What does the future hold for food delivery companies?
COVID-19 has disrupted the world and many industries have fallen under the pressure of the crisis.
Food delivery, on the other hand, is experiencing an unprecedented surge.
The Information states that sales of UberEats increased by 10% in a matter of only a week. The number of users signing up for food delivery surged by 30%. These changes were most certainly due to the outbreak of COVID-19 and the resulting lockdown.
Social distancing puts the restaurant business in a very difficult position. On-demand food delivery app development is the only way for some people to keep their food businesses afloat.
The uncertainty about the COVID-19 situation and the promised growth of the food delivery services market by $104,45 billion during 2019-2023 is a good sign that right now is the time to invest in food delivery app development.
If you want to develop a food delivery app similar to Uber Eats, this article will tell you how to do it right. As you read the article, you will find yourself immersed in the following concepts and steps:
- why there is still a place for new names in the market of food delivery applications
- how food delivery apps work + business model overview
- best strategies to turn food delivery into a successful business
- key challenges of food ordering app development + steps to overcome them
- how to make your own food delivery app step by step [analysis + development + marketing]
- food delivery app features list that any successful app should have
- technical integrations of food delivery app development
Let’s dive right into the technical and business details.
Market Potential & Reasons to Invest in Food Delivery App Development
With dozens of successful food delivery apps examples, the market might seem overcrowded. Still, there is enough space for new and aspiring names.
In this part of the article, you will learn about your main future competitors and how to turn the investment in food delivery startups into a successful project.
On-Demand Food Delivery Market Leaders
There are a few leaders that share the biggest segment of the market. If you decide to invest in creating a custom food delivery app, you will have to compete with these companies.
Therefore, let’s take a look at the main players in the market.
- UberEats
When talking about the most popular food delivery applications, one can’t ignore UberEats. This world-famous app grabs 27% of the food delivery app market in the United States and offers services in 500+ cities in 24 countries.
- Gopuff
This application offers delivery of snacks, drinks, grocery delivery, and almost any other products directly to users’ doorsteps. The application is available across the United States and has a huge presence in 150 cities located in the South and Midwest.
MLSDev offers software development services and stands behind the technical implementation of Gopuff. A dedicated team of developers worked on the project from scratch and witnessed its steady growth toward steady business. These days, the service is available on iOS, Android, and a web client.
Do you want to know how to turn a food delivery app development idea into a successful project?
Check out the Gopuff case study where we provide an in-depth overview of all the processes underlying the well-known application. You will learn the ins and outs of the food ordering app development process and better understand what it takes to develop a successful app.
Are you interested in food delivery app development services?
Get in touch with us to discuss the project idea you would like to implement. Our experts will provide you with recommendations on how to create an on-demand delivery app that will rival UberEats and fulfill the market’s needs.
- GrabFood
This application offers the delivery of food from well-known restaurants and fast food chains like Empacho Restaurant and Bar, Jollibee, McDonald’s, and Burger King. The service is available in 5 regions of Thailand and the company plans to expand its services in the future. The application has over a million installs on Google Play alone.
- Zomato
This application started in 2008 as a restaurant search platform. Later, the company added the functionality of food ordering and is now providing services in 25 countries all over the world. The application has over a hundred million app downloads worldwide.
- Otlob
Otlob is a successful food delivery app and website operating in Egypt. This restaurant app has over 5 million app downloads, operates in more than 25 cities, and offers food from over 2,000 establishments. This is a great example if you are looking into food delivery website development.
- Glovo
The application has the status of one of the most downloaded food delivery apps with over 30 million downloads. The company operates in over 26 countries and 200 cities and has 20,000+ partner restaurants, shops, and stores, including McDonald’s, Papa John’s, and many others.
- Postmates
This application offers the delivery of almost anything to your doorstep, from products to alcohol. The service is available in all 50 US states and 4,200 cities.
- DoorDash
DoorDash helps users get drinks and food from their favorite restaurants in the USA and Canada. The restaurant app is available in 800+ cities and provides a unique feature that allows customers to rate cafes and delivery services.
