Takeout at your fingertips
2017-03-13, XU LIN in Beijing

On a recent business trip, Liu Qidi, 30, a manager with a family-owned cosmetics firm in Hubei’s capital Wuhan, arrived hungry around 9 pm at her hotel room in Yichang city in the same Central China province. For supper, she neither visited the in-house restaurant nor stepped out into the chilly weather.

By 9:10 pm, however, a delivery man from a local takeout materialized with a fresh hot pizza and milk tea. Liu had ordered the food using an app on her way to the hotel.

Such apps, which act like digital bridges connecting consumers and sellers such as restaurants, are making a big difference to the food and beverage industry.

As a result, consumers (that is, mostly office-goers, students and some business travelers such as Liu), the businesses concerned (chiefly tech startups and eateries), and people working for such app-based businesses, are a happy lot these days.

Particularly for consumers such as Liu, food delivery apps are the best things to have come along since the proliferation of the Internet and smartphones in China.

“It’s so convenient. You don’t have to wander around the streets for food, especially when you reach a hotel at 9 or 10 pm,” she said.

It is not just about convenience or the time saved — there is more to food delivery apps, said Liu, explaining that the meals budget for mid-level executives at private firms during official trips is limited. “So, takeout apps allow us to enjoy delicious local dishes at relatively cheaper prices.” 

Liu’s pizza and milk tea cost around 40 yuan, or $5.80.

Typically, Liu orders from offline restaurants that sell quality food made in clean kitchens. She reads consumer comments on the app concerned, and then picks top-selling restaurants, particularly those that allow users to customize their meals. For instance, Liu specifies her preference for dishes cooked without garlic.

She is satisfied with the delivery service in Hubei’s smaller cities as well. Usually, within 30 minutes of placing the order, her food is delivered by people who are polite and helpful, she said. For example, they caution her if the drink is hot.

Such user experience and service quality have helped make takeout apps a mainstream business sooner than expected.

According to the latest annual report of Analysys, a Beijing-based consultancy, China’s takeout apps netted sales of 45.78 billion yuan in 2015.

The market is expected to grow further in the next five years. In the last quarter of 2015, 67.7 percent of the business was from offices and 26.6 percent from university campuses. More than half of the orders were for less than 30 yuan each.

“App users are typically consumers living fast-paced lives. Businesses like restaurants can increase their profits by working with takeout apps,” said Zhang Yan, vice-president of Baidu Takeout, which is among China’s top food apps.

Its main customers are big city white-collar workers aged 25-40, a group less price-sensitive than others but valuing food safety and timely delivery, Zhang said.

The app mainly works with chain restaurants that ensure food safety and quality service. Its staff conduct spot checks from time to time and ask participating restaurants to rectify problems, if any.

“The takeout apps are bringing us more business. We mostly deliver lunchboxes and regular Chinese dishes,” said Wang Jiuwei, in charge of Jinbaiwan, a Beijing-based takeout chain known for its Peking duck delicacy.

One of Jinbaiwan’s branches near the Beijing Railway Station gets between 400 and 500 delivery orders a day during weekdays. The restaurant had its own delivery team until 2015 when the function was outsourced to Baidu Takeout.

To prepare its packaged lunches, Jinbaiwan uses pan-like machines that can process about 1 kg of food at a time if all the ingredients are in place. These are easy to operate and save cooking time for the chefs.

That makes it easy to start an app-based takeout business that links physical business and e-commerce, and relies heavily on quick delivery, according to Tian Yu, the cofounder of Beijing-based restaurant Jacky’s Kitchen.

“We attach great importance to taste, our performance-price ratio and customization of food, to ensure good user experience,” said Tian, whose spicy seafood is ordered a lot on takeout apps.

“Compared with traditional restaurants, we have different characteristics,” he said. While regular restaurants need to be at a good location, and spend money on interior design and staff wages, eateries whose business comes mainly from takeout apps save on such costs and need to spend only on delivery, packing and service fees to the apps.

For instance, Jacky’s Kitchen is just that — a kitchen. It is a restaurant only in name, without any dining facilities.

Takeout apps depend on their delivery staff for whom summer and winter, when people are generally reluctant to dine outside, are peak seasons.

Delivery staff’s income is linked directly to the number of deliveries they make, and whether or not they are made on time. Delays can lead to loss of income.

“Many orders are placed around meal time, and that piles pressure on me. But I try my best to ensure that customers get hot food,” said Wang Xiaofeng, 24, a delivery woman in Beijing.

Most of her colleagues are men. She started to deliver food for Baidu Takeout in 2015, and has since taken 40 orders a day on average, earning up to 8,000 yuan a month. But her income tends to shrink during slack seasons.

You Haicheng, 30, a deliveryman from Meituan, another major takeout app in China, gets about 12 to 15 orders at lunchtime and has to deliver all within one and a half hours.

“I’ll deliver them based on which restaurant has prepared a dish already, so I don’t have to waste time waiting for them to finish cooking.”

Many customers empathize with delivery people if there are understandable delays due to bad weather. “When someone shows he or she cares, I’m touched,” You said, citing the case of a young woman who not only did not complain when he delivered her food an hour late due to rain but gave him tissues to dry himself.

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