Strategic Analysis of Deliveroo: Entry, Growth, and Future Prospects

This report delivers a critical analysis of Deliveroo, a leading online food delivery service, examining its entry into the market, strategies for growth and sustainability, and future prospects. The report explores Deliveroo's business model, competitive advantages, and use of Porter's Generic Strategies and Five Forces model to assess the external and internal environments. It details the company's founding by Will Shu, its product development, and strategic positioning. The analysis includes competitor analysis, value chain analysis, and a PESTLE analysis at entry. The report further investigates Deliveroo's growth and sustainability, including SWOT and VRIO analyses, strategic group dynamics, and leadership roles. Finally, it considers future opportunities and provides recommendations based on the findings. The report uses data to analyze the company's performance and its position in the market, highlighting key factors such as customer satisfaction, rider satisfaction, and financial performance. The analysis provides a comprehensive overview of the company's development, its challenges, and its potential for future success.

ENTREPRENEURIAL MANAGEMENT

Table of Contents
Table of Contents.............................................................................................................................2
Executive summary.........................................................................................................................1
INTRODUCTION...........................................................................................................................2
1. Overview of the Deliveroo..........................................................................................................2
2. Start of the Deliveroo entry.........................................................................................................3
2.1 Will shoo founder..................................................................................................................4
2.2 The idea.................................................................................................................................4
2.3 Product development.............................................................................................................4
Opportunity and Porter 's Generic strategy-................................................................................4
Porter's five forces.......................................................................................................................5
Crossing the CHASM..................................................................................................................6
Competitor analysis.....................................................................................................................7
Value chain analysis....................................................................................................................8
PESTLE at entry..........................................................................................................................8
PART 2..........................................................................................................................................11
3. Growth and sustainability..........................................................................................................11
Porter's Generic competitive strategy at growth........................................................................11
Five forces model at growth......................................................................................................12
SWOT analysis entry.................................................................................................................13
Strategic group at growth...........................................................................................................14
VRIO analysis at growth...........................................................................................................15
Building blocks of competitive advantage................................................................................15
Leadership roles and life-cycle of Deliveroo.............................................................................17
Sustainability.............................................................................................................................17
4. Blue skies or future....................................................................................................................18
5. CONCLUSION & RECOMMENDATIONS............................................................................18
REFERENCES..............................................................................................................................19

Executive summary
This report gives the critical analysis of the entry, sustainability and growth, and
described the future of Deliveroo Ltd, it is the business that provides the best food delivery
services to the customer. This is the best online food delivery app they doest have any stores and
machinery so the operating cost of firm is low. In order to identity the internal and external
activities of the firm this report has critically evaluated the the business internal or external
environment by using the pestle, swot, porter’s generic strategies model, porter’s five forces, Ans
off matrix etc.
Thus, deliveroo was established in 2013 that is founded by will shu . He is the best
entrepreneur who implement their idea into business. In starting carrier of the business, Will
saved the money to invest their funding in new business which is online food deliverer services.
This new idea has connects restaurants to consumers through their app and couriers services.

INTRODUCTION
Deliveroo is the company that delivers the food, founded in 2013. It operates in the two
hundred cities in the London. Company reported in the headquarter of London and makes the
money by charging the restaurants as a commission fee and also charge the customer for the
respective order. This report contains that how the Deliveroo can create and sustain the
competitive advantage that are unique activation method, customer satisfaction recorded,
customer retention, network successful and cost efficient. This report also elaborate the need of
the business to sustain it in the future includes the examination of business strength,
Organisational capabilities, Green Positioning, Green Disposal, Hire the company that provides
the business information, Corporate Social Responsibility.
1. Overview of the Deliveroo
will shu and Greg Orlowski is founder of the company it also called Roofoods Ltd.
(branded as Deliveroo) It is a British online food delivery company (Shu, De Clercq, Zhou. and
Liu, 2019). Based in London, firm sales their products and services in two hundred cities in the
United Arab Emirates, Kuwait, and Taiwan, United Kingdom, the Netherlands,
Singapore,France , Germany, Belgium, Ireland, Spain, Italy, Australia, Hong Kong. Thus, firm
provide the best services through online which is food delivery and ordering services to the
customer. A subsidiary operation, Deliveroo Editions, focuses on developing a network in all
over the world. Thus, customer want to purchase the product, so they order their food through
online app they place their order on the websites, Deliveroo contract with biggest restaurant
across the uk. So they deliver the order of customer through Currier services. Deliveroo’s
employees are riders, who delivered the products and services, who pick up the orders at
different restaurants who contract with Deliveroo by implementing the high software which
develop the best way to provide the order to the customer on efficient time.

