Online food ordering and delivery service player Foodpanda, which is backed by Goldman Sachs, has claimed that the company has sufficient funds to keep the business going and that talks of a sell-out are untrue.
Online food ordering and delivery service player Foodpanda, which is backed by Goldman Sachs, has claimed that the company has sufficient funds to keep the business going and that talks of a sell-out are untrue. Saurabh Kochhar, CEO, India, claimed that while the firm had received offers, Rocket Internet was not selling. “The management team had been overhauled and we can draw from the global pool of funds as and when we need to,” Kochhar told FE.
Rohit Chadda, co-founder of Foodpanda India stepped down as the managing director in August. Recent media reports said Rocket Internet led companies were grappling with operational and managerial inefficiencies and that there were no takers for the company even at a valuation of $10-15 million.
In FY15, Pisces eServices Private promoter of Foodpanda India reported losses of R36 crore on the back of revenues of R5 crore, according to a company filing with registrar of companies.
Foodpanda is expecting to break even by FY19, Kochhar said. “Our margins are in the region of 15-25% and we rarely give discounts,” he said, adding that it takes seven to ten years for a market place to break even.
In December, the company had announced the retrenchment of 15% of its workforce. The company now has 2,000 employees of which 1,200 work in the delivery team and earn around R11,000-R12,000 per month. The remaining 800 work across the sales, operations and customer support teams.
Foodpanda entered the delivery space in 2015 and according to Kochhar, approximately 25-30% of the deliveries are managed by in-house fleet. The margins earned by the firm on transactions ranges between 15 and 25%, Kochhar said with the average ticket size of an order at around R400-600.
Approximately 80% of the orders are routed via the mobile app with the rest coming via the the web version. Foodpanda has clocked 3 million app downloads till date.
Foodpanda ties up with McDonalds
Foodpanda has become the first online food aggregator company to bring McDonalds on its platform. This is in partnership with Hardcastle Restaurants which owns and operates McDonalds restaurants across west and south India.
“McDonald’s is a beloved brand in India and we are extremely happy to bring it onto our platform. We’re glad to have had the opportunity of being exclusive partners that will allow consumers to enjoy the McDonald’s menu for the first time through an online food aggregator. At foodpanda, we strive to provide unique experiences with hassle free deliveries to our customers as well as provide them with a variety of places to order from and we’re sure McDonald’s® will add great value to our services,” said Saurabh Kochhar, CEO, foodpanda. fe Bureau