Final Project

UBEREATS

Week 1 – Requirements

Using your selected company, complete and submit the following components of the project

 Introduction

 History & Overview of the Company

 Section 1: Internal Situation Analysis

 Internal Assessment & Analysis

 Capabilities & Resources Analysis (organizational structure, management, culture, financial condition - with ratio analysis if possible, an overview of resource capabilities, etc.)

 Description of products/service offerings

 Value Chain Analysis of one key product

 Overview of competitive strategy for one key product

Introduction

Uber Eats is an online food delivery platform from Uber which lets customers order food straight away, schedule meal orders, or place group orders from local restaurants and chains nearby. Customers can place orders with local restaurants from the Uber Eats website or through mobile application services. Food is delivered directly to your door, office, or whichever location the customer indicates within a short period. Usually, a delivery fee will be included. Uber Eats enables customers to set up group orders or meal schedule orders for a later time as well. To place orders, customers can use the Uber eats website, Uber Eats Applications designed for iOS and Android phones. Regardless of the method used, the ordering process is the same. Uber Eats acts as a middleman between restaurants and customers. Uber Eats provides full menus from a wide range of local restaurants offering a variety of cuisines and allows customers to place an order and track the delivery. Meals are delivered by couriers using cars, scooters, bikes, or on foot.

History & Overview of the Company

Uber Eats is an American online food ordering and delivery platform introduced by Uber in 2014 and found in San Francisco, California. Uber Eats' parent company Uber was founded in 2009 by Garrett Camp and Travis Kalanick. The company began food delivery in August 2014 by introducing the Uber FRESH service in Santa Monica, California. In 2015, the platform was renamed Uber EATS, and the ordering software became independent from the parent application Uber rides. Uber eats serves 45 countries with over 6000 cities worldwide.

Internal Situation Analysis

An internal analysis is a survey of an organization's capability, value, and competitive viability in the market. Uber Eats is a well-recognized brand offering a high standard of service. It has created an enormous brand name. Uber Eats is operating with the current and ever-changing technology. In 2019, Uber Eats said it would deliver food to customers by drones from the Northern Hemisphere summer of 2019. In July, Uber Eats began offering a dine-in option in certain cities that allowed customers to order food ahead of time and then eat in the restaurant. In 2020, during the COVID-19 pandemic, UberEats had a 30% increase in new customers as hospitality venues were closed and only opened for takeout options due to government restrictions to contain the pandemic. Most people decided to take away and consider using Uber Eats due to its good reputation. However, during the same period, Uber Eats has been criticized for charging fast-food restaurants 30% to 35% commission, which is slightly higher than other competitors. Considering most parts have been significantly impacted by the Covid-19 pandemic.

External Analysis

Despite the rapid growth in most regions worldwide, Uber Eats faces stiff competition in many areas, and several restaurants and household names have withdrawn their partnerships with Uber eats. Many companies offering the same product and services are coming up day by day and even charging fewer commissions and delivery fees suitable for the business owners and clients but significantly impacting Uber as a company. Competitors are coming up with significant discounts to entice new clients and get clients used to the Uber Eats services. Most restaurants have also developed their own online food delivery services; therefore, they do not require Uber to eat delivery services. This has led to Uber eats withdrawing its services from several regions in the world. With the increasing technology, it is challenging to keep with the ever-changing trends. Scientific advances are emerging now and then, for instance, the use of drones and robots. Uber eats must keep up with those emerging technologies, which not an easy task.

Capability and Resource Analysis

A Resources and Capabilities analysis is a research about the prospect of a company. Instead of focusing on its results, it highlights the mechanisms and opportunities a company could use to increase its output. Uber's Uber organizational structure has been very hierarchical, with co-founder and former CEO Travis Kalanick yielding a lot of power and micromanaging the company. Uber Eats has a culture of its own like any other company. When new employees join the organization, they are asked to enroll in 14 core company values. Those values have helped uplift Uber to one of the most important success stories. Any form of harassment or abuse is not entertained. Uber Eats financial position has grown tremendously over the years. Gross booking rose by 52%, with Gross revenue rising by an estimate of 53% in 2020 due to the Covid-19 uncertainty.

Description of products/service offerings

Uber Eats is a food delivery service offering online food ordering, group orders, and meal schedules to clients. The product provided by Uber eats is generally a wide variety of restaurants with different menus ranging from local to international cuisines. According to the order description, the services offered by Uber Eats are online delivery to doorstep, offices, or any location. Uber Eats offers a tracking service for any placed order. Once the food is prepared, the client can track the delivery person's movement; this can be by use of cars, bikes, scooters, or in-person. Uber Eats offers different payment services for food orders and any surcharges involved, like delivery fee. Clients can pay for any placed orders directly at the comfort of their homes or offices.

