Strategic Management project on

SWOT Analysis of Foodpanda

Group 16 - 20

1. Shashank Maheshwari
INTRODUCTION
Foodpanda is a mobile food delivery marketplace
owned by Berlin-based Company and operates in about 50
countries.

In India it was acquired by cab-aggregator Ola.

SWOT Analysis:
In the business world, seeking profit is not the only
motive. It is significantly essential to have a healthy
and favourable business environment. Moreover, to
assess whether your company is working as
efficiently as possible, one of the most effective
method is SWOT Analysis

SWOT Analysis stands for Strength, Weakness,

Opportunity and Threat. It helps the businesses to assess their
position and prepare a plan, according to the internal and external
stimulus.

Objective:
 To have an abstract of an internal and external factors.

 To identify key itemsfor the management of the organization,

which involves establishing priorities for action.

 With the help of SWOT Analysis, we can identify the upcoming

opportunities which can strengthen the company. Further, such
analysis highlights areas which need attention and possible threats
which can impede the company's growth.
 It helps to prepare strategies to minimise risk.
 It assists in exploring new initiatives, revamping internal policies,
considering opportunities to pivot or alter a plan midway through
its execution.

SWOT ANALYSIS OF FOODPANDA

 STRENGTHS:
 Excellent Platform -Foodpanda process various orders
for the customers and sends them directly to the partner
 restaurants. Once the order is processed, it delivers it to it
customers. It acts as a path through which products reach its
consumers.

 Online orderings - Foodpanda allows you to place orders

electronically through your mobile. It connects customers and
restaurants, thus solving the problem of place hindrance. To
have an online ordering system makes the day to day
operations moreefficient. This leads to an exponential increase
in the total sale value per order.

 Investments- Foodpanda has raised a venture capital of

$318 million. It had raised about $20 million in the initial
funding from Rocket Internet and Investment AB Kinnevik
during the year 2013. During the same year, iMENA Holdings
had invested about $8 Million. It had also received another
funding of about $20 Million during the year 2014. Goldman
Sachs had also invested about $100 Million in Foodpanda. All
 these fundings are, in fact, a huge strength to the company, as
the emerging markets represent the largest opportunity in
online food delivery.

 Global Operations – Foodpanda has its business

operations in various countries in Eastern Europe, Middle East,
and Asia. The company has also increased its market presence,
which proves to be a strength that reinforced brand popularity
and truth of many.

 WEAKNESS:
 Reach of delivery-Even after having such wide coverage
in the country, Foodpanda failed to incorporate maximum
restaurants under it. The food delivering business made efforts
to capture the entire/(maximum) market but made minimal
efforts with the restaurants to get them partnered with it.
Orders are only available from restaurants that are in the zone
of the order placed.

 Customer care service– Foodpanda failed terribly to

communicate on cancelled orders, online booking of tables,
cancellation of the tables, etc. to restaurants, consumers and
delivery persons. Their prompt actions and miscommunication
pulled the business down to the ground. Moreover, their
customer support service had no idea of what was going on
with the placed orders. Instead of guiding the consumers the
service itself required the support.
 TopLevelManagement– The top level management was
not ready to take the accountability of the problems going on in
their company. Instead of changing their plans and reforms, they
decided to leave the organization until it was taken over by Ola.
LaterOla decided to fire more than 40 mid level employees and
more than 1500 delivery guys contract were cancelled which
somehow pull down the company’s name.

 Interface– There were many glitches on foodpanda app. It

lacked operational efficiency and was not at all user friendly.
Users found putting in their required details very difficult.
 The app even faced connectivity issue to operate on wifi. Mostly,
the app operated on data connection.

 Non- satisfaction of employees - Payment of

salaries was not made to employees for many weeks. They
wereonly given false assurances. It led to a widespread
disturbance within the company andmany workers even went
on a strike.

 Tap on thefreedelivery- With free deliveries Foodpanda

thought of covering the maximum market. But giving so
manydiscounts the company incurred huge losses,that even the
money for the investment was used to pay off the working capital.
This hampered the growth.
 Crave Party -The campaign was aimed to celebrate the
universal love for food that ties all the foodies in the
countrytogether. However, selling at prices such as desserts
starting from Rs.9 to a Biryani at Rs.79 only increased their
amount of losses day by day.Their motive was to provide
customers with the best food experiences on their platform.
However, due to late delivery service, no information on
ordered food and losses, although offering food at cheaper
rates failed miserably.

 Opportunity:
 GrowingMarket– There seems to be in the right fit as in
the growing market there is the possibility of potential
 customers. With the growingmarket new policies can be formed
and there is always a chance for the business to do well.

Customer Expansion– Foodpanda must expand its

horizon to meet more customers’ requirements. To survive in
this competitive market many restaurants plan/wish to tie up
with online platforms.

 Popular Brand– When Foodpanda was launched, there

were only handful of delivery start-ups and gaining popularity
among customers was quite easy. Since Foodpanda is very
popular gaining customer loyalty again would not be a very
difficult task.

 Expansion– Foodpanda boughtmany small scale businesses

and startups, which is the great way to expand their portfolio of
cities in which strive to deliver.
Threats:
 Increasing Competition-Number of potential
competitors were rising major being Zomato, Swiggy, Glovo.

 Limited Capital – As food panda was comparatively old

start up to others, it hasexhausted most of its capital and isnot
in position to compete with new companieswhich are giving
huge promotional discounts to the customer.

