Are food delivery services still in favor with catering industry?
When entering a local street restaurant in China, you will probably hear non-stop announcement informing staffs about online orders coming in from takeout apps or e-cashiers. The money burning subsidized promotional approach has helped capital backed platforms win market share among fierce competition, also successfully cultivated connections between users and merchants utilizing the latest technology. However, the days seems to be long gone and the cash reduced to ashes, with investors looking for returns. Platforms, like Meituan and Ele.me, are resorting to price hikes and cost-cutting strategies when facing tight financial burdens, which to some extent squashes small merchants’ experiencing low profitability by increasing commission payments, and losing customers away by no longer offering vouchers.