Value Chain Analysis of one essential product

A value chain was used to examine all the activities a business undertakes to create a product from start to finish. Once the activities are analyzed, a company can use the findings to assess its competitive advantage. Uber Eats essential product is online food delivery. Although it faces a lot of competition from other companies providing similar services, Uber Eats has become a household name with a considerable client base and edges its competitors due to its popularity.

Overview of competitive strategy for one essential product

Competitive strategy is the aspect that allows an organization to outmatch its competitors.

Even though Uber EATS is a separate application from Uber, it has made it easier for clients with uber accounts to access Uber without creating new accounts. It has been by linking all the client's personal information and payment details from Uber. The only thing required once you open the Uber Eats website or Applications is to log in and not sign up. Uber Eats has created a great customer feedback platform to post their reviews about products and services received. It has ensured the management captures all relevant information needed to improve on products and service. Uber Eats has been facilitating conversations with recommendations. Once you log in to the web, they usually have recommended meal options and pairings for the day. At times, the even go further ahead and provide discount coupons for next time orders. 

Week 2 – Requirements

Section II: External Situation Analysis

External Assessment & Analysis relating to the one industry in which the company competes.

1. Assessment of remote environment (STEEP) (Social/Cultural, Technological, Environmental, Economic, & Political/Legal/Regulatory opportunities and threats)

2. Assessment of competitive environment (5 Forces)

External Analysis

Uber's existing Australian demand mostly comprises of customers between the ages of 18 and 34 (73.3% of Uber users) (Roy Morgan, 2016b). For that cause, the target market for UberEATS would be the Brisbane City residents 18 to 34 years of age as they are more likely to consider and support the UberEATS software (Roy Morgan, 2016b). They are geographically segmented and contain suburbs 10 minutes’ drive from Brisbane CBD.

These customers experience a more active life, which decreases free time and drives customer comfort (IBISWorld, 2016c; MarketLine, 2016). This implies that customers do not choose to cook their own food on this target market anymore; that stems also from other factors such as room limitations and cooking facilities in smaller homes (Euromonitor International, 2016e; MarketLine, 2016). In comparison, customers in town have seen a change from ownership to personal automobiles (Euromonitor International, 2016c; Euromonitor International, 2016e). Therefore, by offering customers versatility, variety, and maximum leisure time, UberEATS will effectively satisfy the convenience demands of this sector Consumers in this target group are technological adopters and eager to incorporate modern mobile apps (Euromonitor International, 2016d). The UberEATS application is therefore able to tap into this knowledgeable technology segment and fulfill customers' needs further by providing a quick and efficient way to buy (Euromonitor International, 2016d; Wirtz et al., 2012). Consumers wish to build an emerging market for on-demand premium food delivery services without leaving the house (Euromonitor International, 2016a; Euromonitor International, 2016e). With a turn towards appreciation of produce, plus safe food and food patterns, luxury commodities are now viewed as an excusable indulgence; (Aaker, 2014; Euromonitor International, 2016e; Euromonitor International, 2011). With its premium 'restaurant-quality' food with enhanced comfort factor, Uber EATS will effectively support this segment and give customers its perfect food experience.

Competitor Analysis

Because of their strategic similarity, Foodora and Deliveroo are called UberEATS major first stage rivalry (Aaker, 2014). Both Foodora and Deliveroo provide a service like UberEATS with own drivers; they work with restaurants that were previously unable to deliver home (Euromonitor International, 2016a). The requirement for good quality foods has offered the first stage competitors comparable value proposals and has rendered this a highly competitive space (see Figure 1). (Euromonitor International, 2016a; Kohler, 2016). However, the gap between UberEATS’s and business properties is large (see Table 1) (Aaker, 2014). These first stage players have higher cost structures than UberEATS because they provide their vendors with uniforms and biking (Euromonitor International, 2016a). The lower cost structure and the broad, ready-to-use drivers' network allows them the ability to succeed in this market. Delivery Hero and Menulog are second stage rivals of UberEATS (McDuling, 2016). Similarly, to UberEATS, these businesses sell customers a restaurant where food is ready for delivery at home (Lieu, 2016). However, the delivery methods vary based on the drivers of the restaurant alone (Aaker, 2014; Lieu, 2016).

