How food delivery platforms enable tier II & III restaurateurs
on food-delivery platforms. Six years since, she is rolling in dough. The 33-year-old entrepreneur who lives with her husband and two kids says her family was able to purchase a house and upgrade from a two-wheeler to a car after signing up with a food-delivery platform which helped boost sales to ₹4 lakh per month.
The apps today contributes up to 90% of her sales. Kochi-based Mysore Raman Idli which relied on word-of-mouth publicity in its initial days has seen its average monthly order volume gallop to 3,780 from 780 in a span of two years after it partnered with food-delivery platforms. The restaurant claims to have seen a 7x growth in repeat customers and has seen a revenue growth of around 60% during this period.
Bonfire Pizza and Mysore Raman Idli are among thousands of restaurants in India’s tier II and III cities which have turned their fortunes around by partnering with food-delivery startups Swiggy and Zomato. They don’t mind spending 30-35% in commissions as these platforms enable better discovery and give them a head start in their business without investing in promotions and delivery fleets. With overall growth plateauing in the world’s most populous country with a restaurant market worth $70 billion out of which $43 billion is delivery, food-tech startups are betting on tier II and III cities to sustain momentum.
Over the last two years, Swiggy and Zomato have rolled out several initiatives to promote small F&B entrepreneurs while restaurants have availed incentives such as zero-commission for a fixed tenure. Within the app, there are also provisions to boost their visibility during certain festivities. The tier II and III segments are likely to become the next levers of revenue focus for online food tech
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