Strategic Management Report: Deliveroo Business Analysis

This report provides a comprehensive strategic analysis of Deliveroo, a web-based online food delivery service operating primarily in London and other international markets. The report begins with a business description and then delves into a PESTLE analysis, examining the political, economic, social, technological, legal, and environmental factors influencing Deliveroo's operations. It then applies Porter's five forces model to assess the competitive intensity within the industry. Further analysis includes competitor identification and analysis, a SWOT analysis to evaluate Deliveroo's internal strengths and weaknesses and external opportunities and threats, strategic positioning, market segmentation, and identification of potential market opportunities. The report concludes with a summary of key findings and recommendations for future strategic initiatives. The company faces challenges related to labor practices, competition from established players like Uber Eats and Just Eat, and evolving consumer preferences. The report also highlights the company's strengths in its supply chain, strong management, and the opportunities to expand into new markets and delivery services.

STRATEGIC MANAGEMENT

Table of Contents
Introduction:...............................................................................................................................................1
Business description:...................................................................................................................................1
Pestle:..........................................................................................................................................................1
Porter’s five forces:.....................................................................................................................................4
Competitor’s identification and analysis:....................................................................................................6
Swot analysis:..............................................................................................................................................7
Strategic position and market attractiveness:.............................................................................................8
Market segmentation:.................................................................................................................................9
Potential market opportunities:..................................................................................................................9
Conclusion:................................................................................................................................................10
References:................................................................................................................................................10
Introduction:
It is the report that focuses on the company called Deliveroo. Deliveroo is the web based
business that serves the customers with online food delivering service. The business is based at
London and delivers a great quality of food from some of the local restaurants of London. The
report focuses on strategic analysis of the company and provides some of the recommendations
of marketing opportunities that can be explored by the company (Deliveroo., 2018).
Business description:
Deliveroo is the web based business that serves the customers with online food delivering
service. The business is based at London and delivers a great quality of food from some of the
famous restaurants. The company then moved to various other countries like Australia. The
average delivery time that the company takes is around 32 minutes. The idea behind the start up
of the business is to deliver the quality food to the customers whenever they require the food
from choice of restaurants. As far as the charges is concerned, Deliveroo is the company that
charges flat £2.5 ($3.79), and requires a minimum order of £15 ($22.76). The other way of
earning revenue by the company is commission that the company receives from the restaurants

from whose orders that booked through the application of Deliveroo. Deliveroo is the company
that is transforming the thinking of the people about the food delivery by providing the fast
service and reliable delivery from the premium restaurant of the city (Deliveroo., 2018).
Pestle:
Political factors:
As far as the political factors are considered, it has been analyzed that AUSTRALIA is the
government that supports the practices of online food market in AUSTRALIA. The government
is investigating in employment practices in the online ordering food platforms and minimum
wage should be link with these companies as well (Bortolini, et al. 2016). Till now, the
companies like Deliveroo dies not fall under this minimum wage criteria and thus keeping the
prices very competitive in nature.
Economical factors:
Although the economic condition of London is very stable in nature thus there are some
economic challenges that have been faced by the food sector in AUSTRALIA. As Britain is in
talk with leaving the EU thus Deliveroo is facing the hardships in the context of economy
because of the shrinking of pool of workers (Deliveroo., 2018). For the food takeaway
companies, AUSTRALIA leaving the EU market results in extra cost and the idea of
AUSTRALIA leaving the EU may lead to more uncertainties in the economy of the country.
Social factors:
Because of brexit, the workforce is leaving AUSTRALIA and thus the companies like Deliveroo
that requires a lot of workforce are facing issues. The company is looking for students and the
labor. Due to poor crisis of Deliveroo, it has been analyzed that most of the labor are not joining
the company. The company has undergone the investigation by the relevant department because
of the low safety concerns of the labor (Bortolini, et al. 2016). Deliveroo is the company that is

