Apple News Facebook Twitter 新浪微博 Instagram YouTube Friday, May 10, 2024
Search
Archive
English>>

China’s online food delivery gets expensive: survey

(People's Daily Online)    16:25, March 28, 2019

(Photo/Chinanews.com)

Chinese customers are paying more when using take-away apps, according to a recent survey launched by Chinanews.com in Beijing.

Liu Jiang, a human resource system developer as well as a frequent food delivery customer, noticed the rising cost of getting food delivered to his door.

He said that before the Spring Festival, he could easily order a meal for 20 yuan, but now the same meal has risen to upwards of 25 yuan.

Online takeaways became more expensive after the traditional Chinese Spring Festival in early 2019, said Jiang Si, a new media member of staff in Beijing.

Buyers are less likely to find a meal under 20 yuan on food delivery apps as a result of fewer discounts and a higher threshold for a single online order, he noted.

Some merchants argue that they are not responsible for the recent price hike, attributing the rise to an increase in commissions and delivery costs.

The survey found that delivery fees, which are priced by the platforms and co-paid by the merchants and buyers, are an average of between 6 to 8 yuan. The highest on a single order found was 15 yuan.

A deliveryman told Chinanews.com that they don't earn more from the increased delivery fees.

China’s food delivery app Meituan introduced new commission rates of 10 to 25 percent after this year's Spring Festival, and all merchants on the platform were informed of the update.

The app explained that the decision to increase commissions was made due to the company’s high costs in operation and labor. On top of that, large capital was invested in a new smart scheduling system to enhance efficiency, which also led to the rise of commissions.

China’s food delivery industry kicked off in 2003, and experienced exponential growth in the years that followed. In the initial phase, a price war broke out between different delivery apps to compete for a larger market share.

Until now, Meituan has occupied the largest market share of 64.1 percent in China. Ele.me is the second largest food delivery app in China, accounting for 33.7 percent of the market share.

Meituan’s revenue reached 65.2 billion yuan in 2018, seeing a rise of 92.3 percent from the previous year, according to the company’s financial report. In contrast, its losses were as high as 115.5 billion yuan in the same year, hitting an all-time high since the company went public.

An analyst said that market share is no longer the focus for these O2O apps for food delivery, leaving many companies trying to figure out how to increase profits.

(For the latest China news, Please follow People's Daily on Twitter and Facebook)(Web editor: Hongyu, Bianji)

We Recommend

Most Read

Key Words