- GrubHub
The application is designed to help customers get their favorite meals from local restaurants. GrubHub has both Android and iOS applications and is available in London and over 3,200 US cities.
- Domino’s Pizza
This is a great example of an application built for an already world-famous pizza restaurant chain that has over 60 years of history. The app provides services all over the world, in countries where its restaurants are located. Domino’s Pizza is a great example of branded pizza delivery app development done right.
The listed applications help to get a grip on the main trends on the market and identify the features these apps consist of.
This information will help you make an analysis for your future food delivery app development.
Business Models for Food Ordering App Development
Today, people consider food delivery more convenient and safer than dining out. There are speculations that people will get used to ordering food and that these apps will gradually displace in-person grocery shopping and dining out.
If you decide to pursue on-demand food delivery app development, you’ll need to know about the main business models for these apps.
Note that food delivery app development might be interesting not only to restaurant owners, but also to enthusiasts who want to replicate the success of well-known applications.
Aggregators
This food ordering app development business model implies direct cooperation between restaurants and an aggregation platform.
How does the aggregator model in a food delivery business work?
The platform acts as an intermediate between customers and restaurants, and can either provide delivery services or not.
A traditional aggregation platform takes care of taking orders and sending them to nearby restaurants, while delivery is fulfilled by the restaurant’s in-house couriers. Platforms with logistics accept orders, send them to restaurants, and take care of delivery with their own couriers.
Aggregators without logistics work this way:
- A user chooses food and places an order
- The payment is placed within the system
- The restaurant receives the order and prepares it for delivery
- The food is delivered by the restaurant’s courier
- The payment is deducted
Almost all famous, big names in the food delivery industry started as aggregators without delivery functionality first, including Just Eat in the UK, Grubhub in the USA, and Delivery Hero in Germany.
Aggregators with logistics work the following way:
- A user chooses food and places an order
- The payment is placed within the system
- The restaurant receives the order and prepares it for pick-up by the platform’s courier
- The food is delivered by the platform’s courier
- The payment is deducted
A great example of this sort of app is UberEats, which uses its own couriers to deliver orders to customers.
Hybrid platforms
If you decide to develop a food delivery app of this type, you will not need to make a significant investment upfront. First, you need to hire a food delivery app development company that will take on the technical tasks and find third-party delivery companies that will deliver your orders.
These applications are great for small businesses that want to build brand loyalty with a branded app, but don’t have enough resources for their own vehicle fleet.
Here is how a hybrid system works:
- A user chooses food and places an order
- The payment is placed within the system
- The restaurant receives and packages the order
- The app’s admin sees the order and sends it to a third-party courier for pick-up
- The food is delivered by the third-party courier
- The payment is deducted
Some great examples of this kind of application are Panera Bread, Carrabba’s Italian Grill, and Outback Steakhouse, which use their own branded apps and third-party delivery companies. Panera Bread cooperates with GrubHub, DoorDash, and Uber Eats for food delivery.
Why Restaurants Should Invest in On-demand Food Delivery App Development
Food delivery app development is also beneficial for restaurants and food chains. If you are wondering how to make your own food delivery app and whether it’s worth it, the answer is presented in the next section dealing with generated revenue.
For restaurants, working with existing applications is not always beneficial, as they might face the following pain points:
- High dependency on the delivery partner & fee payment
Working with third-party delivery applications like GrubHub or Zomato implies paying delivery fees and relying on apps that can change the rules of the game at any time. As a result, you might need to pay more for these services, which will cut into your income.
- Inability to control the quality of delivery services
You rely on a partner that works with your competitors and won’t prioritize your orders over others. Therefore, you cannot ensure that your customers will get the best experience from online food delivery.
- Lose a chance to build customer loyalty
Often, delivery partners don’t pay close attention to the restaurants they are ordering from, instead, they grant all the credit to service providers.
