SWOT Analysis of Swiggy | Swiggy Strengths, Weaknesses, Opportunities and Threats.
1. What is Swiggy?
Swiggy is a food ordering and delivery service. The company has been founded by Sriharsha Majety, Nandan Reddy, and Rahul Jain in June 2014.Its headquarters is in Bangalore, India
And it’s in more than 300 cities across India. In 2020 the company laid off 1100 employees during COVID-19 pandemic
2. How the Business Model of Swiggy?
Swiggy Business Model has a unique since it is a new player in the food delivery market, it faces some new problems.
In order to overcome these new problems, Swiggy has tried to introduce an online platform through which customers can order food from restaurants and have it delivered home.
This approach is very different from the existing restaurant model. Restaurant owners have been used to paying for each order and also getting a repeat customer base of repeat customers. These include;
a) Value Propositions: Swiggy is a new player in the Indian food delivery market. Since Swiggy has set-up an online platform, where customers can order food for home delivery, it is new player in the market.
b) Target Segment: Swiggy services are available in Bangalore and Mysore initially, then it will extend to the other cities. Swiggy is used by all age groups of 18-45 years who earn about $5,000 dollar .It has a strong presence in the young, tech-savvy population of India.
c) Customer Benefits: Swiggy is a platform to connect customers and restaurants. It is easy for customers to use the application and find the food they want and order food online and get it delivered at their doorstep.
d) Brand image: Swiggy has introduced free meal delivery in Bangalore. Swiggy is current business model is to offer free meal delivery in Bangalore for a period of two months. This will help in introducing Swiggy platform in the market. It will also help in customer acquisition among this segment
3. How Does Swiggy Makes Money?
a) Swiggy uses a business model called “freemium”. This means that it offers its services for free to the customer. In order to be able to use the services provided by Swiggy, a customer needs to pay a delivery fee.
b) Swiggy earns money from restaurants. Swiggy earns commission from the restaurants through which the food was ordered and delivered. The commission is about 10-15% of revenue generated from a restaurant.
c) Since Swiggy earns commission from restaurants, it will ensure its loyalty when the customer orders food through Swiggy.
d) By optimizing their business model, Swiggy can use data to make their business efficient. This efficiency is achieved by using the information gathered from customers.
e) Swiggy has the ability to increase the number of restaurants on its own. It also allows third parties to develop applications which can be used on the platform to increase the number of restaurants.
4. Swiggy Revenue and Financials
In December 2015, Swiggy has more than 1 million orders, making it the leader in the online food delivery space in India. The company’s revenues are expected to cross Rs.950 crore (US$140 million) by December 2018.
The firm began drawing outside funding in 2015. The first was a $2 million investment from SAIF and Accel Partners, which was followed by a $2 million investment from Norwest Venture Partners. Swiggy raised $15 million the next year from new and current investors such as Bessemer Venture Partners and Harmony Partners.
Swiggy was valued at $4.9 billion after receiving $800 million in Series J fundraising from Falcon Edge Capital, Goldman Sachs, Think Capital, Amansa Capital, and Carmignac, as well as current backers Prosus Ventures and Accel. In 2016, Swiggy raised another $70 million in series F financing.
Swiggy received $80 million investment from Naspers in 2017. Swiggy earned $100 million in 2018 from China’s Meituan-Dianping and Naspers, and a slew of other investments pushed the company’s worth to above $1 billion.
5. Swiggy Partners
Swiggy has a number of partners include:
a) Burger King: Burger King agreed to join Swiggy delivery platform in Bangalore, India, starting with Spice Burger outlets.
b) Sodexo: Sodexo, an international food service company, is in the process of integrating Swiggy delivery platform. It will be using this platform to manage its operations in India.
c) Google Local Guide: Swiggy is offering information on different restaurants. This is the information available on the Swiggy Local Guide, which was integrated into Google Maps. It also offers information on the current weather, calendar of events and shopping venues in Bangalore.
