Coronavirus is evil but it also did something that we wouldn’t believe even if we were told it was going to happen. The virus locked people in their homes making them dependent on on-demand delivery apps more than ever. We witness today what is called the on-demand economy and this trend is gaining more and more acceptance in societies.
Whether it’s good or bad, it’s another story. One thing is clear. It opens new possibilities for businesses. Lots of startups are keen to launch on-demand delivery apps. If you are one of them, this article is just right for you.
We will cover the following topics:
- What is an on-demand delivery service?
- Steps to create an on-demand delivery app
- The cost to build an on-demand delivery app
- How does on-demand delivery work?
- Ways to make money from a free app.
Let’s get started!
What is an On-Demand Delivery Service?
Consumer behavior has changed. A lot of consumers expect speedy deliveries and even are willing to pay a higher price for convenience. They now know they can get what they want and wherever they want.
These expectations are met by on-demand delivery services. Businesses apply modern technologies to supply their products to their customers ‘’on-demand’’. This is not what commerce used to be just a couple of years ago.
Օn-demand delivery service is a service when companies supply their goods to their consumers in a short time and at their convenience. They apply modern automation, software, and data analytics for service delivery.
Most companies work 24/7 and expand their markets at a faster speed. Technology is often applied to analyze customer preferences and adjust the business to their needs.
A lot of companies have automated the process. They use improved hardware and on-demand cloud computing for processing orders.
Օn-demand delivery service is often cheaper than traditional commerce because it utilizes fewer resources — both human and physical. Due to this, the price is more affordable for the consumers, which allows companies to be competitive in the market.
And one more thing… On-demand delivery services can build loyal customers. That’s why businesses are concerned about customer satisfaction and build their work accordingly.
Steps to Create an On-Demand Delivery App
What steps to take to create an on-demand delivery app? Does this question arise in your head? It may if you are thinking about getting into the real business. It’s very hard to push your job forward if you don’t have an on-demand delivery app. If this is so, let’s see what steps you should take.
Step 1. Validate the idea
Even if you have the smartest idea, you need to test it in the market.
- Does it meet customer demands?
- Does it add value?
- What makes it unique?
- Why would a customer buy your product instead of your competitors’ products?
You need to have clear answers to these questions before you launch your product in the real world.
Step 2. Features
There are some basic features you need to include in your app. However, get creative. Ideas rule. They are the king of the market.
Here is a basic list. You need to add to this to sell.
- Real-time tracking
- Payment gateway integration
- Reviews and ratings
- Push notifications.
Step 3. Hire an experienced outsourcing company
You need to hire an experienced outsourcing company even at the stage of validation and testing of your idea. A good Minimum Viable Product or MVP is what the company will develop for you. When you receive feedback from early adopters, sit with your team and analyze it. Go through each opinion as this may be a source of valuable information.
Once you are ready, an experienced outsource company can build your product and launch it in the market.
The Cost to Build an On-Demand Delivery App
Do you want to build a video-streaming app? A food delivery app? A healthcare app? An app like Uber?
The type of app and its complexity are determining factors for your app cost.
Naturally, the number of hours spent on app-building will raise or lower the cost. To have a clue of how many hours you need to spend on your app-building, have a look at this list.
Customer app — 603 hours
Courier apps — 457 hours
Restaurant apps — 182 hours
Admin panel — 257 hours
Design — 330 hours
Project management — 500 hours
Quality assurance — 800 hours
DevOps — 220 hours
If this clarifies the number of hours for your specific case, let’s get to another issue. How much will you pay per hour?
It depends on where you hire the developers. Here is a chart of the hourly rate of developers in different countries.
As you can see, India offers developers at the lowest hourly rate. Another option is to consider an outsourcing company in Eastern Europe like Armenia. You can find competitive quality here at reasonable prices.
How Does an Online Delivery App Work?
We will take the example of an online food delivery app to see how it works.
The whole process is super easy. The customer chooses his/her favorite dish and orders it online. You need to process the delivery at least in one hour as this is the expectation of most customers.
You can act either as an aggregator or a platform for logistic support.
Aggregators are very popular nowadays. Examples are UberEats, Deliveroo, GrubHub. In this case, you act as an online meeting point for eaters and restaurants. This is a beneficial business for both the aggregator service and the restaurants. Restaurants get extra orders without overloading their space. They also become known by the aggregator’s audience. On the other hand, the aggregator does not invest in cooking space or meal making while making money just by the delivery service.
If you decide to act as a platform with logistic support, you need to get involved in the whole process, including cooking and delivery. You need to hire full-time couriers to make deliveries to customers. This is a more complicated approach and works well for well-known restaurants.
The same logic works for pharmacy delivery services where you don’t have to physically travel to the pharmacy location. Instead, you get your medication delivered directly to your place. There is some cost associated with this as customers need to pay for the delivery cost.
Ways to Make Money from A Free App
Yes, apps can be free and you can still make money. Here is how it works.
In this case, the users buy products on the app but the transaction is processed by the store. The app owner gets a commission from each transaction.
You can promote someone’s application or products in your app and earn a good income from this service.
Normally, when there is a possibility of trying the app for free, users download it. Later, if they like the functionality, they can buy premium.
Be aware that your ads should be appropriate to your app topic. You can get money every time a user clicks on an ad or sees it. Some ads pay money only if the users buy something or every time the user installs an advertised application.
Yes, it’s time for the on-demand economy. Building an app for your business will put you into a competitive advantage over others. For sure you need to hire an outsourcing company that has the knowledge and experience of building on-demand apps.