As Indian consumers grow more aware of global culture and trends, they are also growing hungry for best available dishes. The food industry has been challenged with being innovative in terms of offerings, while streamlining processes and strategies to achieve profitability.
The food tech domain has seen more than its share of action in the last couple of years. On the one hand there is the $7 billion food delivery market in India, growing fast; and on the other, online ordering has generated $0.5 billion in revenues. Consumers are looking at digitization, not just in terms of menus but also for discovering food. This is where food tech startups come into play.
The recent addition to the food-tech startup family is Dailycacy, which brings signature, popular dishes from the restaurants and best street food delicacies on the fingertips of the consumer.
In an exclusive interview with Indiaretailing, Dailycacy owner, Praveen Parihar reveals how his product is different from other market players…
At a time when market players like Swiggy are scaling down operations, how is Dailycacy planning to survive?
Companies like Tastykhana and Foodpanda were the pioneers who started food ordering business. At that time, market was in its nascent stage and they started acquiring customers with heavy discounts and cash burnout. Other market players like Tinyowl also followed the trend which in result spoiled the entire market. They entered into partnerships with restaurants without charging any commissions and no delivery charges were levied on customers. Subsequently, things started slipping out of their hands. Later on, they tried a lot to work on it. Result is there in front of you. It has closed down the operations and has merged with Runnr.
Swiggy started with a bit cautious approach where they started with restaurant commission and minimum delivery charges. However, the unit economics still doesn’t work. They have a policy where delivery charge is being levied after a certain minimum order value.
Dailycacy has started its pilot operations in Mumbai. There are number of factors which are causing troubles for food ordering platform. Here are the cautious steps that Dailycacy is taking to have a sustainable business:-
i. Delivery charges are not being charged by food delivery players:
Number of food ordering platforms will come and go if they don’t charge a nominal delivery fee from customers. It’s like you are a logistics-based firm and you not charging for your logistics cost which you incur. We know very well that customer cannot be charged an exorbitant amount for delivery. However, a nominal delivery fee is levied on to a customer to compensate the cost which is involved in logistics. We also ensure that maximum delivery charge doesn’t exceed by Rs 30.
Dailycacy is not just another food ordering platform. We are working hard to filter/curate the best dishes around the vicinity. This takes a lot of effort/money to try out these dishes and then get the feedback from internal food tasting panel. Therefore, it’s a premium food ordering platform where we ensure that whatever goes out to the customer is already tried and tasted.
We have fixed delivery charges slab based on the order value. If the order value increases, delivery charge goes down. We have setup this based on the calculation that at least we are able to recover the cost and in fact on couple of transactions even able to make profit.
Though we have just started on July 26, order traction is yet to be received. However, whatever orders are received, we ensure that we are either able to cover the cost or make profit on the order.
ii. Restaurant doesn’t pay the commission as the margin is very low:
Dailycacy follows a very cautious approach to make sure if the restaurant is not able to afford the commission then restaurant allows us to increase the dish price with nominal value.
There is separate person who specifically analyses if the pricing is within the affordable range of customer. That’s how we try to ensure that best dish is reaching to customer at affordable pricing and we are able to recover our Cost.
iii. Single source of revenue – restaurant commission/ delivery charge:
All kind of food ordering platform have same source of revenue- restaurant commission and delivery charges (which is not charged in 50 per cent of cases). Dailycacy has already defined a fixed delivery charges slab based on the order value. If the order value increases, delivery charge goes down. We try to maintain the figures there as well.
Dailycacy is dish-based platform, So we have a plan which will be converted into subscription-based model. Once we start experiencing maximum traction on our platform, we will be able to provide a much better subscription plan which is beneficial for restaurants.
How are Dailycacy’s operating strategies different as compared to other existing market players?
Logistics is something which is playing a major role in food delivery. We have started the pilot project in five areas of Mumbai.
- Pooling of order: Multiple orders to be delivered in the same location will be delivered by the same rider. Thus reducing the cost/time.
- Allowing multiple dishes from different restaurants (only adjacent/near by): In a month’s time we will be allowing people to order multiple dishes from different restaurants.
- Added services: Our concept is to find the best of dishes. We will be adding several other services such as best of fresh mutton, specifically those services which are catered in the morning where the fleet can be utilized.
Dailycacy works on a very unique model where only signature/ popular dishes are on-boarded from the restaurants and the famous food joints. These are tried and tested by panel of food experts.
Elaborate on your business model.
How many cities and pin codes do you currently deliver to?
We have launched our services starting from South Mumbai in selected areas like Dadar, Matunga, Mahim, Lower Parel, Bandra (some sections) and Worli. Soon, we will be expanding our services in entire South and Western Mumbai region in upcoming months.
How many orders have you delivered till date? What is the number of active users on your platform?
There are around 100 active users. As it is a just launched platform, we receive around 10 orders per day. We are expecting more traction in the coming days.
Are you a funded venture? Any plans to raise funds in future?
We are bootstrapped as of now. We have not raised any funds from the market but yes, we are looking to raise pre-seed investment to enhance the services and scale the platform.
To lure customers to order online, existing players have been bleeding money on discounts, loyalty programs and cashback options among other things. What is your strategy to acquire customers without affecting the margins. Elaborate.
We have set a target of not spending more than Rs 50 as customer acquisition cost. We are using unique ways to market the brand:
- Unique Restaurant Standee: At all the famous food joints/ restaurants which are our partners, we have placed a big standee to mark our presence that we are delivering the best of that restaurant.
- Unique Print Media Techniques: We will be drafting a dummy newspaper for marketing among corporate, families. It will be out soon.
- Student Ambassador Program: We are starting with unique student ambassador program where student leader is designated the responsibility for branding/ marketing of Dailycacy. These ambassadors will be recruited from the colleges to publicize our brand across campus.
- Corporate Tie up and Strategy: We have already started speaking to corporate for partnership where snacks, cakes, famous street food delicacies and meal can be ordered through Dailycacy along with special offer. That’s how we make direct entry to corporate and cover as much ground as possible. Thus reducing the customer acquisition cost.
There are many other plans which will be executed including referral campaigns. All the referral campaigns are planned with a very cautious approach, So that it lures the customer, avoiding high customer acquisition cost.
What are your unique product offerings?
Unlike other generic food ordering platforms, Dailycacy makes life easier by bringing you the best of the dishes chosen by our panel of food experts. You don’t need to scroll through endless menus of different restaurants. Just find signature dishes and popular street food at your fingertips anytime, anywhere.
- Unique Offering.
- Local favourites and famous street food dishes.
- Iconic dishes for ordering.
- Dish based rating and review as it makes easy to decide on dish selection.
- Food expert panel curation.
- Dish-based search.
What are your future plans?
We plan to become a premium food delivery service across different cities. A centralized platform where all the best delicacies are listed. We plan to include sections like best of healthy meal, organic meal, natural meal and diet meal.
We plan to make selection a better and pleasurable experience. We are any way flooded with too much information. Too many choices creates anxiety and it gets difficult for the customer to take decision. We will have less but we will have the best.
We also plan to launch the dish review platform soon. Imagine, you are checking into a restaurant, you finish your meal and you can just review the dish on Dailycacy! A dish-based review platform with specific dish differentiators and crowd source rating, will surely make your life easy.