Groceries, food, services and the like, we customers can have anything delivered at our doorsteps. We already know that the meal delivery service is growing consistently and it is bringing success to a plethora of new online ventures. Entering the market is not easy if you don’t have sufficient knowledge about the development of an application like postmates and certain marketing strategies to implement. For food delivery app development, one needs to pay attention to various things which include evaluation of ideas, market research, and analysis, hot trends, finding unique features to integrate, etc.
Business models to choose for on-demand food delivery app:
There are 4 types of models that an entrepreneur can choose according to the facilities available. These models are crafted to reduce the usage of unnecessary resources and increase revenue. Satisfy your financial goal by choosing one of the following models.
Order the only model: In this type of business model, the person only needs to take the orders from the customers and pass it on to restaurants with which he has collaborated with. The restaurant then prepares the food and delivers it to the respective locations. The delivery drivers belong to the restaurants themselves. This model is usually chosen by those people who don’t want to establish a whole business model and just want it as a side business.
Order and delivery model: It is a kind of extended version of the order-only model where the owner takes care of the logistics and this way, both restaurants, and owners are benefitted. Uber, Zomato, and Doordash like organizations are following this model. To build this kind of platform, you need to create a platform and find those restaurants that don’t have their delivery services and can collaborate with you so that you both can grow together.
Cloud restaurant model: It is the most efficient way of starting a food delivery service where the owner doesn’t need to have a separate restaurant. You just need a platform from where you can receive the orders, once received, they can deliver the food through their own drivers. The organizations which are following the cloud kitchen model, are raising millions of dollars in the initial stages as it needs a small amount of investment.
Meal-kit delivery model: This is a little unusual but entrepreneurs are using this business model to deliver nutritious ingredients to customer’s doorsteps for preparing a delicious meal. This model is receiving high traction from the customers who would like to receive cooking instructions along with the ingredients.
Entrepreneurs need to select one of the above business models to stand ahead of the competition. If the owner is not having much space to open up the dine-in area, he can opt for an order-only model, and similarly, the choice should be made according to the needs.
The revenue model of Postmates like the app:
Delivery Fee Model: Postmates usually charge a certain amount of fee once the order is delivered. The owner can also decide a percentage of the amount which needs to be collected from the customers. A certain amount of money goes directly to the owner.
Subscription model: Subscription is usually given to the customers where they receive certain offers and discounts. Sometimes, they receive free deliveries as well. Through this model, various organizations earn millions because it gives benefits to the customers and money to the owners.
Surge pricing: Sometimes due to heavy rains or more demand, there is a surge in prices. The additional amount charged from the customers goes to the pocket of the owner. Organizations usually follow this model to increase the revenue manifold.
Commissions: The orders placed through customers give the commission to the owners. The amount is always decided by the owner. This model is followed by every organization so that they can earn millions with the help of orders.
These are some of the models through which the owners receive revenue. To build an application like postmates, one needs to consider these revenue models and work according to them.
Main challenges to overcome while working in the market:
Researching the market: To analyze the current situation of the market, entrepreneurs need to try the applications of their competitors so that they can easily pick out the problems and include the solutions in their application. Researching the market is essential no matter what size your platform is. After choosing the business model, one should target the audience to target. It is advised to target a small number of people in the beginning. Once a strong customer base is created, then one can expand and include other people as well.
What is the strategy for targeting people?
Some top organizations like Uber eat and Instacart, target busy individuals who work on a daily basis because after a hectic day, some don’t want to cook instead, they like to order food and groceries online which can be delivered at their doorsteps the same day. This is the strategy of organizations to cover more individuals.
If we talk about Uber Eats and Postmates, both follow the same strategy and cover the same audience. Postmates also deliver groceries which makes it even more valuable to customers. A constant supply of food and groceries is guaranteed by both business models which keeps them running.
