Food delivery companies managing profit margins key to long-term success, say experts

Revenue in the local online food delivery sector is expected to exceed $466 million this year, up 27 per cent from last year, according to research firm Statista.
Revenue in the local online food delivery sector is expected to exceed $466 million this year, up 27 per cent from last year, according to research firm Statista.ST PHOTO: KUA CHEE SIONG

Food delivery companies have been expanding rapidly here in recent years, but slim profit margins and the competitive landscape mean they need to be savvy about how they expand and structure their business model, say experts.

They identified an oligopoly in the sector here - foodpanda, Deliveroo and GrabFood are the major players, although several smaller firms are slowly carving their niches within the booming industry as well.

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A version of this article appeared in the print edition of The Straits Times on October 30, 2019, with the headline 'Managing profit margins key to long-term success, say experts'. Print Edition | Subscribe