Deliveroo aims GCC expansion with more dark kitchens

London-headquartered food delivery app Deliveroo has been expanding its services across UAE, Kuwait and Qatar. The company, which forayed into the GCC market in 2016 by setting up shop in the UAE, will focus on growing its network of dark kitchens to power its expansion, said Co-founder and CEO William Shu during his visit to India. 

“The Gulf is an interesting market because many of the restaurants already delivered themselves because of the low cost of labour…Having a completely centralised customer service function, we were able to drive customer satisfaction much higher than either the restaurant alone, or an online marketplace that didn't do their own logistics,” said William Shu of the company’s entry into the market.

He added that Deliveroo’s expansion in the GCC markets, with the addition of Qatar nearly four months ago, is being handled by the team based in Dubai.

“Although it's not a homogenous market across the Gulf, we can leverage existing relationships. The franchises of the Western brands are typically owned by families, and we have relationships with them, and we can help expand,” said Shu to YourStory Gulf Edition. He added that demography however was remarkably different across the countries. 

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Shu counts changing the mindset of customers in the GCC with a service-driven approach as a win for Deliveroo in the geography. “We also built a large number of dark kitchens, which allowed brands to go into neighbourhoods where they didn't have a physical presence. So that was a big part of our strategy.”

He added that expanding the dark kitchen network will be a key part of the strategy for Deliveroo in the market, going ahead.

The company which has been leveraging its hyperlocal strategy with grocery delivery counts the UAE as one of the top markets for grocery delivery orders. In the GCC region, the company competes with Delivery Hero’s Talabat and Uber-backed Careem. 

“The online grocery business in the UAE as a percentage of overall grocery sold is the highest of any market we're in, and the UK is probably the pioneer of that. But because of the labour structure in the UAE, it is relatively cheaper for a lot of these supermarkets (to deliver on their own) (sic),” said Shu.

He added, “What's interesting is they've gotten it to work without a ton of technology, but then adding technology makes things much more efficient. And yes, I would say the average person in the UAE the average consumer in the UAE thinks much more about ordering groceries online, getting it quickly versus almost any other market.”

Founded in 2013 by Shu and Greg Orlowski, the online food delivery company Deliveroo has operations across 10 global markets. The startup is considering adding health and beauty apart from grocery delivery to its repertoire of services, the CEO told YourStory during his visit to the company’s India Development Centre in Hyderabad last month.