Illustration 1: Deliveroo Revenue and Usage Statistics, 2019
(Sources : Deliveroo Revenue 2019)
From the above chart it can be analysed that why riders work with Deliveroo. 45% of
people said that they give their hundred percent to achieve and meet the requirement of customer
in order to support a further long-term goal. Thus, the riders of firm satisfied with the job as they
find that this job is provide the flexibility this demographic also particularly valued flexibility.
According to the data (Deliveroo Revenue and Usage Statistics, 2019) of 2016 Deliveroo earn
£129 million and according to the financial time report that the employees of the firm is 200000.
in 2017 Deliveroo confirms that company works with 30000 riders.
2. Start of the Deliveroo entry
Deliveroo was started by the Will shu, who was a former banking analyst. It is the online
company which provide the food deliver services that has started in the year 2013. Henceforth,
Quoted enterprise offers takeaway food from the many of the restaurants and most of them not
offer this types of services before the start-up came along. Thus, business model of this firm is

very simple but different from the traditional start ups. It has more than 450 drivers and cyclists
as of now that delivers food from the restaurant to the end user. Deliveroo charges delivery fees
on each order from the customer.
2.1 Will shoo founder
Will Shu is the founder of Deliveroo he was born in Connecticut, United States of
America to Taiwanese parents in 1979. The education life is goods Will Shu receive their
bachelor’s degree of Northwestern university, and then Will Shu got their first job in Morgan
Stanley's in New York City as an investment banking analyst post in 2001. He found this idea in
2013 with childhood friends and finally they start their business with new and innovative ideas
name called Deliveroo.
2.2 The idea
Will shu founder of the Deliveroo, came up with the idea to start the firm after saw that
there were lack of suitable food delivery option within United kingdom. Therefore, idea behind
this is to allow customer to choose the food in variety of restaurants according to their taste and
income.
2.3 Product development
Delivero is taking various initiatives to provide the best and suitable online services to
the customer in few minutes by promoting their services for people so that they use to think
about the Food delivery services form premium restaurants. It is the firm that provide the people
high quality local cuisine from the places that the customers knows and like the most.
Henceforth, transparency, convenience and quality all are the most valuable services of this
entity.
Opportunity and Porter 's Generic strategy-
The key strategic challenge of most of firms is to find out the right way of achiving the
competitive advantage over the commodities and enterprise in market.
 Cost leadership- In this firm sets out to become low cost produce in the industry.
Henceforth, the soruce of cost advantage are varied and also depend on structure of
entity. The firm has adopted cost leadership strategy that involves of developing
economies of scale and making efforts t =o have reduction in cost.
 Differentiation cost- It is the cost that involves the creation of product or service that can
be perceived through out the country that is unique. Therefore, firm as Deliveoo charge

premium price for the commodities. Low cost strategy aids to have higher profitability as
it creates the better entry barrier. This is helpful as it helps to enhance market share.
Illustration 2: Porter's Genric strategy
(Source: Porter's Generic Competitive Strategies (ways of
competing) , 2017)
 Differentiation focus- Deliveroo has started their working with innovative step within
the market of UK. Thus, this firm has adopted this startegy as they came with idea that
relate wth lack of suitable options.
 Focus strategy- At this level, the entity targets much larger market and also aims at to
achieve competitive advancement through differentiation cost across the whole of an
indutry. This is about charging the premium price of the commodities and give
reasonable reason to hcarge the higher price for the services.
Porter's five forces
This is the tool which helps to analysis the competition This tool assists in analysing of the
level of competition and business strategy development that helps to shape every industry to
determine an organization weaknesses and strengths. There are five stages in this model,
which is threat of new market entrants, the threat of substitutions, Supplier Bargaining Power,

