The number of food takeaway and home deliveries have been increasing quickly in recent years in the UK, with 7.5 billion deliveries being made in 2019.
As to be expected, these services benefited greatly from COVID-19-related restrictions while the population was in lockdown for several months in 2020. Even when restaurants began opening up again, the fear of the virus kept many people away, still continuing to opt for home deliveries instead.
Even before the pandemic, food delivery platforms were gaining popularity; over the last three years, there has been a 39% increase in food deliveries in the UK. They offer customers more convenience, greater ease with ordering online or via an app, and there are greater options of food to choose from, all at your fingertips.
Thanks to the accessibility of third-party platforms, the number of meals sold by both chain and independent restaurants increased in the UK in 2019.
London alone saw a 4% increase, with roughly 606,000 extra meals sold from chain restaurants and roughly 305,000 extra from independent restaurants, as was divulged in a 2019 growth report by Deloitte.
In total in the UK, 1.6 million meals were sold each week through third-party platforms. It is clear that restaurants have recognised a shift in customer preferences and been able to meet this demand and benefit by signing up to third-party platforms.
While there are many available platforms, here is an overview of the most popular food delivery platforms in the UK:
Founded in Denmark in 2001, Just Eat has grown exponentially. It was rated the most popular food delivery app in the UK in 2019 and works with over 100 cuisines.
The app offers a sophisticated platform to its Restaurant Partners, providing them with access to data and insights in order to help them optimise their operations and continuously improve the service, as well as taking control of marketing for the partners. On average, restaurants using Just Eat delivery services place 4000 orders a year.
Furthermore, Just Eat positions itself as a tech expert, having created a Tech Hub full of articles and resources on all topics relating to app development, UX, data engineering and like.
Founded in the UK in 2017, Food Hub is more local and focuses mainly on delivery food within the UK. Operating differently from other competitors, there is no commision fee and restaurants need only pay a fixed weekly price. In addition, there is no service fee meaning customers pay on average 15% less when they order food through Food Hub.
Optimising the user experience, restaurants are able to have their own landing pages so customers do not have to filter through long listings of restaurant options.
Founded in the UK in 2013, Deliveroo now operates in 100 cities and towns in the UK, as well as 200 locations internationally. Deliveroo is one of the most widespread food delivery apps available, with around 80 000 restaurants and more than 6 millions users globally.
Around 15 000 riders are employed in the UK alone, who are able to work under flexible conditions. The machine learning features of the app provide more accurate timings for prep time, therefore riders are able to save time as well as deliver quicker.
They charge a commission fee of around 10%-20%, but additionally offer their partner restaurants data insights and help them expand to other areas without any upfront costs that a high-street premise would require.
Launched in California, US in 2014, UberEats has the added benefit of being affiliated with the already existing taxi service. The app has 21 million monthly users globally and supports 500 000 restaurants globally.
That being said, the food delivery part of the business has supposedly been slow to make a profit, even though they take a 30% cut from orders.
This is likely to be because they partner with lower budget establishments such as McDonalds.Furthermore, the delivery fee in the UK and Ireland is also based on the value of the order. According to Wired, 60% of UK deliveries in 2019 were from McDonalds.
Innovation in the food sector
In addition to these platforms, online-only brands that provide ingredients allowing customers to cook their own food are also growing in popularity.
These tend to work on a subscription basis, with one recipe box automatically being delivered each week, featuring different ingredients every time.
Another trend that is beginning to be seen is the adoption of online-only, virtual restaurants, also known as dark restaurants, ghost kitchens or cloud kitchens. This is made possible by carrying out advanced food preparation at strategically placed kitchens at underused real estate locations, without offering any physical restaurant.
Many brands are working from shared kitchen spaces that operate in a similar way to coworking spaces, where a monthly membership fee is charged to rent kitchen spaces to different food businesses, including back-of-house services such as dishwashing.
On top of this, they provide support with access to technology for the businesses to process their online orders and make use of delivery apps. This way of operating cuts labour costs and also means a more efficient service can be provided, with advanced preparation allowing for a quicker cooking time, faster deliveries and subsequently hotter and fresher meals.
Deliveroo is one platform that has quietly been making use of virtual kitchens since 2017, and as of 2019, are supporting 2000 virtual restaurant brands across the UK. They have also recorded a 220% increase in orders from virtual brands since January 2020.
Data from Uber Eats also shows that existing brands that have opened up cloud kitchens have seen a 50% increase in sales in the UK. As other third-party platforms are gaining awareness of the potential of cloud kitchens, they are beginning to use data insights to identify opportunities for existing brands to open up cloud kitchens in certain locations to be able to expand to other regions.
Delivery-only kitchens naturally rely heavily on the transport infrastructure provided by the delivery services of platforms such as the above mentioned, as well as online platforms such as Jumpseller to host their online store.
Having a strong online store is essential for the business to work, and through Jumpseller, delivery-only brands have the ability to take orders online or via Whatsapp, as well as receive support with social media marketing to drive awareness and engagement for the brand.
It is possible to integrate different payment methods as well as a built in translation system, and most importantly to partner with popular delivery services to deliver the food to your customers.