Talabat Business Model: What Makes it the Biggest Food Ordering Service in the Middle East?

Talabat Stats and Facts: Funding and Major Milestones

• Founders: Abdulaziz Al Loughani
• Founded in: 2004
• Headquarter: Kuwait
• Acquired By: Rocket Internet for $170 Million
• Total Funding raised ($): $1.57 Billion

Talabat Success Story: A Willingness to Go Against the Grain

A subsidiary of Delivery Hero, Talabat is today the biggest online food ordering service in the Middle East. But, it had its own share of challenges and obstacles in the journey to become the giant in the food-delivery industry.

When a 33-year old entrepreneur figured out the ample opportunities available in the local food delivery market of Kuwait in 2005, nobody believed him. But, he did not lose hope. And that's how innovations are made.

At that time, just 23% of the country's population was using the internet, and thinking of a digital startup-like Talabat was considered something rubbish or a waste of time. Also, they had to go through the pain of finding delivery locations without Google Maps and the internet was as slow as a turtle back then.

But, disruptions are caused by those who don’t lose hope.

Entrepreneurs in the MENA region thank the founder of Talabat today for his stubborn nature, as he worked hard to scale the company and successfully set an example of how an industry can be transformed. Its acquisition for a whopping $170 Million, the biggest purchase of an internet company in its time, has encouraged many budding entrepreneurs and helped them realize the potential of the regional tech startup sector.

Here's what Talabat's CEO said about UAE in an interview with the local press:

Talabat has evolved from a small Kuwaiti-based startup to a leader in tech and the UAE was the top priority for us. The market in the UAE has grown incredibly fast in the last few years - from being a $10 Billion market in 2011 to a $14 Billion market in 2016. So there are ample opportunities for newcomers in the field
- Abdulhamid Al Omar, CEO, Talabat.

Presently, Talabat is known as one of the most technologically sound food delivery companies in the MENA region. The app operates in seven countries, namely, the UAE, Kuwait, Egypt, Qatar, Bahrain, Oman, and Jordan. Thus, we can say that "from a foolish-looking idea" to "a startup worth millions", Talabat has come a long way.

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How Does Talabat Work: Talabat Business Model Canvas

If Talabat would have stuck to an ordinary business model, it would have died long ago. Every year, millions of food delivery startups are launched but only a few are able to survive profitably.

For example, Uber Eats had to shut down its services in the UAE and Egypt because of its inefficiency to withstand the competition. But, Talabat is still the leader. The app won the hearts of the people in the Middle East by providing convenient and unmatchable services. Along with restaurants, it now lets users purchase items from gift shops, grocery stores, and flower shops.

Let's have a look at how Talabat worked to win the market:

1) Talabat follows an on-demand hyperlocal delivery model and its main focus is on the food delivery market. The app leverages robust technology to eliminate the gap between food lovers and restaurants.

2) It works on a dual partnership basis. Thus, along with customers, it is also responsible for providing benefits to the restaurants. The value proposition it provides to all its stakeholders is the key to the platform's massive success.

3) Another factor behind Talabat's popularity is its exclusivity. The company provides a discount to restaurants that cancel their partnerships with other delivery services. It saves businesses the hassle of maintaining a presence on multiple platforms. So, they like to move to exclusive partnerships.

4) They operate using a website and a mobile app. The users can order food or groceries either via the website or mobile app. Along with ordering, customers can explore nearby restaurants and their menus on the app.

5) Rest of its work is the same as any on-demand hyperlocal service. A restaurant partners with Talabat and gets listed. Customers can register and start ordering food or other items. Once the restaurant gets an order, it starts preparing the food and notifies a delivery agent to deliver the order to the location.

6) During this entire cycle, the customer keeps getting notifications about the order status and can also track the order in-app.

7) Some of the features using which Talabat provides an amazing CX are easy app onboarding, a simple check-out process, multiple payment options, GPS tracking, order history, in-app chat, robust search, and many more.

Also Read: 10 Outstanding Features to Make Online Food Delivery Apps Standout

Talabat Revenue Model: How Does Talabat Make Money?

Using Talabat, customers can order everything from food, groceries to flowers, and medicines online from hundreds of shops and restaurants nearby. Just like its business model, Talabat's revenue model is also unique and it makes money using various revenue streams.

1. Commissions

Like other food delivery apps, Talabat doesn't have a flat commission model. It charges 15-25% of the total bill from the businesses. But, as it focuses on being exclusive, it offers a 5-10% reduction in commission rates for exclusive partners.

This exact commission amount depends on various factors like the location of the restaurant, order frequency, etc.

2. Delivery Charges

A customer has to pay delivery charges on every order. Just like commissions, the delivery rate is not fixed and it again depends on various factors like location, environmental conditions, and more. For example, rates will be higher on a rainy day or during festivals.

