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Would Upcoming Hyperlocal Delivery Companies Pose a Risk to Zomato and Swiggy?

Are you wondering about the time when you had to place an order via a phone call to a restaurant? It was time consuming, confusing and you had no clue about the real-time status of your order. There was one company that took note of this and started to cater to this problem. They started out as an online food review platform and ultimately went on to food delivery. We’re talking about none other than Zomato, and replicating this business model, Swiggy. Both these companies revolutionised the way we bought food and the increase in cloud kitchens, accelerated the push towards online ordering and the growth of these two giants. However, in recent times, new players have emerged in the market who have taken note and are offering more. So, who are they?

We’re talking about hyperlocal supply chain delivery companies that have changed the landscape of logistics forever. Hyperlocal delivery refers to the process of delivering goods directly from a seller to the customer. It involves the operation of a courier agent picking up products from a seller and then delivering them directly to the customer’s address. It is carried out in a small geographical area, and deliveries are usually completed within a few minutes. Some of the companies that are gaining traction in this industry are Dunzo, WeFast, Zepto, Grab and Shadowbox. Gone are the days when one would have to wonder how to transport things within the city limits.

A man delivering goods on a scooter.

The hyperlocal delivery model has helped the logistics industry to optimise time, cost, and resources. It has resulted in fewer delivery resources required since time gets saved on short distances travelled, and sellers can cater to more customers. Moreover, with aggregators offering nominal prices based on shipment weight, small sellers need not invest enormous amounts of money on shipping. In-fact the latest trends show that small businesses functioning from home rely heavily on hyperlocal deliveries to cater to their customers in a small geographical area. In fact such a business model has some of the most disruptive advantages such as:

  • Providing traditional stores an opportunity to gain visibility and optimise sales.

  • Retailers can enlist themselves on the platform in order to grow their business thereby negating the need of investing in building and maintaining an app.

  • Customers can expect better quality of goods and business standards as these platforms put pressure on the retailers to raise their efficiency levels and business standards.

  • And lastly and the most important, speedy deliveries

The online retail boom according to

According to Big Basket, demand for groceries and other essential items jumped 3 to 6 times since the lockdown. Deliveries have hit a new high of 2,83,000 as compared to 1,50,000 earlier. This signifies that hyperlocal businesses are here to stay. Going hyperlocal has become the new normal. In my opinion, hyperlocal food delivery companies such as Zomato and Swiggy can co-exist along with upcoming hyperlocal logistics companies such as Dunzo and WeFast. In the recent past, there was a rising discontent among the restaurateurs regarding the rising costs of listing their business and masking customer data from the restaurants. If such trends continue, we could see a large portion of the food and beverage industry shift to other companies in the competition.

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