Ever since Postmates become the fastest way to send anything from point A to point B, the on demand delivery app like Postmates, Jinn, and Quiqup has begun to grow with crazy pace.
In one of our recent articles – The Best Go-To-Market Strategy To Build On Demand Services App For Multiple Industries And Make Millions! – we talked about how targeting multiple industries through an on-demand delivery app can get you ahead of competitors.
In fact, Jinn is doing the same thing, by letting its users in Europe order anything locally for delivery – not just food.
Founded in 2013, Jinn has successfully picked up $10 million in fundings recently, with the total funding of $20 million till now.
The startup is currently handling deliveries by hiring freelance couriers and generating revenue through the £5.95 flat delivery fee plus charging 10% of the purchase.
Similar to Jinn, another London-based on demand delivery app startup Quiqup has also raised £20 million in Series B funding.
Originally, the aim of Quiqup was to let customers order anything from its app for local same-hour delivery, with initial emphasis on food. However, with new fundings, the startup says it plans to use the capital to expand to other U.K. cities beyond London and also start international expansion.
Another Malaysia based Food Delivery Startup – Dahmakan, has raised funding of $2.6M as it prepares to grow its business in Southeast Asia.
The food delivery startup differentiates itself from the industry giants FoodPanda and Deliveroo with an end-to-end access to food, saying that it cooks all of the dishes by itself and delivers to its end customers. Moreover, Dahmakan also considers its food as healthy comparatively with junk food.
2017 was a tremendous year for the Malaysia based food startup as it boosted around $1.3M in Feb and also became the first Malaysian startup to be included as a part of YC’s summer 2017 program.
Jessica Li – One of the co-founders of Dahmakan, revealed that the fund will be utilized for expanding technology and searching new opportunities to grow the business into Southeast Asia region.
The point of sharing this information is this: Today, time is a precious commodity for people. As customer expectations change, retailers of all sizes will be expected to offer flexible efficient and affordable delivery services.
Therefore, creating a platform that let users order anything locally with same-hour delivery guarantee with your on demand delivery app can get you one step closer to launching a successful startup in the on demand economy.
In fact, we have personally developed a similar app called Ninja Delivery. It is an on demand delivery app, serving in California, to send any kind of packages from point A to point B.
As you can see, there is clearly a need for these kind of on demand delivery apps, and startups like Postmates and UberRush are leading the industry at the moment.
So, What exactly made them successful and popular?
Or, What do these on demand delivery app startups target?
Originally, Postmates started out as a food delivery app startup, similar to UberEats. But, Postmates has identified the opportunity and widened their reach by offering to deliver anything, not just food.
In fact, Postmates today get some orders that are really small: a dishwasher liquid or a bar of soap. But, these small orders are what keeps Postmates running, as they guarantee a constant supply of orders for their couriers.
To build an on demand delivery app like Postmates, you’ve to take care of certain things. They are as follow:
As mentioned earlier that time is precious commodity for today’s consumers, you’ve to find and partner with local stores in your region to display products in your mobile app.
For example, you’ll have to contact and make deals with restaurants, grocery stores, health & beauty businesses, cafes, etc in order to offer products in your app.
On top of this, you must also provide an option to let customers write down their desired product, if it’s not available in the display, to order.
There are two primary ways that on demand startups find couriers.
-They hire their own fleet of couriers.
-They contract with freelancers the way Uber and Ninja Delivery does.
The Uber like method is much more common in most on demand delivery startups, but depending on the size and location of the market, you’ve to decide this.
However, when starting out, working with freelancers is cheaper for on demand delivery startups. And, for any recently launched delivery startup, having their own fleet of couriers often seems like too much expense and commitment, but it’s recommended to hire a certain number of full-time couriers once the startup reaches a stable level of orders.
The majority of on demand delivery startups have separate apps for couriers/drivers and customers. We analyzed the most successful on demand delivery startups on the market and created two templates that include essential features that a customer app and courier/driver app must have.
In fact, when the client of Ninja Delivery App approached us, he also wanted to build just one app for both users, at first. But, after understanding the downsides of that, he agreed with us and decided to create separate app for both its users.
The courier/driver version of app is simpler and only has handful of only essential features.
Now of course, it will take time and effort, but focusing on the most essential features in your app will certainly put your app ahead of your competitors.
Postmates does it three ways: courier fee, retailer program, and convenience fee.
Courier fee include a small reward for every order you make; convenience fee is extra price satisfied customers agree to pay (probably between 5-10% of whole sum), and when it comes to retailer program, according to the agreement partners sign, they allow postmates to take 15-30% of their revenue in return for noticeable placement in the app.
Other on demand app services generate revenue in a similar way. For newly launched on demand startups, it’s best to charge 5% convenience fee and $5 courier fee that directly goes in the pocket of freelancers.
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