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UberEats: Uber's New Food Delivery Service

First Posted: Sep 29, 2016 04:56 AM EDT
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Uber announced its plan of expansion of UberEats to three new metropolises: Amsterdam, Dubai and Johannesburg starting this Thursday. The food delivery network operated by the ride-sharing organization is already functional in 27 cities across the US and another six cities across the globe.

"UberEats has proved hugely popular in Europe," the company said in a statement. "We're excited about delivering food to people across the region as seamlessly as they can book a ride."

According to Reuters, Uber aims at expanding vigorously in the international market and will soon set foot in cities including Brussels, Stockholm, Moscow, Madrid, Hong Kong, Tokyo and other yet-undisclosed cities.

The expansion in the food delivery network is being backed by several job listings and mass recruitment ranging from managers to salespersons. Uber executives indicated earlier that UberEats' international diversification were an ordinary extension of its core business of transportation. However, the recruitment efforts being put in by the officials suggest that the company is preparing for its wider footprint beyond boundaries.

"UberEats is one (business) we feel incredibly confident is resonating across the world and resonating across the footprint of the cities in which Uber operates the transport business," Jambu Palaniappan,  who was recently named the head of UberEats for Europe, Middle East and Africa, told Reuters in an interview on Tuesday.

UberEats received investments of nearly $10 billion(8.9 billion Euros) into 421 food delivery deals since the start of 2014 but the funding dropped by more than half in the first six months of 2016.

The global restaurant takeaway market is projected to grow by 10 percent between 2015 and 2020 to reach $93.4 billion.  "The problem for many of the local players is that they are sub-scale: They can't compete without superior co-ordinations," said Neil Campling, Northern Trust Capital Markets' head of global research for the tech industry.

UberEats gains an edge over the local rivals by cutting its delivery time to within a 30-minute window, with no minimum order size or extra delivery charges. On the contrary, the local players say that orders will be delivered in a time window of 30 minutes to 60 minutes, while requiring minimum orders and charging customer an extra delivery fees. UberEats also benefits by being promoted through Uber's existing, very popular car hire app.

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