Amazon Food will be launched on Amazon’s shopping app itself, and in select locations as a pilot project.

Amazon delivery executive holding an Amazon parcelPicxy/Representative
Atom Foodtech Thursday, May 21, 2020 - 16:12

Amazon India on Thursday officially forayed into food delivery, taking on Swiggy and Zomato, which recently saw layoffs amid the lockdown and COVID19 pandemic. The company is launching Amazon Food, which will be launched within Amazon’s shopping app itself, in select locations as a pilot project.

As of now, Amazon Food has been launched in Bengaluru and those living in select pin codes can access it from the main app. 

Amazon India has partnered with a host of restaurants and cloud kitchens including Adigas, Freshmenu, Box8, Namaste, Khichdi Experiment, Chai Point, Chaayos and Behrouz Biryani. Amazon Food has also partnered with restaurant chains such as California Burrito, Mojo Pizza, Faasos, Paradise Biryani, Keventers, and Mad Over Donuts. Amazon has also partnered with 5-star hotel chains like Radisson and Marriott to bring food from their gourmet restaurants like Shao, Melange, Saffron, WBC and M café to customers.

“Customers have been telling us for some time that they would like to order prepared meals on Amazon in addition to shopping for all other essentials. This is particularly relevant in present times as they stay home safe,” an Amazon spokesperson told TNM. 

During the lockdown, Amazon had been delivering essential items and groceries via its Prime Now, on-demand grocery delivery app, and Amazon Fresh app. It recently began delivering all products to all locations except containment zones after restrictions on e-commerce deliveries were lifted.  

“We also recognize that local businesses need all the help they can get. We are launching Amazon Food in select Bengaluru pin codes allowing customers to order from handpicked local restaurants and cloud kitchens that pass our high hygiene certification bar. We are adhering to the highest standards of safety to ensure our customers remain safe while having a delightful experience,” the spokesperson added.

Amazon Food’s launch comes at a time when Swiggy and Zomato have had to lay off employees and introduce cost-cutting measures amid the COVID-19 pandemic. Swiggy recently laid off 1,100 employees and announced a scaling down of adjacent businesses. Zomato, which is currently Swiggy’s biggest rival and acquired Uber’s India food delivery business, UberEats India, last year, had to lay off about 13% of its workforce, apart from instituting pay cuts for the entire organisation.

Amazon has already pumped in more than $6.5 billion in India and the vast online food landscape is a lucrative opportunity once the lockdown opens and people get to order food more. Reports surfaced last year amid Zomato-Swiggy merger talks that Amazon was gearing up to launch its own online food delivery division to compete with food delivery apps in the Indian market.

The retail behemoth already has a robust existing workforce in the country that can be utilized along with hiring more delivery partners to beat the competition.

According to Prabhu Ram, Head-Industry Intelligence Group (IIG), CMR, the food delivery business is no longer a two-horse race and is increasingly witnessing cut-throat competition.

"With the entry of new players, including the likes of Amazon and Uber Eats, a potential merger of Zomato and Swiggy would make sense," Ram told IANS.

In the next three years, the food tech industry in India is going to grow from $4 billion to $15 billion.

Zomato in January acquired Uber's Food Delivery Business in India in an all-stock deal of nearly Rs 2,500 crore, with Uber having 9.99 per cent stake in the Deepinder Goyal-led food delivery platform.

Uber started its food delivery service in India around mid-2017, but was not able to scale up in the face of big players like Zomato and Swiggy.

With IANS inputs