Threat of buyers, The degree of rivalry.
Threat of new market entrants — Deliveroo have low threat of new entrants because to start
a new business is more difficult for firm, this is the online firm so requirement of investment is
huge as the new entrepreneur cannot expand the business easily.
The threat of substitutions — This is the biggest threat for the firm because there is huge
competition in the online food industry (Thornton, and Klyver, 2019). Thus, Deliveroo use the
vehicles when they deliver the product. On the other side, uber use the car for deliver the
services so Uber is using the high technology while they serve their services to the customer.
So, the Threat of substitutes product is high.
Supplier Bargaining Power — Deliveroo business is mostly depended on employee because
they provide the product and services to the customer and in this industry the bargaining power
of employees is high, they want high salary. Thus, the bargaining power of suppliers is high.
Threat of buyers — Deliveroo used the low pricing strategy that this strategy helps to attract
the customer. Thus, accordance with low pricing strategy customer are loyal towards the
services because the bargaining power of buyers is low due to low prices on the product. On
the other side, for using the high quality of products buyers can easily switch and used another
app that can be done through different app which is installed the app in phones so customer
using 5 stars hotels services.
The degree of rivalry — Deliveroo face lot of competition in this market. Thus, there are lot
of competitors such as just Eat, Grub Hub, UberEATS and Hungry House the online food
delivery industry they provide more quality product as compare to the Deliveroo (Arcot and
Gröschl, 2019).
Crossing the CHASM
This is defined as an innovative approach that defined the way to have high tech selling
of the commodities. With the help of three approaches the Deliveroo became capable to achieve
competitive advantage within market. Henceforth, these defined in following manner as are-
 Redefine customer needs- This entity take place in the market with help of identification
of the customer needs. There were lack of option relate to this services. Henceforth, by
undertaking steps to analyse the needs and wants of the customers entity become capable
to gain competitive advantage (Asah, Fatoki and Rungani, 2015).

 Drive word of mouth- It is an advertisement tool that aids to get interact with potential
customer. Therefore, this is defined as promotional tool that aids to spreads the
information about the product and services in the market from one person to another. It
can be done with help of innovation and by delivering quality services to customers.
 Target the right niche- It is subgroup of firm that mainly targeted the audience. For this
services, the entity has targeted the customers who stays away from their house and work
somewhere. This innovation has attracted them and they acted as word of mouth to firm.
Competitor analysis
This is defined as strategy that involves positioning a firm enhance their services in order
to take the competitive advantages (Bird, 2019). Therefore, the main of the competitor analysis is
to develop and launch new ideas that leads to get success to the enterprise.
How business improved itself in the face of the competition?
This is entity that came up in the market with new innovation that aids to gain
competitive advantage to the enterprise. There were very lack firm that provide this kind of
delivery services. So, this was new to customers of UK.
Why Deliveroo beat their competitors.
This entity has many competitors as UberEats, just eat etc. Henceforth, Deliveroo is
competing with their copycats by providing much efficient and faster services to the customers.
Thus, Deliveroo has taken various initiatives to use network of the riders in more efficient
manner (Castaño-Martínez, Méndez-Picazo and Galindo-Martín, 2018).
Who is Deliveroo?
It is a firm that is engaged in online food deliver services that has founded in 2013 by
Will shu. Therefore, this entity serve as intermediary between customers and restaurants.
Where are they in the market?
This entity situated in London, England, UK. Therefore, the services of this entity served
within the area as Netherlands, Germany, France, Spain, Italy and Kuwait etc.
What do they offer?
They offer online food delivery services to the customer at their doorsteps.
Why do customers choose them?

They are the innovators of providing online food delivery services. Thus, this enterprise
is capable to provide efficient and fast deliver to customer by tracking the networks of their
employees (Chakraborty and Gupta, 2019).
Value chain analysis
This is defined as process of making the product for the purpose of satisfied the customer
there are two activities primary and support activities. It helps to provide the product to the
customer by using the different distribution channels. Thus, its defined in following manner as
are-
Primary activities
 Inbound logistic- This is inclusive of range of activities like receiving, storing and
distributing good and services for operational resources.
 Operations- The quoted enterprise works as to operate its activities as to deliver food
services at the doorstep (Chetty, Ojala and Leppäaho, 2015).
 Marketing and sales- Deliveroo has used Word of mouth as promotion tool. This aid
firm to market the product and services.
 Outbound logistic- It is firm that perform service as to being outbound logistic. Thus,
workers perform their activities as to collect and deliver the commodity to customers.
Support activities
 Technological development- In the present scenario, the food deliver sector has been
marked by the intense competition between various players. It is the firm that has used
technical advancement in effective manner.
 Human resource department- The HRM of this enterprise hires the skilled labour
workforce so that they can provide prompt services to customers. By providing the
regular training the whole workers can perform at their best level.
 Procurement- This is enterprise that act as environment friendly. Thus, this firm has
necessary material, machinery and other consumable items.
PESTLE at entry
Pestle analysis — It is the tool that helps to identify the macro environment of the firm. Thus,
this factor is the framework or tool used by the business to analyse and monitor the macro-
environmental factors that this factor is created negative and positive impact on the firm