Third-tier participants are Dominos, Pizza Hut, MacDonald's, the KFC, and Starving Jack The fast-food business (IBISWorld, 2016b). These firms are deemed indirect rivals of UberEATS because of the disparity in policy and positioning (Aaker, 2014).

UberEATS Market Positioning

Market Analysis

UberEATS would be business-to-business in the developing sector for food procurement services. In the last 5 years, evolving market trend, with an average growth rate of 6.2 per cent, has brought the restaurant industry solid growth totaling $13.1 billion in revenues (IBISWorld, 2016c). High-end restaurants currently have the largest demand and market share in the industry at 39%; these restaurants aim to extend their takeovers to reach the rising convenience market (IBISWorld, 2016c). Performance in market revenues is expected to be 2.3% in the remaining 5 years and 1.4% in the coming 5 years (IBISWorld, 2016c). Discretionary wages and existing comfort and food patterns are also expected to rise in 2016, which gives UberEATS a chance on the demand for profitability (IBISWorld, 2016c).

Submarket UberEATS consists of courier and delivery services, particularly delivery services at home. The door-to-door delivery systems comprise 25.4% of the market shares of the courier and delivery sector and witnessed a strong rise in 2016 as a consequence of the online shopping boom (IBISWorld, 2016a). There are very limited barriers to entry, but as Section 3.0 suggests, with large international brands already developed, the market has a great competition which poses potential entry threats (Aaker, 2014; IBISWorld, 2016a). Keeping high-end specialty food markets open, delivering high food quality and exceptional customer support, the introduction of emerging innovations such as the UberEATS framework, and keeping cost structures at low levels are main drivers of success for UberEATS (IBISWorld, 2016a; IBISWorld, 2016c). The strategic needs of UberEATS involve a top-quality restaurant that totally eliminates low-end quick food choices (Aaker, 2014). UberEATS Strategic assets will have competitive benefits by providing customers a broader variety of choices for personalized meals, the capable delivery times for short and vast service areas (Aaker, 2014).

Environmental Analysis

1. Consumer Trends

The growing food culture is projected to raise sales in the restaurant and, afterwards, sector, according to IBISWorld (2016c). Health literacy and an emphasis on food safety are also a continuing theme (IBISWorld, 2016c). Consumers often tend to create a healthy choice between healthy choices and better food, in particular while deciding to take away comfort (IBISWorld, 2016c). These developments could grow from 17 in 2016. (IBISWorld, 2016c). Consumers are having increasingly active lives and are also pushing the pattern of convenience (IBISWorld, 2016c). The purchasing of restaurants and the usage of mobile/online ordering platforms improved. This development (IBISWorld, 2016b). IBISWorld (2016c) explains that these developments would raise demand for luxury goods and provide UberEATS with an essential growth opportunity.

1. Strategic Uncertainty

Consumers appear to express anxiety for the economic future and are thus currently concentrating on growing spending and debt reduction; (IBISWorld, 2016c). The lower customer trust could pose a potential challenge to UberEATS. After 2016, however, customer trust has continuously improved (Roy Morgan, 2016a). Nevertheless, UberEATS can continue to track and evaluate the economic environment and the market trust concerned (Aaker, 2014). UberEATS would still be affected by the laws of industry (IBISWorld, 2016b). Drivers must comply with stringent food safety requirements, which include sanitation, food handling and transport (Lieu, 2016).

Preliminary Strategic Recommendations

UberEATS policies can rely on premium service from famous specialty restaurants and restaurants to high-quality food choices. This would follow the food pattern that fuels the consumer's demand for super-indulgent food and exclusive food experiences (Euromonitor International, 2016b; IBISWorld, 2016c; McCauley, 2016). The collaboration with the well-known Brisbane food haven Eat Street Markets is another strategic suggestion of UberEATS. UberEATS can give the customer, from the comfort of their residences, exclusive (in predetermined days) entry to the Eat Street Market. This offers a special culinary experience for customers and provides UberEATS with a clear and creative competitive edge.

Week 3 _Requirements

Section III: Situational Diagnostics & Recommended Strategic Action(s)

In this section, you present the analysis that integrates the internal and external factors that demonstrate the current condition of the organization. What type of competitive strategy do you determine to be appropriate based on their resource capabilities, environmental conditions, and competitive position? Use some of the diagnostic tools for analysis and evaluation to support your premise, and then conclude this section with one major strategic action item that you deem to be appropriate for the company to undertake.

