Startups Haven’t Replaced India’s 19th Century Food Delivery Service
More than 400 food delivery apps started up in India over the past three years, raising $120 million from venture capital firms and other investors. Luring customers with photos of tasty curries along with discounts and free delivery, they sought to disrupt the delivery networks that have existed in India since the 1890s, including Mumbai’s famously low-tech dabbawalas, who ferry 175,000 meals—some from cooks’ homes, others from central kitchens—to office workers and students daily. The time-tested deliverymen carry boxes via trains, bicycles, and pushcarts to their hungry clients, using a system of alphanumeric codes printed on reusable containers.
The new services offered something dabbawalas don’t: last-minute ordering and the ability to choose dishes from hundreds of restaurants. Dabbawalas require a monthly commitment, and customers are locked into a meal plan for the entire period. Even so, most of the high-tech startups have foundered, and dozens have closed. The ones that are surviving, including TinyOwl and Foodpanda Hellofood’s India unit, are shrunken versions of their former selves. “The story was glorious when they had lots of money in the bank, but they went madly after customer growth and spent it quickly,” says Anil Joshi, an investor and founder of Unicorn India Ventures in Mumbai, who didn’t invest in food delivery companies.
Meanwhile, the dabbawalas appear to be busier than ever. While they have no apps, they’ve managed to retain market share. And they’re jumping on the e-commerce bandwagon themselves—by lending delivery staff to companies such as giant e-tailer Flipkart and offering training programs for new tech-enabled merchandise delivery startups such as Roadrunnr. Read More…