Page 26 - FoodFocusThailand No.174 September 2020

SCOOP

Food Delivery Business

Expanding in Fierce Competition

after COVID-19…

Platform Providers Heading to

Super Application

The COVID-19 pandemic has urged Thai government to take an
extraordinarily protective measure to suppress the spread such as
a temporary shutdown, or a temporary suspense of the services
for some business sectors. Regarding to a restaurant business,
there were only choices of a take-away option, or a food delivery
to home via online applications. The food delivery service has
become an important sale channel for restaurant operators, and
a perfect choice for customers.

According to the information from online platform providers, there to enhance a customer’s need. Last but not least, they could design
were new sign-ups from small-to-medium restaurants averagely at the system to allow restaurants to compare the delivery costs, so the
20,000 stores per week. As 1 half of 2020 result, the orders of food restaurants and customers both have the visibility upfront.
st
delivery have grown up significantly around 150% compared to the same KResearch forecasts that the entry of new platform players will
nd
period of last year. For the 2 half of 2020, KResearch predicts that create a competitive awareness, and will affect the food delivery
there will be new online platform providers entering to the market. business in various dimensions as follows:
1. The food delivery trends and market competition will be • Forcing the current platform players to pay more attention
changed in many aspect dimensions on price promotions. This is to maintain their market share, and
When the usage of food delivery applications is continually to retain their competitiveness of platform providers.
increasing, the growth of this business sector still keeps on accelerating. After 1 wave of COVID-19 over, all restaurants are back in
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Therefore, the positive market condition has welcomed the new players operation as usual. Customers are more confident to have their meals
from both in/out of country. New comers might be from the same industry, inside the restaurants. Therefore, the numbers of online orders are
or they might come across from a different business sector. A new player going to decline. The extraction of demand will urge the platform
can introduce new benefits or different business models. For instance, providers to invest more to secure their market share of current
they can remove all service fee to restaurants which the current players customers, or to gain new users. Besides, they may stimulate more
are charging by Gross-Profit-Margin (GP) up to 35% of sales with terms co-marketing campaign with restaurants to build more promotions.
and conditions. In addition, they could speed their term of payment to • Increasing the competition in food business. New entry of
restaurants faster. Likewise, they could improve their online application platform providers will help to expand the sale channels to

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