deliberately working with the restaurants that serves healthy food because of the change in the
culture of eating and the demands of the customers.
Technological factors:
As far as the technological innovations are concerned, it has been analyzed that most of the
people these days are using the smart phone technology to a great extent. This innovation leads
to use of food delivery applications by the users. AUSTRALIA has experienced 21% of the
growth in the use of food delivery applications in the age of 16-24.customixation of the
applications is also a great innovation for the companies like Deliveroo to offer great services to
the socialized customers. Deliveroo is also making use of the innovations in the technological
sectors by developing automates kitchens that directly communicate with the application orders.
This results in cutting of the middle men for delivery volume to increase by 500%.
Legal factors:
Deliveroo is facing issues in this context because of not meeting the minimum wage criteria.
There are some other legal obligations that are also not followed by the company such as holiday
pay, age discrimination etc. These obligations suggest that the company needs to improve its
practices and they should follow the legal terms and lawsuits of AUSTRALIA and London.
Environmental factors:
In order to be sustainable and environment friendly, the company focuses on the using the fleet
of bicycles and scooters. This suggests that the company contributes in reducing the pollution of
the place (Financial Review., 2018). Deliveroo actively works with local European authorities to
help develop and communicate initiatives to support businesses and the potential impacts of
climate change.

Porter’s five forces:

Threat of new entrants: threat of new entrants refers to the difficulty that the already existing
companies face due to entry of new companies in the industry. As far as the case of Deliveroo is
considered, it has been analyzed that the threat of new entrant is high to medium. This is because
the new companies can easily enter this industry because of low investment.
Threat of substitutes: threat of substituted can be low to medium. The only substitute to these
delivery companies could be the food restaurants themselves can start their own delivery
services. Otherwise the threat of substitutes is very low as people require take away facilities all
the time in AUSTRALIA (Bortolini, et al. 2016).
Bargaining power of buyers: bargaining power of buyer so high these days because there are
many other companies that are serving the customers with the food delivery services. Even the
restaurants these days have started their own services of delivery. Buyers have many options to
order their food and these results in high power of bargaining of the customers.
Bargaining power of suppliers: this is the aspect that refers to the bargaining power of the
suppliers. This remains high when there are many buyers and less suppliers and remains low then
there are fewer buyers and many suppliers. In this case the bargaining power of supplier is very
low. This is because the suppliers or the food restaurant are large in number in all over Australia
and they have to be in contact with the delivery service to reach the customers. Only dine in
facilities cannot results in high profits for the restaurants because of the take away services
(Financial Review., 2018).
Threat of rivalry:
Deliveroo is one of the services that has been entered the industry of online delivery food
services. Other competitors that have been analyzed in this sector are UBER eats. It is the biggest

competition for Deliveroo in Australia. As entering this industry is not that much expensive this
competition in this industry is very high in nature.
Competitor’s identification and analysis:
There are various competitors in the industry of food delivery services. UBER eats is one of the
competitors for Deliveroo that is giving tough competition to the company there are several other
competitors as well that are discussed below in brief:
UBER eats:
As far as UBER eats is considered, it has been analyzed that it is the firm that does not have the
requirements for its marketing as the company is already famous and popular enough because of
its taxi services business. The major positive aspects of using this application is that it helps the
customers provide the live feed and thus the customers can identify that when their food reaches
them. The customers can also contact the drivers (Rctom.hbs.org, 2018).
Just eat:
Just eat is also the service that is used by most of the customers in London. It has been analyzed
that it is the service that provides various restaurants offers and also provide many discounts to
the first users. The marketing strategy of the company is very efficient and offers and
discounting techniques helps the company to serve the market easily and also helps in capturing
new market.
Amazon restaurants:
Amazon has also started its new services of delivering food in AUSTRALIA. Amazon also has
the upper hand in terms of popularity as it is already very popular application in AUSTRALIA
and other places in the world.
Other than the above competitors there are various other competitors as well such as door dash,
prostates, instacrats etc. That makes the industry more competitive in nature.
Swot analysis:
Strengths: Weakness:

