costs not just the one-time order but the entire lifetime value of a customer. According to a consumer survey in the US by ‘The Food Institute,’ 66% of people reported that they would stop ordering from a restaurant or delivery app after a late delivery.
Food Delivery Management: A Spicy Dish
In 2023, the global online food delivery services market is pegged at $143.05 billion with an annual growth rate (CAGR) of 11.5%, according to ReportLinker. The market is expected to grow to $159.46 billion by 2027. Despite the current subdued macroeconomic outlook, the food delivery business seems to score well for a promising future.
However, on the ground, navigating through the complex corners of the on-demand food delivery business is a monumental task. A restaurant must handle hundreds of incoming orders and coordinate with the kitchen ecosystem at any given time. That is only half the battle. Once the orders are processed, allocating those to the right delivery partners and ensuring they reach customers within the promised ETA complete the happy meal cycle.
The winning ingredient is efficient and on-time hyperlocal delivery. To make that happen, any successful food delivery management system follows a five-component process.
- Order Processing: The software interface should be easy and intuitive for customers to place orders in the front end and for restaurants to initiate food preparation in the kitchen. In parallel, the software should be able to scout for the nearest delivery partner.
- Routing and Dispatch: Once the ordered food is ready, the system’s next step is to a create perfect order index, ensuring maximum efficiency, and assign them to delivery partners for on-time dispatching.
- Tracking and Monitoring: An effective system includes real-time tracking and monitoring of food deliveries. This tracking option should be available for both customers and restaurants.
- Customer Communication: The hallmark of food delivery is providing excellent customer service, starting with effective, accurate, and authentic communication. Throughout the delivery journey, customers should be able to connect with their food delivery partners.
- Analytics and Reporting: The restaurant or food ordering platforms should have access to metrics to measure performance on various parameters such as miles traveled by service partners, feedback ratings shared by customers, best delivery partner who scored highest ratings, quick deliveries for on-demand orders, etc.
Taste the Success with a Food Delivery Management System
Based on the use case and business necessity, the features of a system may vary. Still, a few must-have features make up a robust food delivery management system.
Those features include but are not limited to food ordering features, payment gateways, proof of delivery, customer data management, ratings & reviews, chats & notifications, delivery zones, driver crowdsourcing, driver settlements, promotions & special discounts, analytics dashboards, and reports. In addition, there should be slick integration between this food delivery system and the other existing technology stack of restaurants such as POS and kitchen inventory management.
A food delivery management system can benefit a restaurant or a food delivery platform in the following ways.
- Improved Efficiency: Achieve peak efficiency in more than one way. Increase the number of deliveries per driver, maximize fleet utilization, and consistently deliver on or before the committed ETAs
- Enhanced Customer Experience: Win your customers' love by always delivering food on time. Honour repeat customers with special discounts and coupons. Build a cohesive relationship between delivery partners and customers with live communication.
- Cost Savings: Cut back your additional cost on underutilized delivery partners by clubbing same-route deliveries, and save costs on vehicle fuel consumption by optimizing deliveries.
- Real-time Data Insights: Live information can help restaurants tackle immediate problems, such as delayed deliveries due to traffic congestion, and build business expansion plans to include more delivery zones.
Unlocking Growth Opportunities: Hyperlocal Delivery Management Software for Online Food Platforms.
Across the world, the COVID-19 pandemic influenced customers heavily to buy food online, and the sudden surge in online orders forced many popular food ordering platforms to expand their business. Fast forward to the present day; while customers can walk into any of their favorite restaurants, the allure of choosing any food from the comfort of sitting at home facilitated by hyperlocal delivery management software coaxes customers to stick to ordering food with a click of a button on their mobile phones.
According to statista.com, globally, in the meal delivery market, the number of users is expected to reach 2.5 billion users by 2028. Also, Morgan Stanley’s research data indicates that the online food delivery sector is expected to grow with an average annual revenue growth of 14% over the next five years. The Asian and Middle Eastern markets are expected to lead the growth.
Unfortunately, the sector is grappling with challenges such as ever-changing customer preferences, smaller restaurants without logistics support, rising cost of raw materials, food spoilage due to bad packaging, intense competition, inability to standardize high food quality, delays caused by traffic congestion, and failed payment transactions.
A food delivery management software would mitigate the problems above. It allows tracking customers’ food choice patterns, passing on the order details to the kitchen on time, sourcing and making the right food packaging, standardizing food quality, monitoring and tracking delivery orders, and finally, having an inbuilt system for successful payment processing.
FarEye Offers the Perfect Recipe for Food Delivery Management
FarEye has been transforming the delivery logistics of the world’s largest brands for nearly a decade. It simplifies last-mile logistics, ensuring deliveries are made on-time, every time. With its low-code/ no-code platform and feature-rich product suites, FarEye can help food delivery management companies in the following ways:
Real-time Dynamic Routing: The software can predict road congestion, peak hour traffic, unforeseen accidents and automatically suggest the quickest and optimal routes for food delivery partners
ETA Accuracy: On-time arrival of food is essential to get higher customer ratings. The software uses real-time geo-location traffic data and provides accurate ETAs
Improved Customer Service: Unique features such as perfect order index, special discounts, live order tracking, and open communication with delivery partners will help you score good ratings
Reduced Operational Costs: The loop optimization algorithm can help decide the quickest way to reach a maximum number of customers with minimal drivers. Cut back costs by reducing miles traveled, fuel consumption, and the total number of drivers
Automatic Scheduling: The software creates a perfect order index, identifies the nearest driver for order allocation, and automatically assigns the order without manual intervention
Digital Payments: Customers love the convenience of cashless transactions and to use the payment method of their choice for ordering. Our system allows integration with multiple payment gateway options
Crowdsourcing: Using our crowdsourcing app, onboard new drivers as and when your food demand order demand rises. Slash permanent overhead costs.
Track-in Real Time: Customers can track their orders in real-time, from meal preparation to pick-up by a delivery partner to traveling on the road until they reach the final destination. This end-to-end visibility assures customers that they will receive their orders on-time
For Domino’s Pizza, a multinational pizza company with 4000 stores across the United States, FarEye boosted delivery experience, enhanced resource planning, and shrunk delivery time through in-app gamification. The average delivery time was reduced to 22 minutes from 30 minutes – a 27% reduction in delivery time.
Embracing Efficiency-First is the Way Forward for Food Delivery Business
Rapid urbanization, the convenience of ordering food from homes, and the joy of trying various dishes have made customers love ordering food online. The food delivery business is here to stay and will continue to grow in the coming years. As the sector is poised to flourish, we can anticipate intense competition amongst existing players. There is also a likelihood for new entrants to penetrate the market and vie for the pie.
With competition on one end and demanding customers on the other end, a food delivery business can stand out only when it can operate with the highest efficiency and serve customers with excellence. That is possible by selecting the right food delivery management software, which frees up from logistics pitfalls, helping delivery partners to serve hot and delicious food for every customer order.
Kapil Thakur, is a seasoned Solution Consultant with a decade of rich experience in Information Technology, Services, and Digital Transformation within the Logistics and Supply Chain domain.
Throughout his career, Kapil has collaborated with clients spanning diverse industries and geographies (APAC & EMEA), ensuring the successful execution and implementation of Logistics and Supply Chain projects with an innate understanding of client needs, aligning them with business goals, and designing tailored supply chain & logistics solutions.