Bolt Food gunning for Uber Eats with cheaper prices

Bolt Food is taking the fight to Uber Eats and Mr D Food with an expansion from Cape Town into more major South African cities.

Bolt Food country manager James Townsend-Rose recently spoke to MyBroadband about the platform’s plans in the coming months and how it aimed to differentiate itself from the two dominant food delivery players.

Townsend-Rose acknowledged that Uber Eats had significant market power thanks to its strong brand, while Mr D Food enjoyed popularity for its years of experience in the industry.

He said Bolt Food wants to stand out in one key area – pricing.

“We really saw an opportunity to offer a product that could deliver the same type of brand proposition that our ride-hailing does, and that is one of better value than our competition,” Townsend-Rose said.

This means it is focused on competitive commissions for food providers that will result in better value for money for customers.

James Townsend-Rose
James Townsend-Rose

Food delivery apps generate revenue by charging commission to restaurants, which have to increase prices on food items delivered via the app to maintain solid margins.

Based on previous feedback from their restaurant partners, Uber Eats and Mr D Food currently charge restaurants up to 30% commission.

By comparison, Bolt Food has been charging flat entry-level commissions of 15% for food providers on its platform in Cape Town when it launched in April 2020.

This was part of Bolt’s way of helping restaurants during the tough operating conditions as a result of the Covid-19 restrictions in South Africa.

While Bolt Food’s flat 15% commission structure will change as South Africa’s economy recovers, Townsend-Rose maintained that the service would remain very competitive compared to its rivals.

He said that the service saw tremendous growth over the last few months after gaining traction towards the end of November and December 2020.

Townsend-Rose put this down to increased marketing and PR efforts, word-of-mouth from satisfied customers, and the service’s attractive commission structure for restaurants.

“We’ve seen now, over the last four months, 50% month-on-month growth in Cape Town and we are really excited to launch in those cities that where we planned to launch back in April,” Townsend-Rose said.

While the company initially planned an aggressive rollout across multiple cities, the Covid-19 pandemic and initial hard lockdown put a damper on its ambitions.

Backed by strong growth, it is now planning to launch in Johannesburg in the third quarter of this year.

Townsend-Rose said Bolt Food’s sales team was already talking to restaurants in the city about signing onto its platform.

“It’s a big market for us on the ride-hailing side of the business, which then presents a big opportunity for us in food because we can target the same customers.”

Johannesburg city skyline

After Johannesburg, Bolt Food’s major goals will be to launch in Pretoria and Durban, while continually expanding from the Johannesburg core area and reaching 100% of Cape Town.

This is not where the plan stops, though.

Townsend-Rose said that it would make total sense for Bolt to try and match its ride-hailing footprint in the rest of South Africa, which includes 23 cities and towns.

He also shared some statistics on Bolt Food customer habits:

  • Average order value – R200
  • Most expensive order – Almost R4,000
  • Most popular food type – Burgers
  • The busiest day of the week for orders – Friday
  • Busiest times for orders – Evenings

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Bolt Food gunning for Uber Eats with cheaper prices