Given all of the above combined, food delivery app development is, therefore, a solution for companies that want to build brand loyalty and provide customers with an exceptional experience. You can easily tackle these problems by creating your own branded application.
Revenue Streams for Food Delivery Apps
There are multiple ways in which food delivery apps can generate revenue. Let’s check them out to understand how to create a food delivery app that will become successful.
- Commissions
You can center your on-demand food delivery app development process around this business model. These applications earn money on commissions. Whenever a customer orders something from a restaurant, the restaurant pays a commission to the aggregation platform.
- Subscription
This model implies the availability of users’ subscriptions, which should be included in food delivery app development. When users sign up for them, they get access to special offers, free delivery, and other attractive offers.
- Fees during busy hours
One of the ways to earn even more money is by utilizing surge pricing during peak hours. This way, restaurants need to pay a higher commission to the application so that it can process their orders faster. As well, it is possible to charge customers an additional commission for faster delivery of orders.
- Paid advertising
One of the ways to earn a steady flow of revenue is to highlight some restaurants and their profiles in the app. Local restaurants can pay for ad placement on banners, among special recommendations, at the top of restaurant listings, etc. This type of revenue generation strategy is suitable for well-known services, so it makes sense to consider this model once your app has gained a user base.
In case you are wondering whether for you to create a food delivery project will pay off or not, just take a look at the below table showing some of the top examples of food delivery mobile app development that turned into successful applications with multi-million dollar yearly revenues like Uber Eats.
| Company | Annual revenue | Year of foundation |
|---|---|---|
| UberEats | $2.5 billion | 2014 |
| GrubHub | $1.4 billion | 2004 |
| DoorDash | $900 million | 2013 |
| Postmates | $550 million | 2011 |
| Glovo | $300 million | 2014 |
| Zomato | $206 million | 2008 |
| goPuff | $100 million | 2013 |
| Otlob | $11 million | 1999 |
Want to know about key ingredients that make an app successful?
Dive into reading the article How to Make your App Successful: A Detailed Step-by-Step Guide. You will learn how to start with an app concept and move on to an app with millions of users.
How to Start a Food Delivery App
Food delivery app development should begin with market research and the formation of a new app idea, continue with app strategy, design, and successful development. After you finish with food ordering app development, you will need to publish your app in app stores, work on its promotion, regularly check the main app metrics, and translate your findings into ongoing development and support.
Analyze the Market & Define Your TA
Before you start food delivery app development, you need to understand the local market, your key competitors, and define the target audience. Thorough market research will help you decide how to build a food delivery app:
- select the market where you want to launch the solution
- identify the most promising project concept (including app type, features, business model, etc.)
- find niches in the market that still have a place for new apps
- study the demographics and test your idea among the defined target audience
- decide on the best way to develop a food delivery app based on the collected data
Finalize Your Value Proposition
During this step, you need to identify your unique selling proposition – something that will help differentiate your future app from competitors. The application of the Business Model Canvas will help you structure all the necessary elements and evaluate all aspects of the food delivery industry.
Note: It might not be a good idea to create a clone of UberEats, as users won’t see any value in your proposition. Out of a few apps with the same features, users will choose the one with a big name. If you decide to clone UberEats, you will waste months of work, as certain competitors can push you out of business in a matter of a single feature update. You need to identify the main pain points of your users and offer them a unique solution with your app.
To structure your idea and create a food delivery with a unique value proposition, you can comprise a business model canvas. This term refers to a one-page summary covering the high-strategy details of how to get a product or business successfully to market - from the start, to the launch on the market. This business model consists of nine aspects that describe the main steps you should follow before introducing your application to the market.
The below business model canvas demonstrates how you can structure your ideas, create a unique value proposition, work on the business side of the project, take care of legal aspects, decide on your business model, etc.
Select a Reliable and Capable Software Development Company
After you have devised an idea for your app, you need to hire a company that will take on food delivery app design and development.
So, how to hire an app developer for the best outcome in food-delivery service creation?