It also eliminates the delivery charges on orders above the threshold limit. This is a common tactic in the eCommerce industry for increasing the average order value.

3. Advertising

In order to get more exposure to the app, Talabat provides advertising opportunities to businesses. For example, it has priority listings and banner ads.

When opting for priority listing, the businesses get a top spot in the rankings. On the other hand, banner advertising means you are showing banner ads inside the app. Talabat uses these two strategies to generate advertising revenue.

What Are The Features Of A Food Delivery App Like Talabat?

Let's get down to the detailed features of a food delivery app like Talabat, with special emphasis on the three main panels: User Panel, Restaurant Panel, and Delivery Agent Panel.

The User Panel

The User Panel is the core of the food delivery app, providing an intuitive and smooth user experience for customers. Here's a list of its key features:

1. User Registration and Login:

Various sign-up modes, such as email, phone number, and social media handles, make onboarding simple and effortless.

2. Location Detection and Selection:

Automatic location detection or manual entry allows users to find restaurants delivering to their area.​

3. Restaurant Browsing and Search:

Users can browse a pre-curated list of restaurants or apply deep search filters to discover a particular cuisine, dish, or dietary requirement.

4. Menu Exploration:

Detailed menus with item descriptions, images, and prices enable users to make informed decisions.​

5. Cart Management:

It should be simple to add or remove items from the cart without having to jump through hoops for checkout.

6. Secure Payment Options:

There are varied payment options in the form of credit/debit cards, digital wallets, or cash on delivery to accommodate a range of customer preferences.

7. Order Tracking:

Real-time tracking of orders, from preparation to delivery, keeps users informed every step of the way.​

8. Order History and Reordering:

Easy reordering of favorite foods is made possible through access to previous orders.

9. Ratings and Reviews:

Ratings and reviews by users help them share their dining experience and leave feedback, enabling others to make a well-informed choice.

10. Promotions and Discounts:

Customized offers and discount codes enhance user engagement and loyalty.​

11. Customer Support:

In-app chat or call support ensures prompt assistance for any queries or issues.​

The Restaurant Panel

Through the Restaurant Panel, customers can handle their business activities with enhanced efficiency. Key features include:

1. Restaurant Registration and Profile Management

The system allows restaurants to establish profiles that display branding information as well as product menus while managing open and closed business hours.​

2. Menu Management

Easy addition, modification, or removal of menu items, including setting prices and availability.​

3. Order Management

Real-time notifications of incoming orders with options to accept or decline based on capacity.​

4. Order Tracking

Order Tracking functionality allows clients to monitor order statuses between preparation and delivery times to maintain service speed.

5. Analytics and Reporting

The accessibility of sales statistics, together with customer opinions along performance indicators, allows managers to prepare strategic choices.

6. Promotions and Offers

Ability to create and manage special deals or discounts to attract and retain customers.​

7. Communication Tools

In-app messaging or calling features facilitate direct communication with customers and delivery agents.​

8. Payment and Commission Management

Transparent tracking of payments received and commissions deducted ensures financial clarity.​

The Delivery Agent Panel:

The Delivery Agent Panel is designed to streamline the delivery process for couriers. Its features include:

1. Agent Registration and Profile Setup

Delivery personnel can register, providing necessary identification and vehicle details.​

2. Order Notifications

Real-time alerts for new delivery assignments, with options to accept or decline based on availability.​

3. Route Optimization

Integrated GPS and mapping tools provide the most efficient routes to the restaurant and customer locations.​

4. Order Status Updates

Agents can update the status of deliveries, from pickup to successful drop-off, keeping all parties informed.​

5. Earnings and Incentives Tracking

Detailed records of completed deliveries, earnings, and any bonuses or tips received.​

6. In-App Communication

Direct messaging or calling options to coordinate with restaurants and customers as needed.​

7. Availability Management

Agents can set their working hours and mark themselves as available or unavailable for deliveries.​

8. Support and Assistance

Access to help resources or support teams for resolving any delivery-related issues.​

Additional Features for Enhanced Functionality

To further enrich the user experience and operational efficiency, consider integrating the following advanced features:

1. Loyalty Programs

Reward systems that offer points or discounts for frequent users encourage repeat business.​

2. Multi-Language and Currency Support

Catering to a diverse user base by offering multiple language options and accepting various currencies.​

3. Social Media Integration

Allowing users to share their experiences or favorite dishes on social platforms enhances brand visibility.​

4. Real-Time Analytics

Comprehensive dashboards for administrators to monitor app performance, user behavior, and other key metrics.​

5. Advanced Search Filters

Enabling users to search based on dietary restrictions, preparation time, or user ratings for a more personalized experience.

