App Development

A Guide On The Different Sources Of Revenue Of The Food Delivery Business

Hi there! In the present circumstances, delivery apps are the talk of the town. Over the past year, delivery apps are experiencing traffic like never before due to the pandemic. As people are tied to their confines due to strict lockdown restrictions, the only way to buy their essentials is online shopping. Nowadays, even small shops and restaurants have started to roll out their digital presence by implementing their own app or aggregating with delivery platforms.

There are enough blogs that circulate over starting a food delivery business and how to reap the profits. This blog slightly deviates from the rest of the educational blogs on the food delivery business by letting you know the different sources of monetization. Of course, this blog will also include the subtopic on food delivery app development. Let us get in!

What are the different money-making sources of food delivery platforms?

It is a known fact that the food delivery platforms gain stellar profits in comparison to the individual restaurants. So, let us know how these food ordering platforms make money meanwhile gaining popularity.

Hefty revenue from commissions

If you start a food ordering aggregator platform, your major source of revenue will come from the commission charges. Restaurants who get orders through your platform will pay you commission charges that you fix. You can fix different percentages of commission charges for different restaurants. It totally depends on you and the popularity of your food delivery platform. 

Meanwhile, you have to keep in mind that charges exorbitant commission charges will force restaurants to leave your app. The more restaurants you have on your platform, the more will be the number of users. So, while fixing the commission charges you have to be a bit cautious. 

Revenue from delivery charges

Next to commission charges, your food ordering business guarantees revenue from delivery charges. There are restaurants that depend on food delivery platforms in addition to their delivery persons. Another case is where restaurants completely depend on food delivery platforms to handle the deliveries. Be it any of these cases; you will employ delivery agents, and deliver the orders to the customers. You can waive delivery charges from your customers, which should be nominal. Here is a thing! Most of the food ordering platforms increase their delivery charges during peak hours. While placing the orders, the app will notify the customers regarding the extra delivery charges in busy hours. So, it is good to practice the same in your business as it is one of the ways to build transparency.

Transaction fees

Since most of the customers will prefer online payments, you can add transaction fees for every payment. Also, here comes the need to highlight the benefits of integrating diverse payment options in your food ordering platform. There are two types of benefits associated with having a range of payment modes. Firstly, you can encourage your customers to make online payments and at the same time, they can choose a convenient mode of payment. Secondly, the more the number of payment modes, the more will be the revenue from transaction fees.

Subscription-based charges

Another major revenue stream of food delivery platforms is subscriptions. You can charge subscriptions from both the restaurant partners and from the customers. Here is how the subscription plan works. First, let us take a look at the subscription plans of restaurant partners. Restaurants will pay subscriptions for featuring their ads, menu, delivery, etc. Whereas, customers can opt for subscriptions for availing discounts on orders. You can split the subscription plan into quarterly, half-yearly, and annually.

Advertising

Since yours is going to be a restaurant aggregator, you can fetch hefty revenue from advertisements. Firstly, restaurants listed on your platform will opt for featuring their restaurant in order to compete with other restaurants. This is one case. Here is another! Apart from restaurants, third-party services will also prefer to advertise on food delivery platforms. The third-party services can be a digital payment platform or any other business. On the whole, advertising on your platform is again a guaranteed source of revenue.

Voila! We have discussed the various revenue streams that are associated with the food delivery platform. You will now know the food delivery app development in detail.

Advantages of investing in ready-made food delivery app solutions

At present, entrepreneurs opt for ready-made apps rather than hiring a team of in-house developers. The highlights advantages of buying ready-made apps are time-efficient and pocket-friendly than custom app development. If you wish to invest in a ready-made food delivery app then you must choose the UberEats like app development

Final thoughts

If you are about to become the owner of the food delivery platform, then you can launch a food ordering app like UberEats. I highly believe that this blog on the different revenue sources will be informative for you.

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