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BUSINESS IDEA

Organic meal delivery online

 

Ordering food on a daily basis is an absolute mess!

  1. Most food options are unhealthy.
  2. 15-30 minutes spent daily on deciding what to eat.
  3. Existing meal subscription apps dilute food quality to meet a ‘budget’ price.

 

How big a mess it is?

Indian online food ordering market is set to grow at a Compounded Annual Growth Rate (CAGR) of 16.2%, touching $17.02 billion by 2023.

Total sales by online food delivery partners increased from $750 million in 2017 to $1.7 billion in 2018. While the average food order value in the Top 7 Indian metros is ₹300, the same in smaller towns is between ₹150-200.

 

The solution

An online platform which delivers signature lunch and dinner dishes, curated by renowned chefs and made from 100% organic ingredients. This is how the platform would work:

  • There will be just 2 options every day for each meal; veg and non-veg.
  • Changing food menu with nutritional information will be displayed for the next 30 days.
  • Users can pre-book meals for a day (to try it out), a week or a month.

 

Suggested pricing

The target market for the platform will be the middle and upper-class working population, who can afford around ₹8k/month for hot, organic meals delivered to their office and home.
The pricing for 2-meal (default) and 1-meal plans are as follows:

 

Some assumptions

With good food quality, a stable platform and the right mix of online and offline marketing, this is assumed from the second month in business:

  • 200 deliveries per day (amongst our various plans), except Sundays.
  • 5,200 deliveries per month (200 * 26 days).
  • ₹170 average order value (based on the likelihood of a plan subscription and its order value).

 

Fixed one-time expenditure


50,000  |  Company incorporation and reduced license procurement cost

₹2,40,000  |  3-month deposit for renting out a portion of an existing (compliant) cooking facility in a non-prime area, with a rent of ₹80,000 p.m.

₹90,000  |  Web platform design and development

₹3,80,000  | Total fixed expenditure

 

Estimated monthly expenditure


80,000  |  Cooking facility rent

₹40,000  |  Menu creation fee based on nutrition and taste by a known chef (with a 1-year contract)

₹2,08,000  |  Meal ingredient cost (₹40/meal * 5,200 monthly meals)

₹52,000  |  Gas and electricity cost (₹10/meal * 5,200 monthly meals)

₹1,20,000  |  Salary of 4 cooks to prepare 200 meals/day (₹30,000 * 4 cooks)

₹40,000  |  Salary of operations head for food procurement, maintenance and delivery

₹30,000  |  Salary of 2 operation executives (₹15,000 * 2 executives)

₹52,000  |  Packaging cost (₹10/meal * 5,200 monthly meals)

₹80,000  |  Delivery expense for 200 meals/day with 4 executives, incl. fuel  (₹20,000 * 4 people)

₹25,000  |  Digital marketing (content creation and advertisements)

₹20,000  |  Targeted, offline advertisements

₹15,000  |  Facility maintenance, equipment repairs and upgrades

₹10,000  |  Website and server maintenance expense

₹10,000  |  Compliance and ‘other’ expenses

₹7,82,000  | Total monthly expenditure

Note: This is the minimum cost for organic meal preparation and distribution, based on affordable food subscription plans.

 

Estimated monthly revenue


34,000  |  Daily revenue (200 deliveries daily * ₹170 average order value)

₹8,84,000 | Total monthly revenue

Assuming 26 working days in a month, since Sundays are excluded.

 

Monthly cashflow


₹8,84,000 |  Revenue, i.e. inflow
₹7,82,000 |  Expense, i.e. outflow

₹1,02,000 | Net monthly inflow

Note: It is assumed that the initial investment is not borrowed. If it is, deduct the EMI from the above amount.

 

Growth Rate

Assuming you are providing quality service and are marketing your offering, you can expect a growth rate between 10-20% month-on-month. We wish you the very best 🙂

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