The supply chain of the food industry has been changing since time immemorial. Indian food and beverage industry is poised to touch $46 Billion by the end of 2020, providing employment to 9 million people.
We brought down the entire supply chain into 6 distinct segments, diving deeper into each one them. Follow the pointers below to see it for yourself:
Cultivation of Fruits, Vegies, Spices, and Rearing of Animals
Startups in this sector:
Fasal
Freshokartz
Gramophone
Swiggy and Zomato, have not yet entered this segment.
Agri-Logistics
Startups in this sector:
Farmlink
MeraKisan
FarmersFZ
Swiggy and Zomato, have not yet entered this segment.
Food Processing
Startups in this sector:
Intello Labs
WayCool Foods & Products
Swiggy and Zomato, have not yet entered this segment.
Distribution to HORECA (Hotel, Restaurant, Cafe)
Zomato: already has this service offering in the form of Zomato’s Hyperpure (an end-to-end technology driven solution):
Currently serves 7,500 restaurants across Delhi and Bengaluru.
Already has 30,000 sq ft warehouse.
Directly connects with farmers, mills, producers and processors to source the raw material.
Recently opened a 10,000 sq ft warehouse in Mumbai.
Swiggy:
Although Swiggy entered into the Food delivery space much before Zomato, Zomato has the first mover’s advantage in this segment.
Swiggy has entered this segment very recently (May 2020), by the name of Swiggy Staples Plus.
It delivers grocery, meat, veg and other supplies along with packaging material to restaurants.
These are provided on credit basis.
Other players in this segment - Ninja Cart & WayCool
Cooking
Swiggy: Cloud Kitchen
Model - Swiggy sets-up a kitchen, investing in state-of-the-art kitchen equipment and real estate, taking ownership of the setup. This setup does not have any front-end. All orders are received over Swiggy’s app and delivered at customer’s doorstep. Swiggy functions by the name of Swiggy Access and Swiggy Pods in this segment.
Nature - This kitchen becomes a direct competitor of all restaurants listed on Swiggy. Data of all restaurants listed with Swiggy can be used to come up with the best fit solution.
Scale - Total investment - ₹175 Cr. Over 1 Million sq. ft. to enable over 1,000 Access kitchens across the country.
Investment in Kitchen Equipment (as per financials) - ₹17Cr.
Zomato: Shadow Kitchen
Model - Zomato develops a kitchen, investing in state-of-the-art equipment and real estate, much like Swiggy. However, this kitchen is then leased out to HORECA brands like Haldiram, Keventers and Freshmenu, to name a few (Much like WeWork of Kitchen). Management of the kitchen is done by the HORECA brand, while order processing and last mile deliveries are handled by Zomato.
Nature - Zomato clarified that it will never compete with its restaurant partners and the company will only help in building kitchens, which will be operated by restaurant brands.
Scale - In total, there are 663 kitchen units and kiosks in India, developed by Zomato.
Investment in Kitchen Equipment (as per financials) - ₹5.5Cr.
Last Mile Delivery
Food Delivery Segment Numbers:
Fresh Ideas Delivered:
Drone Delivery:
Sitting today, we may believe that the modern ways of food delivery have indeed been revolutionized by Swiggy & Zomato. But even this concept may become redundant in a few years with advancement in drone tech and related policies.
Some perspective: Ele.me, a Chinese food delivery platform uses drones for 70% of its deliveries in China.
So are Indian startups sitting ducks? Not really! Zomato acquired TechEagle Innovations in 2018, which is into Drone tech (refer coverage on acquisitions).
Hyperlocal Delivery:
Hyperlocal delivery comprises of B2C and C2C deliveries within a city.
Some key players - Dunzo (pioneer, backed by Google); Swiggy Genie (launched during 2020 lockdown); Uber Connect (launched during 2020 lockdown)
Grocery Delivery, Milk Delivery, Tiffin Delivery and other niche areas:
Key players include - Groffers; Big Basket; SuprDaily; Zomato (launched and closed down during 2020 lockdown)
SO Who's Better? Swiggy or Zomato?
Go through all our analysis to frame up your mind (tap on the picture):
The Big Fat Advertisement cost of Swiggy and Zomato
Can Swiggy & Zomato Break-Even?
Socially Responsible - Swiggy or Zomato?
This article is a part of the July'20 edition of our Startup Newsletter. Here's the complete publication:
