Weiwei Lai

Business Analyst

April 3, 2014

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Supersonic Food Delivery – How Brands Are Boosting Delivery Service In Asia

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Delivery services now play a crucial role in the growth strategy of the largest fast food brands in Asia, as many urban dwellers and office workers prefer to have food delivered as a way to save time and hassle involved in visiting the actual locations. 

As brands like KFC and McDonalds increasingly rely on delivery services to expand business in large overcrowded cities with high real estate costs, having the most efficiently planned delivery routes and systems becomes critical to success. And with competition heating up in Asia, brands are looking for ways to take their delivery services strategies from fast, to supersonic.

A strategy toward streamlining delivery routes typically begins by brands answering the following questions:

1 – What market area will our delivery business cover?

This generally refers to the geographic zone or “area” containing the people who are likely to purchase a brands goods or services. In this case, the people who call in for delivery.

2 – How should we segment market areas into different delivery times / distances?

How much segmenting needs to take place will depend on the size of the market area to begin with, but generally, most market areas will need to be broken down into at least a few different delivery time segments in order to understand which location can best service the delivery.

3 – How should we define a target delivery store when an order comes up?

This will be aided by analyzing the segments that are created in the above step.

4 – What’s the quickest route for a delivery employee to get from the store to customer?

This is usually easiest for brands to do when the created segments, market areas and locations are all visualized over a map.

Answering all of these questions thoroughly and accurately can often take brands considerable amounts of time, but with the right data and analytic processes in place, solutions can be created that inevitably cut down cost for brands in both time and money spent while answering these questions accurately.

Determining delivery times

Creating the most accurate delivery times to apply to mapped out delivery routes is important for creating a food delivery process that goes beyond being just “good”.

Think of a fast food brand with 3 stores existing in one market area.  Total delivery times for each store can be separated into 2 parts. One is cooking time the other is delivery time. If we assumed cooking time was a standard 15 minutes across the store network, and delivery times were broken into 3 time brackets (10mins, 15mins and 20mins), then the average available speed of delivery would be 15km per hour.

Since each store is having total delivery times of be 25mins, 30mins and 35mins, delivery distance would then be 2km, 3km and 4km. Therefore, the shortest delivery time would be 15mins and longest time would be about 35mins.

Here’s a step-by-step guide for doing this method of calculation:

Step 1 – Define segments of delivery distance

Each store can be given 3 delivery distances: 25mins for 2km, 30min for 3km and 35mins for 4km. Setting these times for distance will help manage customer’s expectation on the delivery time better.

Step 2 – optimize overlap areas to nearest stores.

Step 3 – geocode customer locations to identify target store. 

Step 4 – Define the prime route for delivery personnel

Defining the prime route will help delivery personnel save time when finding the delivery location. Even when there are several customers in the same target store delivery area, you can also solve a vehicle routing problem.

Industry numbers point to a steady growth of delivery service in the fast food sector, those looking for a competitive edge will be looking to rethink their strategies so they can take their delivery services supersonic.

Also worth reading: 
Infographic – Health Food Trends in China
How To Find The Right Mall For Your Brand
7 Popular Chinese Brand Chain Restaurants In China

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