TheJakartaPost

Please Update your browser

Your browser is out of date, and may not be compatible with our website. A list of the most popular web browsers can be found below.
Just click on the icons to get to the download page.

Jakarta Post

Plenty of room for growth for food delivery services

Meals on wheels: Couriers for Go-Food, a food delivery service operated by Go-Jek, collect customers’ orders in Jakarta on Aug

Riza Roidila Mufti (The Jakarta Post)
Jakarta
Sat, January 12, 2019

Share This Article

Change Size

Plenty of room for growth for food delivery services

M

eals on wheels: Couriers for Go-Food, a food delivery service operated by Go-Jek, collect customers’ orders in Jakarta on Aug. 4, 2018.(Bloomberg/Dimas Ardian)

Purchasing food has never been this easy. Today, people can have their favorite dishes from a particular restaurant delivered to their home by convenient food-delivery services such as Go-Food or GrabFood.

Maghfira, a 25-year-old resident of Surabaya, East Java, for example, relies heavily on the online delivery services for her meals.

“Online food delivery services like Go-Food are special to me because I am reluctant to go out to buy food,” she said, referring to the service provided by homegrown ride-hailing app Go-Jek.

During 2018, Maghfira made 167 food and beverage orders, with chicken and duck items listed as her favorites.

“I am also a picky person who dislikes going around the streets looking for random restaurants and other places to dine at. Meanwhile, Go-Food has a best-seller feature on the app that really helps me find good food,” she said.

The growing trend of purchasing food and beverages through online delivery services has accelerated in recent years. Go-Jek says it delivered 529 million food and drink orders across the country through Go-Food
in 2018.

Go-Jek commercial expansion chief, Catherine Hindra Sutjahyo, said Go-Food experienced exponential growth in 2018, both in terms of order volume and users, but declined to break down the exact growth figures.

“The year 2018 was a great year of collaboration for us. Why? Because we achieved unexpected growth in Go-Food, thanks to Go-Food’s triangle of collaboration — customers, merchants and drivers,” she told the press recently.

Research by the University of Indonesia’s School of Economics and Business in nine cities in 2017 showed Go-Jek contributed Rp 9.9 trillion (US$703.9 million) annually to the national economy, Rp 1.7 trillion of which came from Go-Food.

The company also reported a growing number of merchant partners, reaching 300,000 by December 2018, up from 125,000 in January of the same year. When Go-Food was first launched in 2015, the number of merchants was only 10,000.

In 2018, Go-Jek claimed that Go-Food delivered 7 million martabak (sweet or savory pancakes) in a year, an increase from the 3 million they delivered in 2016.

Grab Indonesia also claimed explosive growth in its food delivery service GrabFood. Grab Indonesia’s marketing director said GrabFood’s delivery orders grew over sixfold compared to last year’s figure, and GrabFood merchants increased eightfold in 2018 compared to the previous year.

Both Go-Jek and Grab are also optimistic that online delivery services will continue to grow in the coming years.

PricewaterhouseCoopers’s partner advisory Sharly Rungkat said services such as Go-Food and GrabFood not only created a significant new market in food delivery services but have totally re-invented the Indonesian dining experience.

“Working families with dual incomes are no longer obliged to have a home-cooked meal when it’s much easier to have food delivered to them,” she said.

Sharly said the catalysts for all the changes in consumer behavior were the number and variety of food merchants on the platform as well as the various promotions and discounts offered.

“Now that consumers have experienced the convenience of food delivery and it has become a ‘new-normal’ consumer behavior, there will be significant opportunities for growth for the players to continue to develop the services in Indonesia,” she said.

Sharly believes the current penetration only represents a few cities. “There will still be a significant upside for this market to grow once the services enter other cities in Indonesia. Obviously the consumer behavior toward food delivery may vary in different cities, nevertheless there are significant opportunities yet to be tapped for food delivery in Indonesia.”

{

Your Opinion Matters

Share your experiences, suggestions, and any issues you've encountered on The Jakarta Post. We're here to listen.

Enter at least 30 characters
0 / 30

Thank You

Thank you for sharing your thoughts. We appreciate your feedback.