6. Swiggy Competitors
Swiggy has a number of competitors in its competitive space in India and globally. Some of the competition Swiggy faces is:
a) Zomato: Swiggy and Zomato are direct competitors in online food delivery services. Swiggy charges about Rs. 200 per order while Zomato charges between Rs.’ 200 – Rs.’ 300 per order, depending on the area.
b) DoorDash: DoorDash entered India in 2015. DoorDash focuses on the deliveries of food from restaurants and other businesses.
c) GrubHub: GrubHub is an online and mobile food-ordering service which allows users to order takeout or delivery from local restaurants.
d) UberEats: UberEats is an online food ordering and delivery platform if Uber, a taxi hailing app that was introduced in India in 2014.
e) Postmates: Postmates is an online delivery platform. They will be charged a delivery fee for each delivery order had been placed. This fixed price will range between $1.99 and $3.99 for Postmates partner retailers. Orders from all other vendors will range from $5.99 to $9.99.
f) Deliveroo: Deliveroo is an online food ordering and delivery platform.
g) ChowNow: ChowNow is an online food ordering and delivery platform. They charge 10% of the price of the order as delivery fee.
7. SWOT Analysis of Swiggy
· Strengths of Swiggy
a) Swiggy offers a quick and easy way to get food delivered.
b) Swiggy has a strong, profitable business model.
c) Swiggy has a good brand image in India.
d) Swiggy has a strong presence in cities such as Bangalore, Chennai and Mumbai.
e) Swiggy has a network of restaurants it can use to deliver food.
f) Swiggy is a good company with a strong growth potential.
g) Swiggy has strong IT infrastructure.
h) Swiggy has strong brand awareness among consumers.
i) Swiggy offers restaurant partners more control over the design of their menus.
j) Swiggy is cost effective for restaurants to use.
k) Swiggy is operating in an industry with low competition.
· Weaknesses of Swiggy
b) Swiggy currently only operates in Bangalore, Mumbai, Chennai and Delhi. It also does not operate in any other large Indian cities.
c) Swiggy needs to improve its delivery mechanism for food products. It needs product range and food items to be easy to order on the app itself, especially considering that it is used by customers with limited English skills.
d) Swiggy is a new competitor which lacks experience in this space.
c) Swiggy may have to battle with its delivery partner, Uber.
d) Swiggy is closed to home delivery.
e) The company might not be able to compete with its existing competitors like Zomato and Google Local Guide if these companies decide to lower their prices.
f) Swiggy has not yet launched its app in any other Indian cities.
g) Swiggy might struggle with the competition from GrubHub and DoorDash since it focuses on restaurants, not other businesses.
h) Swiggy is still new to the market and may have to face stiff competition.
i) Delivery times are slow.
j) Swiggy is open to misuse of the service by customers.
k) Swiggy delivery partners might be able to cheat in their ways.
l) Food quality is another concern in case any food product is not delivered in time in the right condition because of traffic jams in the city or due to careless driving by the delivery partner.
m) Delivery people might be rude or irritable towards customers, which reflects badly on Swiggy brand image.
n) Unethical delivery partners may steal food from customers.
· Opportunities of Swiggy
a) Swiggy has the opportunity to penetrate into the Indian market since it is a fast-growing market in its own right.
b) Swiggy has an opportunity to challenge local player Zomato, which dominates the online food delivery market in India.
c) Swiggy has an opportunity to build a strong brand presence in India by expanding its services to new cities.
d) Swiggy has an opportunity to expand its business by working with other businesses to deliver food products.
e) Swiggy has an opportunity to work with large cities in India that have a high growth rate, such as Mumbai and Bengaluru.
f) Swiggy has the opportunity to expand into new markets by offering food delivery services in these cities.
g) Swiggy has the opportunity to expand internationally since it is a strong brand name in India.
h) Swiggy has the opportunity to earn a lot of revenue from high-traffic restaurants.
i) Swiggy has the opportunity to earn revenue by partnering with other businesses to provide them with delivery services.
j) Swiggy has the opportunity to expand its services globally.
k) Swiggy made low price for customers which they can afford.
l) Swiggy made online payment available for customers which they can easily pay for their order on app itself.
m) Swiggy has developed an independent software that is easy for customers to use.
n) Swiggy can provide restaurant partners with better food options to offer to their customers.
o) Swiggy has taken an initiative in making its website simple for customers to use.
p) Swiggy has the opportunity to expand its services internationally.
· Threats of Swiggy
a) UberEats has expanded its services in India recently and plans to offer food delivery services.
b) Zomato, the largest food delivery service in India, is expected to focus on expanding its services into new cities.
c) Some deliveries experience delays.
d) Some restaurants charge higher delivery charges than other competitors.
e) Some customers believe Swiggy prices are too high.
f) Some customers find it difficult to navigate between the different menu options on the app.
g) Swiggy needs to take steps against fraud.
h) Food quality can suffer if delivery personnel fail to be prompt in delivering food.
i) Swiggy prices are high. Swiggy charges Rs. 200 – 300 per order of food delivered, which is more than other competitors such as Zomato and UberEats.
j) Swiggy delivers food to customers who do not even select the restaurant on their app.
k) Swiggy has a poor customer service department.
l) Some delivery personnel do not deliver on time or deliver items that customers did not order.
