How Online Food Delivery Apps Make Money? (2024)

How online food delivery apps make money?

The on-demand food delivery business is popular for quite a long time now. During this COVID 19 period, it becomes a boon for the food services providers. Pandemic conditions changed the way of doing the business, customers start placing orders from their homes or from the way for pickup.

It looks online food delivery marketplace business only earns through commissions on the successful delivery of food orders to the customers. But in a true sense it is not true there are multiple ways through which any food delivery business can earn revenue from their restaurant businesses.

Either you are already into the food delivery business or planning to launch one this article will explain how an online food delivery business makes money in this business industry.

How online food delivery marketplace apps make money?

There are numerous ways by which online food delivery marketplace businesses can make profits or revenue for their business from the white label food delivery marketplace platform.

• Commission on food orders – As a platform owner of food delivery marketplace apps, you can charge a fixed commission in the way of a fixed amount or percentage on each order placed on your platform. You can assign or negotiate different commissions with different restaurants to provide your platform for free but to take out platform cost you will take a commission on each order to make your revenue from the food delivery services.
  
• Presenting restaurant on your platform – Restaurant spent a lot on advertising their restaurant food menu everywhere. As a platform owner, you charge them to list restaurant listing on prominent places to advertise their brands on your web & smartphone platform.
  
• Delivery charges – Some restaurant businesses do not want to hire their delivery staff. They want to use your delivery staff for their deliveries and they will pay delivery charges to you. You can hire your own delivery staff and do deliveries and charge delivery charges per order from restaurants.
  
• Convenience charge – Not only restaurant business but you can charge your platform users who place orders on your online delivery marketplace platform with the convenience charge. Although this convenience charge is a small amount per order. users happily pay them as they are using your platform without a need to go out from their residence or office.
  
• Payment gateway charges – You can negotiate with payment gateway companies about the charges they charge on online payments. Because you are a platform owner you have a large number of daily transactions they will offer you the best transaction fee and you can charge above that transaction fee from your restaurant businesses.
  
• Subscription earning opportunity – As an owner of Ready On-Demand Food Delivery Marketplace solutions, you will have two subscription-based earning models. You can make different plans for a restaurant business to limit the number of the food menu, the number of food orders, placements, featured listings, separate branding assets like mobile apps, social media marketing, etc. For users, you can provide them different plans for discounts, monthly subscriptions for earning reward points, etc. And charge them monthly, quarterly, half-yearly & annually.
  
• Advertising third-party related services on the platform – Due to massive exposure to your traffic on your platform you have an opportunity to charge premium advertisem*nt costs from related businesses to place their banners or listings on your web & app platforms.
  
• Service-based pricing to the restaurant business – Each restaurant business has its own requirements for doing the business. Some restaurant businesses are okay to handle incoming orders from web-based software where some like to have a separate mobile app to manage orders more efficiently. Some want to have thermal printers to print order receipts some easily manage through the app only. Some restaurant businesses want to have their own separate customer mobile app. You can charge them differently for these different additional services.
  
• Hardware selling to the restaurant business – To run business digitally every restaurant owner need some sort of related hardware like the Android tablet for order processing, Thermal printers for order receipt printing, Point of sale systems, inventory management software, large display units for orders in the kitchen, etc. You can have to tie up with vendors of these companies and provide hardware to restaurant businesses at reasonable prices.
  
• Marketing Campaigns – You can offer different plans for marketing campaigns to the restaurant business. Due to the nature of the restaurant business, restaurant owners don’t have enough time to do social media marketing or email marketing. You can provide them different plans for that and market their business to get more customers & orders to their business.
  
• Text / SMS Marketing – As you have good numbers of restaurant clients and have the bandwidth to purchase large quantities of text or SMS services from any good provider. You can sell these credits to the restaurant business at reasonable pricing to promote their business.

Solutions needed to Start a food delivery marketplace business as following:

• Web Portal for Multi Restaurant Marketplace
• Separate Web Backend for Restaurant Business
• Master Admin Web backend to manage full platform
• Delivery Management Web Console to Manage delivery boys, tracking, etc.
• Customer Mobile apps (Multi Restaurant marketplace)
• Restaurant Staff App to manage orders on the go
• Delivery boy apps

There are two ways to start your own food delivery business.

1. Invest $10000 – $20000 in custom development of applications needed in marketplace business and wait for 5 – 6 months to get the products in place then invest in marketing to launch your business.
   
2. Or, Take Ready On-Demand Food Delivery Marketplace solutions from foodappsco (Unit of Fablian Technolab) just for $1999 to start your business, take your market depth and launch your business within few days of time.

Conclusion

As you see it is not only about the commission on orders but you have different ways to earn revenues in the Online food delivery services. Customers love to place orders online nowadays because they don’t want to go outside or want to place orders on their way to the home for pickups. It’s a good business model if you are planning to start your own.