 Strong management – the company has
started by two of the founders in which
one is investment banker and other is
software director. The strong base of
management helps the company to
avoid all the hurdles in the initial stage
of their business. Will shu the software
director co-founder have successfully
coordinated with a giant technology
fund to negotiate a $275m investment
into the company (NewsComAu.,
2018).
 Supply chain – it has been analyzed
that the company’s supply chain is its
strength. By the great partnerships with
the kitchens and the restaurants, it
serves the market of all over Australia
with great services. This means the
kitchens, delivery drivers and
Deliveroo employees each support the
weight of Deliveroo equally
 Branding issues – in the year of 2016, it
has been analyzed that Deliveroo
rebranded its entire company in order to
stand out of the competitors. The
company has very low brand value and
thus it affects its business.
 Technical malfunctions – Deliveroo is
the company that is solely based on its
application services and thus it has
faced so much of technical
malfunctions tell now. Deliveroo faced
heavy criticism for their lack of clear
communications and poor customer
support (NewsComAu., 2018).
Opportunities Threats:
 New food trends – the company has
the great opportunity of amplifying its
business in order to serve the market
with healthy food and take away
options. Now the company can act as
the substitute for cooking the food at
home.
 New partnerships – to expand out from
 High competition – since the
commencement of Deliveroo rivalry
has grown to include companies like
just eat, grubhub, UBER eats and
hungry house. In addition, in 2016
Amazon have launched their new
delivery service with the advantage of
'free one-hour deliveries' to weaken the

the highly aggressive food market, in
2016 Deliveroo became the first
conventional app delivery service to
offer alcohol deliveries. The company
has partnered with Heineken and it is
the first brand that serves the market
with alcohol delivery service.
(NewsComAu., 2018).
competition
 Changes in food tastes: as the change
in the food trends has been observed in
the market thus it becomes difficult for
the company to serve the market needs.
Changing taste of the market thus act
as the great threat for the company.
Strategic position and market attractiveness:
As far as strategies position of the company is considered, it has been analyzed that the company
focus on market penetration strategy by using more and more marketing strategies to become
popular in the existing market. It this competitive advantage of the company and thus it is
penetrating the market with full zeal by launching many marketing campaigns and providing
promos codes to the people.

Market segmentation:
The above figure suggests that Deliveroo is the company that deals with serving the customers
only on demand. Thus, the market segmentation of the company has been done on the basis of
the way people prefer to prefer to order the food.
Potential market opportunities:
 Serving the customers with other delivery service such as delivering the daily
requirements items from some of the supermarkets. Delivering the daily needs products
to the customers on demand etc. This opportunity helps the company to expand in the
different sector and also helps the customers to take more and more services from
Deliveroo.
 Another market opportunity that can be explored by the company like Deliveroo is to
innovate their application and provide the reviews of the restaurants nearby areas of the
people so that they can reach and eat there.

Conclusion:
It is the report that has conclude that Deliveroo is the company that serving the market with food
delivery service. The company has great competitors in the market such as UBER eats, just eat
etc. Thus, the company needs to expands its business and explore the opportunities that are
available in the market. The opportunities like delivering other products and reviewing of the
restaurants can explore more doors of business for the company.
References:
Bortolini, M., Faccio, M., Ferrari, E., Gamberi, M., & Pilati, F. (2016). Fresh food sustainable
distribution: cost, delivery time and carbon footprint three-objective optimization.
Journal of Food Engineering, 174, 56-67.
Deliveroo. (2018). Deliveroo.com.au. Retrieved 25 March 2018, from
Deliveroo. (2018). Deliveroo.ie. Retrieved 25 March 2018, from
Financial Review. (2018) Deliveroo to launch in Australia after $140 million capital raising..
Retrieved 25 March 2018, from
NewsComAu. Is (2018). this the end of dining out?. Retrieved 25 March 2018, from
Rctom.hbs.org (2018) Deliveroo: When Fine Food Meets Exceptional Logistics – Technology
and Operations Management. Retrieved 25 March 2018, from