First, you need to narrow down the region to which you can outsource food app development. These regions include Eastern Europe, Asia, South America, and Africa. Out of all of the options, Eastern Europe stands out, thanks especially to Ukraine.
Ukraine is a popular food delivery app development destination because of the high level of technical education, long history of development outsourcing, competitive prices, and taxation system.
The average price for food delivery app developers’ work is about $40 per hour, which allows you to hire the best team to work on your project and spend less on the development process. When compared to other countries, Ukraine has a great time zone.
If you outsource custom software development to this country, you can set tasks during your working day and the development team will work on them while you sleep, and can present results when you get back to work. At the same time, time zone overlaps give enough time for direct communication and discussions regarding your project.
Do you need a reliable company to create a food delivery project?
Get in touch with us to discuss your future project. Our experts will gladly provide you with the best approaches to on-demand food delivery app development and advise you on the best course of action.
Develop an Appealing Food Delivery Product
Once you have decided on the list of features to include, it’s time to move on to the stage where you develop the food delivery app. Usually, this stage is divided into the discovery and development substages.
The first one is dedicated to business analysis, UX/UI design research, and creation. The second stage is related to development tasks, during which your development team creates the front-end and back-end of your application, and performs testing and quality assurance services to ensure the flawless function of the app.
Apply Top Design Practices
Food delivery app design has a direct influence on the future popularity of an app. A good app design should be user-oriented, have a unique style, and look great on the screens of all mobile devices.
Ensure Flawless App Performance
The team creating a food delivery app should ensure the high quality of your app. One of the ways to guarantee high performance is by opting into native app development. Unlike hybrid app development, this type of app provides a better user experience, utilizes all the unique features of an operating system (iOS or Android), and ensures that users won’t have problems with its use.
Take Care of Proper Product Testing
After the app is ready, it’s time for the QA specialist to test the application on various devices and work through various possible user scenarios. The goal is to fix bugs before the app is released to end-users.
Do you want to know the process for hiring the best app development company?
Check out the article How to Hire a Development Team: Everything you Need to Know about the DDT Model. The article explains the basics of the dedicated development team model, locations to look for developers, and how to make the right choice.
Promote Your Food Delivery App
Food ordering app development cannot guarantee the popularity of your app. Today, you need to promote your users through different marketing channels to find and grow the number of dedicated users.
A possible marketing promotion plan can look like the following:
- Marketing campaign – create paid ads and launch them right after your app is released.
- Influencer marketing – get in touch with influencers and bloggers who will promote your app to their audience.
- SMM – engage in social marketing, as it’s one of the most effective ways to connect with potential customers.
- Partners – ask your partner restaurants to promote the app where customers can order food from their locations.
Food Delivery App Features
The features of food delivery apps are divided into three groups:
- Features for clients
- Features for couriers
- Features for admins
Let’s review the functionality of each group in more detail.
Client-Related Functionality to Develop Food Delivery App
You need to identify basic features for clients that should be created during food delivery app development. These features will make up a total MVP development cost. A food delivery customer app should include such core features as:
Registration – with verification via email, phone number, or social media. The option to register and sign in with social media (e.g. Facebook, Twitter, Instagram) is the quickest and easiest one.
Profile management – the ability to change core data, information used during registration, notification settings, etc.
Search – searching for restaurants and food categories. This can be combined with GPS for a better search based on user location.
Order placement – the creation of orders, changes, and cancellations.
Payments – the ability to pay for food and delivery inside the app. You should integrate the most popular payment systems in the region, like PayPal, credit cards, Apple Pay, Google Pay, etc.
Receipts – access to the list of ingredients in each meal offered.
Ratings & Reviews – an option to rate a restaurant, courier, and application.
Notifications – notify users about changes in delivery status with notifications.
Here are a few advanced features for food delivery app development that will help it stand out:
Bookmarks – functionality allowing users to add their favorite restaurants and meals to favorites for faster future searches
Order history – access to the whole order history within an app.
Delivery time estimation – show estimated delivery time based on user location, the distance to the restaurant, traffic jams, and other factors.
