Foodpanda on path to profitability, not up for sale, says CEO
Is Rocket Internet-invested Foodpanda up for sale? Who can tell you better than Saurabh Kochhar, CEO of the online food ordering platform. “Foodpanda is not up for sale... We have a sustainable business, we know our unit economics and we do not need anyone to bail us out,” Kochhar said.business Updated: Feb 01, 2016 01:15 IST
Is Rocket Internet-invested Foodpanda up for sale? Who can tell you better than Saurabh Kochhar, CEO of the online food ordering platform. “Foodpanda is not up for sale... We have a sustainable business, we know our unit economics and we do not need anyone to bail us out,” Kochhar said.
Kochhar even said that every order that is placed on Foodpanda makes profits. “Our margins are between 15-25%,” he said. That is the highest in the industry, considering, Zomato founder Deepinder Goyal said in a conversation with HT earlier that his company makes 10% margins on food delivery.
The founders of Foodpanda exited last year. Kochhar, who was earlier with Rocket Internet, was brought in to get the company back in shape, clean it up, and make it profitable, but his journey so far has been far from smooth. Foodpanda, two years ago had acquired two similar sized companies -- Just Eat and Tasty Khanna. When Kochhar joined, the teams were scattered. “We had to integrate the three companies – there had to be one process, one team and one product...That happened over the last year,” said Kochhar.
Foodpanda’s business is to connect the restaurant and the customer over the app. The higher number of restaurants means more choice. But in doing so it often did not delist restaurants that were shut down.
That’s changing. On an average about 100-500 restaurants are taken off the Foodpanda app every month. “Every week we reach out to each of the restaurants on the app, and this process is automated. We also do mystery buying,” said Kochhar, who wants to reach profitability by 2018.
Foodpanda has automated 98% of its order and delivery processes and this has helped Foodpanda reduce refunds, which it had to make due to delivery and order related issues, by 60%.