The lion’s share of Amazon’s growth can be explained by its well-established delivery business. Their web and app courier services added to this expansion.
A relatively small investment in a delivery app can have a tremendous pay-off: improved services, streamlined procedures, and a boost in income.
If you are one of these smaller companies, with this article, you can get the essential tips and tricks to build a delivery app.
How do Delivery Apps like DoorDash & goPuff Work?
When speaking about on-demand delivery apps, like DoorDash, goPuff, UberEats, or Amazon Flex, the first thing to come to mind is “how do they work, and what makes them so successful?”
By the way, most people think of on-demand apps only in terms of food delivery.
The range of on-demand delivery services can be broad and include services like clothing, shopping, drugs, etc.
On-demand delivery apps can be divided into several groups:
Business-to-Consumer (B2C, also called Enterprise-to-Person, or E2P)
Examples include companies like McDelivery and Starbucks.
Business-to-Business (B2B, also Enterprise-to-Enterprise, or E2E)
An example is the shipment app Cargomatic, also called “Uber for truckers,” that allows enterprises to find reliable carriers.
Consumer-to-Consumer (C2C, also Person-to-Person, or P2P)
C2C apps like Etsy and eBay allow users to buy products and services from each other.
As well, keep in mind the variety of business domains to which the app could be applied:
- On-demand car rental apps like Turo and easyCar.
- Home services like Handy and Task Rabbit.
- Transportation and logistics apps like Uber Freight and UberDeliver.
Unique Selling Points of Well-Known On-Demand Delivery Services
Next, we’ll brief you on how we managed to succeed with delivery app development with a real-life example. goPuff is a project that has grown into a complex consumer technology platform.
In 2014, we started an on-demand courier delivery app development project for a local hookah delivery start-up, goPuff. As of 2020, it delivers everyday essentials like home cleaning products, personal care items, baby and pet products, OTC medications, food, drinks & more. The platform has over 200 facilities and operates in 500+ cities in the USA.
These days, goPuff app has over 2M downloads from app stores. We continue to provide ongoing development and support services for the project.
How to Start with App Development Wisely
Here we explain all the aspects of on-demand courier delivery app development in greater detail.
Step 1- Start with market analysis
A proper market analysis is half the job done for successful app development.
- Market size
Market size depends on the type of on-demand business. In general, as of June 2020, on-demand delivery services are growing worldwide.
2. Target audience
Focus on the type of customer you want to attract.
3. Market demand
Why do customers order deliveries?
The factors driving this demand may be cost, speed, size, time-savings, group orders, etc. Learn if your customers prefer costlier 1-day shipments or cheaper options that take longer.
It is recommended that you benchmark your competitors against each of the market demands to have a comprehensive and clear view of their strengths and weaknesses.
5. Blockers and risks
Some of the most common blockers include investment, access to resources (e.g. partnership with grocery stores, the pool of drivers), distribution channels, and location (delivery to distant spots will take more risks).
As you complete your market research, use the findings to build a SWOT analysis.
Step 2- Choose a business model and monetization strategy
How to make money with your delivery app. Here’s how the on-demand economy leaders do it.
As you see, there are different ways to monetize in the on-demand industry, namely:
- subscription plans
- service fees (% from the order cost covers the delivery expenses)
- advertisement (via banner, video, native ad, interstitial ad, incentivized ad)
- eCommerce and merchandising
Step 3- Find a reliable software development company
For a successful project, we recommend centering attention on IT vendors from Eastern Europe.
Here you have the best of two worlds: low risk of failure and low cost.
Quality: Eastern Europe combines the unique conditions of well-established technical universities and a quickly growing online sector.
Price: Due to certain economic policies, rates are lower compared to other regions. This is due in part to a taxation subvention that is directed to boost IT growth.
Your collaboration with a software development team will run through several stages. For instance, at MLSDev the app development process is split into two core stages — Discovery and Development.
Step 4- Plan and prioritize the on-delivery app functionality
You have to think through the most important functionality and predict how it will be perceived by customers. On the one hand, the service should cover all user demands; on the other, it should not be cluttered with excessive functionality.
Step 5- Test and launch the product
Successful on-demand courier delivery app development is hard to imagine without multiple sessions of testing different stages of the project: UX/UI design, app code, synchronization of front-end and back-end of the system, etc.
Step 6- Plan the ongoing app support and development
Once you finish the courier service app development for the first version, you should think about how to scale the system further and include the necessary updates based on market changes and real user feedback.
Step 7- Work on the offline side of the project
You also have to consider how to arrange the real-life side of your business. This is about setting partnerships with suppliers and couriers, coverage of legal aspects, as well as the involvement of early marketing efforts.
Functionality of On-Demand Courier Delivery App Development
Delivery App: Features for Client App
We recommend starting on-demand courier delivery app development with basic features, namely:
With the consequent project versions, you may consider including more advanced ones:
Functionality for a Courier App
Some basic features for an app are as follows:
An advanced courier app could include the following functionality:
Admin Features for App Development
An admin is a person that cares about proper order execution and delivery.
Tech Stack for On-Demand Delivery Apps
The on-demand app development process consists of a few tech parts.
1. Client-side (or, front-end of a service) — composed of the elements with which the end-user interacts.
2. Server-side (or back-end of a service) — corresponds to the place where all the app functions are performed. The common technologies applied in back-end development include:
- programming languages: Ruby (recommended), Elixir, Python, PHP, Java, etc.
- web frameworks: Ruby On Rails (recommended), Phoenix
- database servers: PostgreSQL (preferred), MySQL
- web servers: nginx (preferred), Apache
- cloud server platforms: Amazon Web Services (AWS, EC2, S3, etc.)
3. API (Application Programming Interface) — protocol description of how system back-end and front-end interact. API also relates to the integration of third-party services used in the service.
Here is a high-level overview of the on-demand delivery project architecture.
KPIs in Building an On-Demand Delivery Apps
Here is the list of actions and metrics you should follow to turn a delivery project into a successful business.
1. Grow the user base
A wise strategy is to start small:
- Start with the local market
- Pre-launch advertising
- Involve local retailers
2. Increase user retention
Pay special attention to the following points:
- Customer support
- Rating and reviews
- Loyalty programs
- Partner screening
3. Keep contractors, drivers satisfied
4. Track digital service metrics
You can check out and calculate the most common metrics to track the on-demand development app KPIs.
How Much Does it Cost to Start a Delivery Business?
The price to build a MDP (minimum delight product) for an on-demand delivery app starts from $60,000 per platform (iOS or Android or Web) for one user app (a courier or client app). Thus, the first working version of an on-demand service may cost you a minimum of $230,000.
Please note that these costs are based on an average hourly rate of $40 for software development services in Ukraine.
All in all, the on-demand economy industry has a lot of potential for investment.
As of 2020, the influence of COVID-19, as well as insight from statistics supports the fact that users demand the quick provision of services and delivery of goods.
Note: This is a summary of a guide.
Check out more details and recommendations to build an eCommerce website inside the complete article on the MLSDev blog