Loyalty programs – offer different loyalty programs and specials to dedicated users. The main goal of these features is to retain customers.
Social network integration – enable users to share their favorite restaurants and meals with other users.
Food Delivery App Development: Functionality for Courier App
Core functionality for building a food-delivery app:
Registration – provide a way to register an account using email, phone number, or other forms of authentication.
Profile management – enable the ability to change information in the user profile.
Order management – couriers should have access to the list of available orders with details like size, expected delivery time, pick-up and drop-off locations.
Status update - it is important to add statuses for orders like placed, accepted, canceled, and delivered orders.
Extra features to develop for a food delivery app like Uber Eats:
- Navigation – access to Google Maps or Apple Maps to help couriers find their way in unfamiliar locations.
- Delivery history – the whole list of fulfilled orders.
- Earnings – table showing earnings for each delivered order, earnings for a day, a month, or a year.
Features for Admin in Food Ordering App Development
The app for restaurants should include the following features:
Registration – ability to create an account for restaurants by providing the business details like a name, address, location, working hours, etc.
Profile management – functionality allowing changes to information used during registration, update operation hours, add new locations, etc.
Content management – provide features for restaurants to provide their menus, detailed meal descriptions with images and ingredients, pricing, promotions, and other information.
Order management – restaurants should have access to the list of incoming orders and their statuses. As well, they should be able to track the status of orders after a courier picks them up.
Payments – allows restaurants to accept payments, track their earnings per order, and total earning per day, month, year.
Tech Stack & Elements for Food Delivery App Development
As was already mentioned, food delivery application development is a complex process consisting of different stages.
In the table below, you can see the main integrations, tech stack, and components that should be included in food delivery app development.
| Technology stack | ||
|---|---|---|
| Android | iOS | |
| Programming languages | Java, Kotlin | Swift, Objective-C |
| Toolkit | Android Studio Android Developer Tools |
Apple Xcode |
| SDK | Android SDK | iOS SDK |
| Integrations | ||
|---|---|---|
| Service | APIs | Description |
| Mailing services | Gmail SendGrid ZeroBounce MailGun TempMail FastMail Firebase Cloud Messaging |
Mailing services that can be used for registrations and signups. |
| Push notifications | Twilio Nexmo Plivo Sinch Apple Push Notifications Service (APN) Firebase Cloud Messaging (FCM) |
Services that enable the sending of push notifications. |
| Social media | Twitter Snapchat Viber |
Integration with social media for fast registration, sign in, sharing, etc. |
| Navigation | Google Maps Google Directions Google Places API Apple Maps |
Features that allow to track orders, calculate the time of delivery, etc. |
| Payments | Stripe Braintree Google Pay Apple Pay PayPal’s SDK |
The most popular payment engines that allow paying for orders online. |
| Restaurants APIs | GrubHub Zomato Places |
These APIs allow you to obtain information about food chains and restaurants listings. |
Challenges in Developing a Food Delivery App
On-demand food delivery app development is a hard process that requires a complex approach. Creating an application is not enough. This sort of app should meet the needs of food providers and users, and ensure the timely delivery and reliability of your platform.
Creating a good digital product that will rival market leaders is not easy, but still possible. Below, you can find an overview of all of the challenges of food delivery app development and a short plan for how to overcome them.
1. Sustainability and scalability of food delivery app
Applications dedicated to food delivery are very complex. They perform a lot of tasks at once and operate with the help of multiple APIs including payment engines, GPS services, maps, etc.
Food delivery app features usually include not only functionality for end-users, but also features that are running in the back, like processing of transactions, personal data processing and storage, security issues, and much more. You should address these tasks before food delivery app development even starts.
Solution: These are all reasons why you should find an experienced food delivery app development company that will take care of the tech side and will create a user-friendly UX and UI, and ongoing app scalability and addition of new functionality.
Want to know why Google and Boeing outsource software development?
