Klik-Eat’s Challenges in Expanding Food Delivery Business in Indonesia

Hello everyone! It’s August already, Idul Fitri holiday is officially over now, so we need to keep track of our works and busy weeks are coming up. This post will discuss about our merchant that is engaged in food ecommerce industry, Klik-Eat.com.

Klik-Eat.com, Indonesia’s online food delivery service, in which you can just browse your favorite foods through their website when you’re hungry and the food will be delivered directly to your home, simple and practical, isn’t it? It has been a year since they got series A funding from Japan’s Yume no Machi Souzou Iinkai (JASDAQ: 2484), so according to the co-founder of Klik-Eat, Michael Saputra, it’s time for this startup to start expanding using that funding. Currently, they have partnership with over 500 restaurants all around Jakarta and also have a spin-off business in the form of PapaBento, an online catering service for corporate events in Jakarta, Tangerang, and Bekasi areas. Their spin-off business currently contributes 20 percent to the total transaction volume of Klik-Eat.

Saputra does not want to reveal the average number of deliveries that they make every day, but he shares that Klik-Eat currently has 35 couriers who are ready to help restaurants delivering foods to their customers. As Saputra said “This business is manpower intensive, so the scalability is quite tough” and thus, the biggest challenge in running this business is to manage the delivery service to customers rather than finding restaurants for partnerships. As it is said by Saputra that food delivery service in Jakarta is hard, it has a lot restrains due to traffic and thus, restaurants usually do not have a dedicated delivery guy that can delivery warm food to customers under any circumstances.
Restaurant commonly use their staff that have nothing to do to do the deliveries and thus, the delivery system of restaurants in Jakarta is still unreliable.

Recently, Klik-Eat have already had mobile websites and thus, their team also have to pay attention to its mobile apps. Moreover, Klik-Eat will launch their expansion to Bandung after Idul Fitri holiday. Currently, 55 percent of their transaction volume comes from order through desktop, the rest is either from smartphones or phone calls. Saputra also mentioned that the number of customers that access Klik-Eat from iOS is 18 more compared to those who access Klik-Eat from Android and therefore, he believes that the rumors that say iOS users spend more on their phones is true.

During Ramadan period, Klik-Eat recorded a 30 percent increase in average website traffic. The team have also recorded a growing value per order. Up until now, Klik-Eat’s biggest competitor in Indonesia is Rocket Internet’s FoodPanda. There are actually other online food delivery startups in Indonesia, but most of them are still operating in different cities.

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