Collaborating with the restaurants nearby: The next challenge which comes in front of the entrepreneurs is collaborating with the restaurants. If they have logistics service, they need to look up a kitchen for which they need to contact restaurants in the area where they want to carry out the operations. For groceries, the owners can directly contact the local farms and for food, restaurants can be contacted. Companies like Zomato and Grubhub, have partnerships with the local restaurants which take the commission for their sales and perform the deliveries themselves.
The major question that arises here is how do they manage everything?
Normally, the entrepreneur offers a separate application for the restaurant through which they can manage everything efficiently. Through an application, they can accept or reject requests, edit menus, etc. An integrated geo location feature can also be added to track down the location of the drivers working with the company.
Arranging Logistics: Logistics is an important part of any food or grocery delivery service business. This is yet another challenge that is faced by entrepreneurs as there is a dilemma in front of them. They can either hire drivers on payroll or contact freelancers. A person with a vehicle and willing to work after their shift is a potential worker. Some companies choose to hire their own drivers because the only disadvantage of having a freelancer is inconsistency. Drivers on the payroll are always on time and the entrepreneur is sure of the fulfillment of every delivery on time.
A separate application is made for the drivers as well where they can update the delivery or can turn on the application when they are available so that they can receive the orders to fulfill. The owner should also provide certain assistance like vehicle insurance or life insurance because accidents are common nowadays. Drivers should be safe and secure while delivering items to customers.
App development: Development and designing of the application is another challenge for the owners. There are usually separate applications for customers, drivers, restaurants, and admin. Every section has certain basic and advanced features for customer convenience.
- Registration and login
- Card details
- Multiple online payment methods
- Delivery status
- Order history
- Push notifications
- Rate and review
- Discounts and offers
- Accept or reject incoming orders
- Push notifications
- Order placement
- Payment menu
- Ratings and reviews
- Update completion of orders
- Update profile and registration
- Booking the order
- Booking history
- Push notifications
- Update delivery status
- View earnings
- Profile and registration
- Reports and analytics
- Restaurant management
- Content management
- Statistical report
- Multi-payment option
- Multilingual capabilities
These are some of the basic features of a food delivery application. If needed, entrepreneurs can also add some unique advanced features which make the application more interactive. It is always advised to include basic and advanced features to make it easy-to-use.
What is the final cost of developing an app like Postmates?
Overall, the cost of developing an app like postmates lies somewhere between $7k to $20k depending upon various factors. Software development consists of various components like the front end, back end development, UI/UX design, development of separate panels, etc. Let us see what all factors are responsible for deciding the cost:
(Note: Price to develop an application fluctuates from time to time according to the on-going offers and discounts. Contact us to know the best possible cost for building a feature-enriched app.)
Geographical location: Company’s geographical location is a deciding factor of cost because, in some locations like China and India, the application can be developed at cheap prices, and in some places like California and other American states, the app development cost is high. So, it is very important to choose the location wisely.
Features and functionalities: There are basic and advanced features to be added to an application. If you want only the basic features, the cost will be less and if you would like to add advanced features using the latest technologies, the cost will be high. It is very important to include as many features as you can to make it more functional and easy-to-use.
Way of developing an application: Usually, an application can be developed in two different ways. You can build it from scratch or you can purchase a clone app from the market and customize it according to your business needs and requirements. An app built from scratch is costlier than just customizing a clone app but it is worth it because one can include the features according to their own needs.
A number of platforms: The applications are launched on many platforms like Android, IOS, and the web. More number of platforms means more money involved. It is advised to launch the app on every possible platform to reach more people in a short period of time.
UI/UX design: Designs and templates should be chosen very carefully because the frontage and other landing pages can easily attract a large number of people if it is looking attractive.
All in all, we can say that food delivery service businesses are flourishing and new entrepreneurs are trying their luck by building a feature-enriched platform to serve their customers in a tasty way. So, if you are looking to build one, you can contact Suffescom Solutions which has an experienced team of developers and designers to take care of your needs and requirements.