Food Delivery – A Fresh Perspective

About this white paper

This white paper has been created off the back of Post&Parcel Live: The Food Delivery Seminar, a one day event that takes place in London on 25th January 2018. We asked experts where they felt the food delivery industry was heading and published their thoughts in this white paper.

The Post&Parcel Live Seminars are intimate, one-day content and discussion led events for professionals involved in the post and parcel industry. The seminars feature keynote speeches from prominent experts, case studies from successful operators and open discussions with the audience and speakers. Find out more at www.postandparcel.live

Introduction to the white paper

Getting food delivered to your home used to be an insipid experience. You rummaged around the kitchen for those leaflets from the local eateries, took a family vote on “curry or pizza”, phoned through your order (after a long wait on hold), and then – after an even longer wait – your lukewarm meal would finally arrive. It was a world of limited choices, poor service and erratic ETAs.

How things have changed! There is now a much wider range of restaurants and retailers offering food-to-go to suit every budget and palate. And no more hanging on the telephone; you order online, either directly from the retailer/restaurant or through an aggregator like Just Eat. You don’t even have to make the short walk to your laptop – just use the app on your smartphone. What’s more, you can use apps to track your food’s journey to your door. Some apps can even be integrated with addressing systems so your food can be delivered wherever you happen to be – a leafy park, a sandy beach or a festival mosh pit.

This new world is made possible by a combination techno-wizardry at the back-end and an army of human helpers on the front line. But this human factor could be squeezed out of the equation, or at least reduced: we are now seeing glimpses of how technology could encroach further and become part of the physical delivery process, with drones, robots and autonomous vehicles.

Of course, the online food delivery menu is not restricted to restaurant-prepared meals. You can order “meal kits” from companies like Hello Fresh and all the major supermarkets and convenience chains now offer online food and grocery services. Indeed, food delivery is now a key part of their business. Over the 2017 Christmas season, for example, Sainsbury’s and Tesco both reported a significant boost to their food revenues, and their online food volumes in particular. Amazon, of course, also looms large with its Fresh and Prime Now offerings.

The food delivery market is worth billions and most retail analysts are convinced that it will be one of the fastest growing e-commerce sectors. Clearly, there is money to be made in food delivery, but the margins can be very tight – and in some cases even negative.

Retailers, restaurants and their delivery partners have all been experimenting with different models to make the process more efficient, and therefore profitable. We will continue to see more adjustments to the logistics of the supply chain. This could involve: finding new ways to recruit and reward the delivery staff; making vehicles more efficient and environmentally friendly; and offering customers more options like lockers/delivery box systems which can cut down on failed deliveries and speed up the process. There will also be more tweaking with the payment models. These could include a mix of subscription packages, offering free delivery for orders over a minimum spend, and premium charges for an extra fast delivery.

We need to think outside the box – and also think more about the box itself. There have been some major advances in food packaging. We now have containers that can keep hot, chilled and frozen food at their optimum temperature for many hours. Innovators like Lil Packaging have also developed “snug fit” solutions, which ensure that online food items can fit in parcel lockers or be delivered through a letterbox.

Finally, we need to reduce the amount of packaging used for food deliveries – and also make more of it recyclable or re-usable. Innovations in food delivery have brought much greater convenience and choice for the consumer, as well as exciting opportunities for food sellers and their delivery partners. Now we need to work together to control the commercial and environmental costs of this fast-growing industry.