Amazon’s Food Delivery Launching This Diwali; Rs 3500 Cr Warchest To Beat Swiggy, Zomato!
And now, the final battle lines are being drawn in the food delivery business.
Amazon, the world’s biggest ecommerce portal is all set to enter the cut-throat race of food delivery niche, and take on the existing biggies Zomato, Swiggy and Uber Eats heads-on.
Rs 3500 crore warchest has been created by Amazon to fight off its rival in this new business segment.
Will Amazon India win?
Amazon’s Food Delivery Launching This Diwali?
As per an exclusive report by MoneyControl, Amazon India is all set to launch their food delivery business this Diwali.
Their aim is to disrupt the business, and gain maximum market share.
Rs 3500 crore warchest has been created to unleash offers and discounts as well.
A senior Amazon executive said, “We have disrupted every business we have entered, be it ecommerce, payments or entertainment,”
Amazon’s Food Delivery: How Will It Work?
In a rather curious move, Amazon will charge 25% commission from their restaurant partners, which is unexpected. Swiggy, Uber Eats and Zomato, they charge 20% as an average commission from the restaurants for each order.
However, the advantage which Amazon has is their super fast delivery service.
Some analysts are predicting that Amazon will deploy their advanced predictive technology for delivering food orders, and use their existing fleet of delivery agents to fulfil food delivery orders.
This can be the game changer.
Besides, Amazon’s food delivery service will tie up with delivery-only restaurants and cloud kitchens, which do not serve customers at their locations.
Will it be a smart move?
Amazon vs Zomato, Swiggy and Uber Eats?
RIght now, Zomato is the #2 player in food delivery business, with 214 million orders worth $821 million in the first six months of FY20.
Swiggy is at #1, with an average of 3 million orders per day or 500 million in 6 months. (estimation by Redseer Research)
UberEats and Ola’s FoodPanda are minor players, but catching up in urban locations.
Swiggy is valued at $3.3 billion, and have raised $1.3 billion so far.
Zomato is valued at $2 billion, and has raised $750 million so far.
It would be interesting to observe how Amazon funds its food delivery business, and what strategies will it employ, to become #1 player.