How Much Does It Cost to Develop a Food Delivery App Like Talabat?

Let's get real here, all businesses begin with one thing in mind: making money. And passion, purpose, and innovation are all necessary components of the equation, but no founder is interested in pouring their heart (and bank account) into a product that won't bring in a decent return. That's why it's important to know how much investment goes into creating a food delivery app like Talabat before taking the plunge.
Now, here's the thing, there ain't no universal price to create a food delivery app. The cost will change significantly depending on several decisions you make during the process. Just like building a house, the price relies on the size, shape, materials used, and who you get to build it.
Here's a breakdown in a way that makes sense.

What Affects the Cost of Building a Food Delivery App Like Talabat?

The price tag on your dream app depends on several factors. Let’s dive into the big ones:

1. Feature Set

The more features you add, the more time and resources go into building them. Real-time GPS tracking, multiple payment gateways, ratings & reviews, and advanced filters? All awesome, but they do raise the cost.

2. Platform (iOS, Android, or Both?)

Want to reach both Android and iPhone users? That means developing two separate apps (or choosing cross-platform development). While cross-platform tools like Flutter can cut down costs, native apps often deliver better performance.

3. UI/UX Design

A sleek, intuitive, and user-friendly interface can make or break your app. But designing that kind of experience takes skilled designers and more hours.

4. Backend Infrastructure

Food delivery apps run on complex backend systems that manage users, restaurants, delivery partners, and real-time order data. A strong backend provides smooth performance, but also higher cost.

5. Location-Based Services

Want your app to show restaurants nearby and track delivery in real time? You’ll need location-based APIs, which require integration efforts and testing.

6. Third-Party Integrations

No matter if it's payment gateways (Stripe, PayPal), maps (Google Maps), or analytics tools (Firebase, Mixpanel), integrating these services takes time and amplifies the development costs.

7. Development Partner

Who builds your app matters. Freelancers might be economical, but agencies or experienced development companies bring a complete team, better project management, and long-term support.

8. Maintenance & Updates

Your app needs periodic updates, server maintenance, and occasional bug fixes. Set aside a portion of your budget for post-launch support.

3 Lessons You Should Learn from Talabat’s Success

There is something to learn from every business model and success story and Talabat is no exception. Here is what you should learn from the success story of Talabat:

1. Think Big and Solve Problems

An app idea needs sheer dedication, effort, and focus to be successful. No matter what others say, if you believe in a concept, it is your time to put your blood and sweat into it to drive disruption.

Initially, people criticized the founder of Talabat for executing such an idea that relied heavily on the internet and technology. But, he saw the potential and scaled the startup to new heights. Hire mobile app developers to stay ahead of the competition.

2. Have an Eye on the Global Players

If a concept is new in your location or country, it doesn't mean it is not having any potential. If you see some of the global players validating the concept which is yet unknown in your nation, it is your opportunity to take action and introduce that innovation to your people. When Talabat was launched, even though it was a new concept for the Middle East, it was validated in the Western markets a long ago.

Later on, a German-based company acquired the startup and it transformed the way people shop in the entire region.

3. Always Strive to Scale

While building a tech startup, it is not a good idea to limit it to one region. Talabat was just a Kuwait-based startup but today it is the giant of online food delivery in the entire Middle East. It is crucial to not restrict yourself to boundaries if you want to scale and do something big in the modern digital world.

Why Apptunix Is Your Best Bet for Building a Food Delivery App Like Talabat

If you're serious about building the next big thing in food delivery, you need more than just developers. You need Apptunix.

We’re not just coders; we’re creators of success stories. At Apptunix, we transform your idea into a powerful, user-centric, and revenue-generating app that stands tall among giants like Talabat. With years of hands-on experience, a top-tier team, and deep industry know-how, we help startups and enterprises launch food delivery platforms that actually thrive in today’s competitive market.

Here’s Why So Many Brands Trust Apptunix:

• Custom Solutions: Whether you’re launching a local startup or a nationwide delivery platform, we build tailored apps that suit your unique needs.
• Faster Time to Market: Our ready-to-go food delivery solutions mean you can launch in as little as 3 days.
• Proven Track Record: From powering McDonald’s app in India to building successful platforms in the UAE and Bahrain, our work speaks for itself.

Wrapping Up

So, this was all about the Talabat Business Model. The company surely came a long way from being a tech startup in the early days of the internet to being the biggest food delivery business in the Middle East. Especially in the UAE, the on-demand food ordering industry is growing fast.

Thus, there is plenty of room for any new food delivery startup to flourish in the region and earn millions of dollars in sales. Get in touch with Apptunix, a mobile app development company to help you, we are just a call away!