Will Amazon’s Food Delivery Work in India after Losing in the USA?

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online food delivery

The tech-based company Amazon is all set to launch its online food delivery service in India in collaboration with a company founded by IT industrialist Narayana Murthy, founder of Infosys, named Catamaran. The company is still in its working phase and it is not yet clear if the online food delivery will be provided only to the prime members. Amazon prime services were launched back in 2016 in India offering services of online grocery delivery along with music and video streaming.

The company is expected to launch its scheme in the festive season of September. At present, according to reports by Indian newspaper Business Standard,  the Seattle based company is planning to buy the Uber technology which was launched back in 2017 for providing online food delivery service across India named UberEats but was not successful due to stiff competition. Amazon closed its food delivery system in the United States due to the stiff competition but came up with the same plan for India. Jeff Bezos’ foundation is also facing anti-trust investigations in its home country as well as in Europe. It is still under investigation whether Amazon and some other tech companies are involved in depriving users of benefits or not.

Amazon’s plan to pick up food from takeaway food outlets and restaurants will also help the company to promote its other services.

Current Indian Market Situation

In an increasingly competitive market for such services, the announcement of Amazon’s aim is expected to raise the bar. The reason for the wide investment in India on the online food delivery sector is its increasing middle-class population. A report from RedSeer Consulting says that the number of orders in India has increased by 176% in 2018. However, profitability yet remains difficult.

Currently, the domestic companies –Swiggy and Zomato- are leading the Indian platform of online food delivery. While Swiggy is being sponsored by Tencent and Naspers, Zomato is supported by Sequoia. Zomato has also expanded itself globally to countries such as Australia, UAE, New Zealand, Portugal, Turkey, Lebanon, the Philippines, and Indonesia.

Uber has not yet confirmed the rumors but its declining position indicates the same. Uber’s rival Ola also launched an online food delivery system and bought Foodpanda and is now focusing on its brand of kitchens. Amazon has stepped into the Indian market with competition from Flipkart, by Walmart Inc, and both the companies are planning to introduce various plans to attract their customers.

The e-commerce platform’s new service of online food delivery will surely make a huge profit in the future.

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