Ro­bust growth in food de­liv­ery rev­enue

Singapore Business Review - - ANALYSIS: FOOD DELIVERY SERVICES -

Sin­ga­pore’s food de­liv­ery in­dus­try is in for a de­lec­ta­ble growth pro­jec­tion in the next five years. Ac­cord­ing to this graph from Statista, the in­dus­try’s rev­enue’s an­nual growth rate from 2017 to 2021 could reach 25.9%, re­sult­ing in a mar­ket vol­ume of US$480M in 2021. On­line take­away is its largest seg­ment, with a mar­ket vol­ume of US$182M in 2017. The av­er­age rev­enue per use un­der this seg­ment is US$344.7 this year and is ex­pected to climb to US$376.5 in 2021.

Sin­ga­pore Man­age­ment Univer­sity as­so­ci­ate pro­fes­sor of mar­ket­ing ed­u­ca­tion Se­shan Ra­maswami says the growth of the food de­liv­ery mar­ket the food de­liv­ery busi­ness is a con­se­quence of the con­flu­ence of two in­de­pen­dent phe­nom­ena – Sin­ga­pore­ans’ con­tin­u­ing ob­ses­sion with food and fas­ci­na­tion with tech­nol­ogy. More so, he stressed that de­mand for the ser­vice will al­ways be there, and firms which are able to fig­ure out lo­gis­tics and order­ing porcess will be sus­tain­able.

“In terms of con­se­quences for the F&B sec­tor, ev­ery op­er­a­tor now needs to be able to think be­yond the walk-in cus­tomer and re­al­ize that they now have easy ac­cess to a Sin­ga­pore-wide plat­form. This could have an im­pact on their menu as­sort­ment, on their pro­mo­tions, and on their op­er­a­tions – as they are also now com­pet­ing not just lo­cally but Sin­ga­pore-wide,” he adds.

For a busi­ness to thrive in this boom­ing in­dus­try, Ram­swami says it has to clearly de­fine its fo­cus in terms of its cho­sen mar­ket, as­sort­ment of restau­rants, pric­ing, and de­liv­ery times. “In forth­com­ing years, I sus­pect that an even larger pro­por­tion of F&B op­er­a­tors, from the small mom-and­pop hawker cen­tre or in­de­pen­dent café op­er­a­tor to the large chains will be of­fer­ing de­liv­ery ser­vices across the is­land.”

Rev­enue in the food de­liv­ery seg­ment

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