Check out the article Software Development: Reasons It Works, Models, & Top Locations to discover the main benefits. You will learn about the main models of IT outsourcing, the best destinations to outsource app development, and how to guarantee a smooth workflow.
2. High competition
The competition is quite tough on the market. You might not have UberEats in your region, but there is probably another name running the scene. Starting a local food delivery business is not that difficult. Scaling it to new cities or even countries is an entirely different story.
Solution: The best way to ensure the success of your application is to study the market upfront, pinpoint your main competitors, and analyze their unique selling propositions. You need to turn their weaknesses into your strengths by offering unique features combined with a great user experience.
3. Features for the first working app version
The main result of online food delivery is the first version of your application. The challenge is to create a full list of features for food delivery app development before the process starts, with the goal of avoiding spending any of your budget on a digital product that no one will use.
Solution: Based on the analysis of competitors and your unique idea, along with a reliable IT vendor, you need to create a full list of features for food delivery app development.
4. Searching for partners
Restaurants and food networks prefer to work with popular solutions, like UberEats, with millions of users. Big food chains might be hesitant about working with an unknown application.
Solution: Starting to collaborate with small local brands might be a good idea.
5. Searching for couriers
Hiring couriers for food delivery is challenging. They are the face of your business in the eyes of end-users.
Solution: For this reason, you need to dedicate some time to finding the right people and building a corporate culture.
6. Retaining users
Turning food delivery app development into a successful digital project is impossible without loyal clients. Therefore, you need to provide users with a reason to turn to your application every time they order food.
Solution: This goal requires the creation and implementation of a fully-fledged digital strategy. You need to utilize all the means possible, including digital and influencer marketing, advertising, coupons, special offers, and other activities that can help you retain customers.
Concluding Thoughts on How to Build an On-Demand Delivery Service
Food delivery app development consists of a number of stages and steps. You need to allocate the necessary budget for marketing and development and create a comprehensive strategy that will allow you to launch an app to the market and ensure its popularity.
So, let’s sum up the main steps of food delivery app development.
Step 1: Conduct thorough market research and identify your customer segments – users, restaurants, and couriers that will use your app.
Step 2: Define your unique proposition – what value you can offer to all segments of users and how you can solve their problems.
Step 3: Identify key food delivery app features – for end-users, restaurants, and couriers.
Step 4: Analyze and allocate resources to make a food delivery service – including expenses on development, promotion, etc.
Step 5: Find a reliable company providing food delivery app development services – a company with experience in the building of this type of apps.
Step 6: Create a financial plan – how you will generate revenue, measure achievement, and how long will it take to pay off initial investments.
You can mitigate the risks by starting with a simpler version of your app and testing the idea. The first app version should include only the core functionality. You will then further enrich this with additional features, turning it into a fully-fledged application.
Do you have a great idea for food ordering app development?
Get in touch with us. Our Business Analyst and Software Architect will consult you on food delivery app development and provide you with an initial estimate of your app development cost.
Frequently Asked Questions:
What is the forecast for the food delivery service market?
Businesswire predicts that the food delivery services market will grow by $104.45 billion by 2023. There is no surprise that on-demand food delivery apps are gaining popularity during the coronavirus crisis. Today is the best time to develop a food delivery app because of the promised high return on investment.
What are the most popular third party food delivery apps?
UberEats, GrubHub, and DoorDash are undoubtedly the most popular third party food delivery applications based on their annual revenue. These applications grab the biggest part of the market and together generate over seven billion dollars every year.
Who developed Gopuff?
MLSDev stands behind the development of Gopuff. Since the very beginning of its creation, our team has performed all of the development tasks and provides ongoing development and support. We went alongside our clients and witnessed the growth of the application from the app idea to being one of the most popular on-demand food delivery services in the USA.
How much time does it take to develop a food ordering and delivery app?
It takes around 3-6 months to develop the first version of such an application with a basic set of features. If you need to develop a food delivery app with additional features that are more complex in design, the timeline could be up to 6-9 months. For big applications with complex features and design, the timeline starts at 9 months and turns into ongoing development and support.