 Low customers– At that time number of loyal

customers were less and most customers were attracted to
companies providing huge promotional activities and discounts.
 WHY FOODPANDA FAILED IN
INDIA?
At the beginning of the decade, Foodpanda was founded across the
Asia Pacific and South East Asia, covering Europe, Thailand, Malaysia,
India, Philippines, and Malaysia. But by the middle of this decade,
Foodpanda has lost its image in the global market. In 2014, it sold its
Delivery Club business to Russia for $100 million, and in the same
year, the German Delivery Hero acquired the Foodpanda group.In
2017, the Foodpanda was acquired by Ola in an all-share deal. Since
then, the business of the company has grounded; Ola fired hundreds
of employees from Foodpanda in 2017, hinting at an imminent
financial crisis.

Several reasons contribute to the failure of Foodpanda, like fake

restaurants and orders, miscommunication, technical faults,
unstructured business model and lack of ownership. Rohit Chadda, his
brother Mohit Chadda quit the company in August 2016, and few
people knew this. The employees of the company were not aware of
the ongoing matters, they were receiving calls from the customers
and upon not delivering food they would give free vouchers to the
customers.

The number of fake customers increased as these kinds of free

vouchers were lucrative to them. How did this happen? The loophole
was that the company did not follow up with either the customers or
the restaurants. When a customer is selecting a restaurant from their
site, it was rather a transaction between the customer and the
restaurants.Foodpanda had no clue about the order. This way, several
restaurants and customers exploited the company and contributed
to the failure of Foodpanda.

Foodpanda often failed to communicate with the customers and

restaurants. Many times the customers would call the restaurants
directly to enquire about the delayed delivery, but the restaurants
were not informed about their order placed on the app. Foodpanda
did not communicate on cancelled orders, their prompt actions and
miscommunications pulled the business down to the ground.

Following the path of Zomato, Foodpanda decided to buy tablets and

give them to the restaurants, so that when an order is placed on the
company’s site, the order will be visible to the restaurant as well.
Abhishek Mandal, Head of operations of Just Eat India, a company
acquired by Foodpanda, gave a quotation of Rs 10,000 per tablet.
But soon after, Mandal was replaced by Shray Gulati. By another
former official who prefers to be anonymous said,‘What we do know
is that when the tablets arrived, they were neither of the ordered
specification nor in the ordered quantity. Also, they had been bought
at a huge mark-up, around ₹ 20,000 per tablet, from a vendor in
Nehru Place’.

There were only problems with Foodpanda. Nothing worked

properly, one can find loopholes everywhere and the higher
authorities were nowhere to be seen. From the mistakes of this
startup, there are some valuable lessons to learn.
 Structure and a business plan are essential: How to run the
business? How to determine the authenticity of the restaurants
and vendors? Nothing was planned for Foodpanda. Launching
the app and promoting commercials will not help in business
growth. Both the restaurants and customers were unhappy due
to the utter mismanagement in the overall approach.
 Nothing is possible without communication: The customers,
Foodpanda and restaurants, these primary three elements were
not aligned as per communication. No initiative was taken to
improve the communication thus leading the customers opting
the other sites.
 The company’s ownership was blurred: Rahul
Chadda(former co founder) and Mohit Chadda quit the
company without making any efforts to undo the damage that
have already been done. Simply leaving the company and not
making any effort to improve the situation did no good. Ola did
acquire Foodpanda, but the condition of Ola is itself volatile at
present.

REVIEWS OF CUSTOMERS
Prospective strategies
 Interface app working
  We shouldfocus on enhancing the usability, accessibility,
webhosting, content structure and designing of our app.
 We should choose proper app developer team and our main focus
should be on meticulous and user friendly interface.

 Wide Selection
 The brand should provide wide selectioneateries. It should
provide various selections of eateries at the nearby location and
with an extensive menu available there. It should also show you
the eateries based on your preference, whether vegetarian,non-
vegetarian,vegan and eggetarian.

Customer support service

 It should provide 24X7 customer support service.
 The person attending the customers should have a basic
knowledge of Hindi and English and he should also know the
native language of the state where he belongs to.

 Proper training of employees

 Proper training to employees should be imparted and they
should be trained in the field of mannerism,punctuality,and
proper communication skills, and the person handling the
customers should be polite and should consider customer as
their first priorty.

 Proper remuneration to employees

  The company should provide their employees with proper
remuneration and alongside they should provide them with
good medical care and should also implement some employees
benefit scheme.

CONCLUSION
As we all know, the consumer is the ultimate king of the market and
satisfying their unlimited conditions is a tough job for every
business. Just like every other business, Foodpanda is one of the
prominent food delivery companies which faced its share of ups and
downs. Ordering food online is a click away and builds up
expectations from the customer’s side, that they will get their food
in time. Foodpanda, however it failed to build upon this trust owing
to its multifaceted problems with its mobile application experience
and delivery partners. It is prudent to stay in sync with the pace of
the highly – dynamic market and make business decisions that
complement the demands of the customer base. Due to the reasons
like miscommunication, technical faults, and lack of customer
services caused the failure of Foodpanda.Further, more then no
initiative were taken to improve these issues hence, it incurred high
losses. The company could have grown by using its opportunities as
there were few delivery start-ups, when Foodpanda was launched.
Foodpanda could have taken first mover advantage but it failed to
do so.