performance. There are different types of factors such as Political, Economic, social,
Technological, legal, Environment.
Political - This factor impact the government rules and regulation by analysing that from which
way the decision of the business is being effected This factor is describing that How
government rules and regulation is influenced the decision of business it includes the different
factors such as employment low, government low, tax policy etc.
Deliveroo provides the employment opportunity to employees that they follow the labour
low and provide the safety to employees it creates the positive impact on the employment ratio
also government support the online food market to expand their business in new market. Thus,
the political factors impact the Deliveroo.
Economical — This factor is determining the different economic issue. It includes the interest
rates, exchange rates, economic growth, inflation rates, customer income, Deliveroo face some
problem employee crisis, so employees are leave because of economic reasons like the
weakness of pound is creates the negative impact because the pool of workers is reduced as
they are not remained work in the UK.
Social — This factor is considering the Beliefs and attitude of society and consumers. It
includes the living of standard, consumer buying behaviour, lifestyle attitudes, income class,
education attitudes, health and safety relates issues, cultural barriers etc. According to the
Brexit issues, the workforces is leaving the UK and firm cannot meet the demand of consumers
timely. Thus, it creates the negative impact because low number of employees are not meet the
demand of consumers. Thus, also the new suits of pay are affects the Deliveroo is facing issues
relates to PR crisis because new workers are not joining the company as quickly to meet the
demand. On the other side, company work with effectively as they provide the healthy foods to
the consumer, so the demand of product is always high it creates the positive impact, due to
negative point the demand of firm’s product is not affected
Technological — This factor is described that by using the new technology in the business it
may affect the business operation of the business . Thus, Innovation in smartphone technology
has enhanced the growth of 21% in the age of 16-24 group uses services like Deliveroo when
ordering food take out. Thus, the new technology is creating the positive impact on the
performance of the firm because Deliveroo develop the custom app that helps to their operation
it allowed Deliveroo to create a low-maintenance workforce and the turnover of employees is

less because it can be easily communicated through one app. On the other side, to develop the
new technology in the business it enhances the training expenses because firm require the IT
team which manage the websites and order of the customer (Chakraborty and Gupta, 2019).
Legal — This factor is describing that the government laws and act is affects the performance of
the firm. It induces different factors such as anti-discrimination act, equality law, consumer
protection law, employment low, health and safety laws etc. Deliveroo are facing problems
related that employed are not satisfied with the wages it increase the discrimination lawsuit that
means to hundred employee are not joining because thy claim to the company that enterprise
fails to provide wage, also firm cannot provide the holiday pay and also they judge their
employee on the age discrimination basis. Thus, employee forced to improve the pay or terms for
its self-employed couriers, the company’s production and operational cost could increase
dramatically so it creates the negative impact on the firm performance. On the other side, firm
follow the consumer protection act that means this act is increase the loyalty of customer. Thus,
customer is attracted when organization follows all rules and regulation related the services. So,
by following the consumer protection act impact positive on the performance of the firm
((Eijdenberg, E.L., Paas, L.J. and Masurel, E., 2015).
Environment — This factor is describing how organization follow the rules and regulation of
the environment that they not affect the environment in any ways (Goel, Jones and Karri, 2019).
It includes the different environment changes which environmental offsets and climate change
and weather etc. Deliveroo support the environment by using the bicycles and scooters. Thus,
using this Deliveroo servethe environmental friendly goods in order to reduce backlog and
pollution when as compared to using the cars and other delivery vehicles it creates the positive
impact that society and government support the firm. On the other side, Deliveroo actively works
to help and take initiatives to support businesses and other activity so customer easily attracts
toward the company profile but there are some political issues which affects the performance of
the firm (Eijdenberg, E.L., Paas, L.J. and Masurel, E., 2015).