Australian food delivery experiencing rapid growth, Morgan Stanley
Online takeaway food delivers like UberEats and Deliveroo are experiencing rapid growth in Australia says financial service provider Morgan Stanley.
In a new report, Morgan Stanley has attributed the growth to the convenience and choice provided by Australia’s food delivery players.
According to the report, Morgan Stanley estimates Menulog, Uber Eats, Foodora and Deliveroo generate more than AUD $600 million in total transaction value in Australia today.
Demographics, increasing population coverage and greater restaurant adoption should see delivery total transaction value expand to AUD $2.4 billion by the 2025 Australian financial year Morgan Stanley predicts.
Menulog currently leads in terms of total transaction value with c.AUD $500 million generated across 9, 000 restaurants.
UberEats is however catching up and now has more app downloads than Menulog, 2.5 million compared to Menulog’s 1.6 million.
More room for growth
Morgan Stanley says Australia is relatively underdeveloped when it comes to online food delivery, with a 10 per cent penetration rate. Comparatively, the UK is currently sitting at 34 per cent.
“We think the online aggregator market remains fragmented in Australia, unlike other industries such as online classifieds, which tend to be winner takes most,” Morgan Stanley commented in its report.
More ‘dark kitchens’ likely to come and the economics of food delivery
Morgan Stanley said it expects more ‘dark kitchens’ (kitchens which only produce food for online deliveries) to emerge and compete with existing traditional food service providers.
Morgan Stanley also said food delivery providers need to consider the finances of a number of parties – food service providers, delivery drivers and customers.
“Our analysis of the economics shows that restaurants need more than 50% of sales to be incremental or else suffer lower profits after signing up with an aggregator,” Morgan Stanley wrote.
“Restaurants that sign on with aggregators – even chain operators like Pizza Hut –
risk losing control over pricing, delivery quality and customer data longer term.”
- Australian restaurants benefiting from delivery, IBISWorld
- Australia’s best food delivery services, Canstar Blue
- BWS goes into delivery
Instead of learning about the right and wrong foods to eat, let’s learn instead about the many diffe...
Both the New South Wales and South Australian Departments of Primary Industries (DPI) are urging pri...
CSIRO scientists have had a breakthrough which will allow for the world’s strongest material to beco...
Vitasoy has launched a new soy milk called ‘2 Beans’.
The CSIRO has discovered how to stimulate higher-levels of oil production in stems and leaves, parts...
Monash University’s Food Innovation Centre has launched a $3 million incubation facility with Choban...
Food-to-go is one of the food industry’s most exciting areas, with many innovative products tested i...
The winners of the 2018 Australian Grand Dairy Awards have been announced with the 2018 Grand Champi...