The coronavirus pandemic gave a boost to delivery apps in Latin American countries as schools suspended classes and more people started working remotely in the second half of March.
Simultaneously with the increase in demand, the companies that operate these platforms have started to adopt several actions to combat the outbreak and protect small restaurants, couriers and customers – and, by extension, protect their business model.
LABS has contacted the biggest players in the region to learn more about these measures and how they see and cope with the increase in demand:
Brazilian iFood created a fund for couriers with the initial amount of BRL 1 million to support those who need to remain in quarantine, on suspicion of Covid-19 or because they are part of a risk group. The courier will receive from the fund an amount based on the average of his or her earnings in the last 30 days, proportional to the quarantine days.
iFood sought solutions to mitigate the economic impacts for the restaurants registered on its platform, with actions that are valid from April 2 onwards, for example by allocating BRL 50 million of its revenue in the form of a restaurant assistance fund, with a special focus on small shops. The company will anticipate receipts from restaurants, at no additional cost, to improve cash flow. Thus, every restaurant that chooses to be part of this initiative, will receive its payment within 7 days after the sale in the months of April and May. The expectation is to speed up the flow of up to BRL 600 million in the Brazilian market.
Customers can now choose a “Contactless Delivery”. The option is also communicated to restaurants.
The company says it still finds it premature to measure the impact of Covid-19 on the Brazilian food delivery market. According to the statement, “iFood has the flexibility to quickly adjust its operations to market needs, and is in constant contact with the authorities on this issue.”
U.S.-based UberEats is offering users free deliveries for orders placed to small and medium restaurants in Latin America. In some markets, UberEats allows restaurant owners to receive daily payments, to ensure constant revenue especially for micro and small businesses. Uber expects the measures to benefit more than 30,000 restaurants across Latin America.
The company also announced that it will provide medical and financial assistance, in addition to discounts on consultations and exams for couriers in Brazil.
“We want to support the thousands of partner restaurants, particularly small and medium-sized independent companies, users who trust our platform to receive food safely, and delivery partners who rely on the UberEats app to generate income”, said Eduardo Donnelly, regional general director of Uber Eats in Latin America.
Uber Eats also launched a campaign to make users aware of its “contactless” delivery, offering this option directly in the app.
Uber does not provide figures on increased demand for its Latin America delivery app, but the company’s CEO, Dara Khosrowshahi, said in a recent conference call with investors that the platform is experiencing significant growth in the region, a move that is important for offsetting the “moderate impact” in the ride-hailing division, the company’s main business.
Since conversations about the coronavirus began, Colombian Rappi has noticed “a significant increase in the number of orders”. According to market sources, the delivery application that operates in eight countries in Latin America, saw its sales rise 40% in the first two weeks of March. January and February had already seen growth of 30% over last year, according to information that the company passed to Reuters.
The categories that registered the greatest increase were pharmacies, restaurants and supermarkets, according to the company. “We believe it is a consequence of users concerned with the issue and quarantine measures being taken in different cities,” the firm said in a statement sent to LABS.
As with competitors, Rappi also adopted deliveries without physical contact – an option in the user app.
The platform also announced that it will deliver free food to 500,000 health professionals in Colombia. The objective is to recognize and support the efforts of these professionals who are at the forefront of the fight against coronavirus. The only condition for receiving these deliveries is to be in the area covered by Rappi, according to the company’s CEO, Simon Borrero.
The Brazilian delivery app James, from Grupo Pão de Açúcar, started making free deliveries to those who are part of the risk group, such as the elderly, health professionals and others.
The Prime subscription program will not charge fees from these customers. The benefit is valid for purchases above BRL 50 in Extra and Pão de Açúcar grocery chains and from BRL 25 in selected partner restaurants. There is no limit on the number of purchases per month.