Dubai: Foodora, a Berlin-based food delivery start-up, is eyeing expansion in the Gulf to take advantage of a growing food delivery market, according to a top company executive.
After launching operations in Dubai in September 2015, the company is now looking to offer its services to customers in other emirates such as Sharjah and Abu Dhabi, and potentially in Gulf countries such as Qatar, Kuwait and Saudi Arabia.
“I think there’s a lot of potential in the Gulf. There’s a great food culture in Kuwait and Qatar. Delivery in Saudi Arabia could use our type of expertise,” Alexander Kappes, vice-president of Foodora for the Middle East, said in an interview.
Foodora — backed by German e-commerce group Rocket internet — was established in Munich in 2014. Customers can order from “premium, high-quality” restaurants that don’t usually deliver either through the Foodora website or app. It has partnered with more than 4,000 restaurants in 25 cities worldwide, such as Amsterdam, Milan, Oslo, Paris, Stockholm and Vienna.
In the short term, the company will focus on expanding the outlets available on the app and site, as well as the areas it serves in Dubai. It has partnered with more than 180 restaurants and cafes in the city such as Ping Pong, Pantry Cafe and Shakespeare and Co, to serve areas such as Marina and Jumeirah Lake Towers.
“We have signed 40 outlets, which we will be onboarding in the next couple of weeks,” Kappes said.
Consumers can download the Foodora app for free. After accessing the website or app, they will need to enter the name of their building or area, click on “find restaurants”, and then view a list of restaurants.
After orders are placed on the app, the company makes the delivery instead of leaving it to the food and beverage operator. Delivery takes no more than 30 minutes.
Kappes declined to say how many orders the company has processed in Dubai.
According to a survey by consultancy KPMG published last year, takeaway and home delivery in the UAE “is a relatively small proportion of the overall market, [but] this segment is growing, partly driven by the growth of online ordering platforms.”
Online food delivery companies present in the market include Talabat and Food on Click, among others.
The UAE’s food-and-beverage sector is expected to grow by around 4 per cent annually to reach $13.2 billion (Dh48 billion) in 2018, according to the KPMG survey. Food consumption in the Gulf is expected to grow at a compounded annual growth rate of 3.5 per cent until 2019.
“The frequency of people ordering food [in Dubai] is high,” Kappes said.
He said that he sees “very little competition” with the likes of Talabat and Food on Click.
Food delivery companies are attractive acquisition targets. Last year, Rocket internet agreed to buy Talabat for around $169.6 million, and Foodpanda, an online food delivery service which Rocket internet has a 52 per cent stake in, bought 24h.ae.
