Amazon Is Ready To Rival Zomato And Swiggy In The Indian Food Delivery Market

Dhir Acharya - Mar 02, 2020

After Uber exited the Indian food delivery market, admitting defeat to local firms Zomato and Swiggy, Amazon is gearing up to join the competition.

Just weeks after Uber exited the Indian food delivery market, admitting defeat to local firms Zomato and Swiggy, Amazon is gearing up to join the competition.

The giant retailer has the plan to enter the food delivery market in the country in the coming weeks, according to a person familiar with the matter. The service will be launched on one of these two platforms: Amazon Fresh or Prime Now, which may take place next month.

Amazon is about to enter the Indian food delivery market

In preparation for the launch, Amazon has been testing its service with certain restaurant partners in Bangalore, said the source without revealing further details of the new business.

It’s several quarters since the tech giant started its work on its food delivery service, aiming to roll it out during Diwali but that was delayed for unknown reasons. A spokesperson from Amazon said:

Capture

It’s not clear what kind of business agreement was formed between the tech giant and Indian restaurants, many of which have previously been frustrated with online delivery partners.

That will create more challenges to Zomato and Swiggy

Amazon’s entrance into the Indian food delivery market will result in new challenges for Zomato and Swiggy. These startups have raised a total of over $2 billion yet they’re not profitable, which lose over $15 million every month to get new customers as well as keep existing ones.

According to an India Quotient VC, the only choice for food delivery companies is subsidizing food prices ro their customers won’t be able to afford it. It’s challenging to make profits for a food delivery service in India, so the two aforementioned firms have expanded beyond this area.

Amazon itself has created a dense delivery network in the country using its own logistic chain as well as partnerships with thousands of stores. Unlike Zomato and Swiggy, Amazon is a giant company so it has a deeper pocket and will make generous investments with the ambitions to conquer one of the largest and most potential markets in the world.