8. FAQs of Swiggy
Who is the Swiggy owner?
Swiggy was founded by Sriharsha Majety and Nandan Reddy as a food-tech startup (technology as a service) in 2014.
Why do we need to order Swiggy?
Swiggy can get fresh and delicious food from restaurants homes and offices throughout the day.
How does Swiggy work?
Using the Swiggy app, customers can browse through the menus of restaurants near them.
They can then complete their order by selecting the menu item they want, paying for it and waiting for their food to arrive. Swiggy also offers doorstep delivery in several cities.
What is Swiggy customer service number?
Swiggy customer service helpline is available in Bangalore, Delhi, Hyderabad, Mumbai and Pune.
What is Swiggy customer support number?
For all queries, Swiggy customer support team can be reached on their toll-free helpline all around the country.
Where does Swiggy deliver food to?
Swiggy delivery partners serve customers in as many as 300 cities in India. Deliveries take place from their own kitchen or from the restaurants that they belong.
Is Swiggy available in my city?
The delivery service is only available in the following cities;
Delhi, Mumbai, Bangalore, Bengaluru, Chennai, Kochi.
What is the operating time of the Swiggy app?
Swiggy has a 24-hour delivery service that takes place between 9 AM and 11 PM. The app is switched on between 8 AM and 11 PM.
How much does Swiggy charge for deliveries?
For orders above Rs. 300, Swiggy charges a delivery fee of Rs. 30 to Rs. 50. For orders under Rs. 300, the delivery fee is Rs. 10 to Rs. 20 depending on the distance and location of the restaurant and customer’s location.
Should we call Swiggy or place an order online?
Customers can place order either online or by calling them on their customer helpline number that is available all over India.
What are the types of payment options available with Swiggy?
Swiggy accepts cash, cheques, debit card, credit card, UPI and BHIM UPI for payments.
Payment options include Citrus Wallet, Paytm, FreeCharge, PhonePe wallet.
What can I do if I am not satisfied with my order?
Customers who are not satisfied with their order can cancel it within 24 hours of placing it.
Do I need to register an account with Swiggy?
Yes, a customer must register for a Swiggy account if he or she wants to use the services of this app.
What are the services available on Swiggy?
Swiggy has various services like doorstep delivery, online ordering on their app and on their website. However, the company only serves for food for now.
What is Swiggy delivery time?
The company delivers food within 30 minutes of placing an order with them. However, it can take longer if the restaurant is located in a remote area.
What are the delivery charges?
Swiggy has a delivery charge of Rs. 10 to Rs. 20 per order depending on the distance and location of the restaurant and customer’s location.
What is Swiggy minimum order value?
The minimum order value for Swiggy is Rs. 100.
Which restaurants are available on Swiggy?
Swiggy has partnered with select restaurants in various cities all over India. The app allows customers to order food from these restaurants.
How do I contact Swiggy?
There are several ways to get in touch with the customer support team of this delivery service. It can be done through their online chat, email, phone calls or social media accounts like Facebook and Twitter.
What are the steps to use Swiggy?
To use Swiggy, customers need to download their app and open it. They can then select the menu of any restaurant and complete their order.
After this, they will be able to see the upcoming delivery right on their app.
What is Swiggy cancellation policy?
Swiggy allows customers to cancel orders within 24 hours of placing them.
Who is Swiggy target audience?
Swiggy target audience includes restaurant owners, customers looking for regular orders from them and people who are not regular online food shoppers.
Do I need a Swiggy account if I am just ordering food from restaurants that I do not know?
No, this service does not require an account to be opened. However, customers must register for one if they want to use the services of the app.
Is Swiggy free?
Swiggy is free to use. This means that they do not have fixed charges for any of the services being offered.
Will Swiggy work offline?
Yes, Swiggy can be used offline. It is best to use this app while on the move because it will be able to deliver food to customers’ homes or offices on time.
How are Swiggy deliveries made?
Swiggy partners with delivery partners who are licensed to serve food. They are either their own employees or independent contractors of Swiggy.