The food delivery landscape in Hong Kong is set for increased competition with the exit of Deliveroo, leaving foodpanda and Keeta as the remaining major players. Industry experts suggest that while the rivalry between these two platforms will intensify, price hikes are unlikely in the short term.
Speaking on a radio program on Tuesday, Simon Wong Ka-wo, president of the Hong Kong Federation of Restaurants and Related Trades, cited the shrinking market for food delivery services post-Covid-19 as a key factor behind Deliveroo’s withdrawal from the city. According to Wong, the share of food delivery platforms in Hong Kong’s catering business has significantly declined, from over 30 percent during the pandemic to approximately 12 percent. This now represents only HK$12 billion to HK$15 billion out of the total HK$100 billion annual revenue of the local catering industry.
Wong also pointed to the entrance of Meituan’s Keeta into the market in 2023, which further pressured Deliveroo. Keeta’s low-cost strategy, including extensive discount offers, has significantly affected the competition in the sector.
Despite these challenges, Wong believes that foodpanda and Keeta are unlikely to raise their fees in the immediate future. Marketing expert Kenneth Kwong Ka-kei, assistant professor of marketing at Hang Seng University, echoed this sentiment. Kwong explained that the two remaining platforms will likely maintain their current delivery fees and commission rates, as they compete for the customer base left behind by Deliveroo.
Kwong also suggested that, given the saturated food delivery market, platforms in Hong Kong should consider diversifying their services, potentially expanding into areas like household item delivery.
In related news, Lam Chun-sing, a lawmaker from the Federation of Hong Kong and Kowloon Labour Unions, revealed that the group had reached out to around 200 Deliveroo employees following the company’s exit to offer support and explore possible alternatives for workers impacted by the shift in the market.
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