1. Diagnostic analysis of current condition using strategic tools: 

· Industry Growth rate & Market Share position in BCG Matrix

· SWOT Analysis

· Ratio Analysis of financial condition

1. Recommended Strategic Action

Industry Growth rate & Market Share position in BCG Matrix

BCG growth share matrix is the planning tool which will use the graphical representation of the company services and products in effort in helping company deciding what it must keep, invest or sell. Matrix plots the company related offering in four of the square matrices with Y-axis represent rate of the market growth and X-axis represent market share. In industry where the price cut and the discount promotions are major tactic in grabbing the market share, Uber have looked beyond the present products and the market and have developed UberEats. This products development and the diversification strategy that align with the product market, growth matrix the position Uber well for the further growth and will strengthen the ability of Uber in turning the profit for the investor

SWOT Analysis

SWOT analysis of UberEats is being performed to be relative to the competitor in gaining to understand the way other food delivery service in areas to do better, learning from the shortcoming turn the weakness to strengths and disrupts food delivery business as that it has with the taxis. We could approach the SWOT analysis in couple of ways, get the people together in kick off strategy formulations informally or formal and sophisticated.

Strengths

Flexibility in the Food delivery service from an instant lunch or the dinner deliveries for the select dish Uber instantly deliver the lunch in less than 10 minutes. Separate drivers base handling UberEats delivery in order to avoid the overlap with the regular Uber drivers when in providing them flexibility in switching between two. Flat deliveries fee $4.99 and of no hidden service charges ensure transparency and constituency in the pricing. Strengths will be the things that organization will do well particularly on in the way that will distinguish from competitor. Think in regard to benefits an organization will have over the other. This might be motivation of employees, strong set of the manufacturing process. Any aspect of organization is only strength if that bring us the clear benefit. For instance, if all the competitors will provide the higher quality production process is not strength in market it is the necessity.

Weakness

Only ways to order through APP research have shown older demographic will not be as the technology savvy as younger generation. SWOT analysis would only be important if we gather all information, we will need so it is best in being realistic and faces any of the unpleasant truth soon. Weakness like as strengths will be inherent feature of an organization so focusing on the UberEats people, procedures, systems, resource and consumers, think in regards to the way could improve and sot of the practices that will need to be avoided by company. Opportunities will be chance or opening to something positive will happen, but we will need in claiming them to ourselves. They will usually arise from the situation external to organization and will need eye what may happen in future. They may arise as the development in market we serve or in technology we use. In being able in spotting and exploits the opportunity could make big difference to organization ability when is compared and takes lead in market. Think in regard to opportunities we could sport soon this will not need in being game changer even smaller benefits could increase organization competitiveness.

Opportunities

Target higher end consumer who will want in delivery from finest restaurant utilizes the availability of the Uber drivers for the delivery

Threats

Price sensitive market, higher end restaurant might want in staying the exclusive in giving the consumer the unique brands experiences. This will include anything that could affect negatively the business from external side like as shift in the market requirement, shortage of food supplies, raw materials and supply chain issues. It is important in anticipating threats and takes the actions against them before we become victim of them and our growth stall. We might notice that the quality specifications or standards for our product will be changing and that we will need in changing the product if we are staying in lead (Beth.K, 2019). Before leap into action look for the possible connection between quadrant of matrix, it is time in ruthlessly prioritize and prune our ideas so that we could focus money and time on more significant or important one. Refine every point in making the comparison clear

Ratio Analysis of financial condition

Current ration could give the sense of efficiency of the Company operating cycle or the ability in turning the product to cash. Companies that have the trouble to get paid in the receivable or have the long inventories turnovers to liquidity issue as they will not be alleviate the obligation. As business operation will differ in every industry, it will always be useful in companies within same industries. High current ratio will be capable a company is paying the obligation. Ratio suggests that a company will be unable in paying off obligation if they will come due at a point (Amanda.S, 2016).

Recommended Strategic Action

Increase the competition present the strategically uncertainty as food couriers pick up and will deliver services industry will face the higher levels of the market competition. UberEats competitive benefits are the larger or huge network of an available driver that would buffer new markets entrant. Driving factor for the competition will includes delivery time, reputation, and price. Fluctuation in the disposable income will have possible in impacting the consumer’s demand and the revenue in the sector. In counteract change in the disposable income, UberEats would need’s in reassess continually the market position and will employ the responsive marketing strategy that will adapt in chaining the market climate. UberEATS face risks that the high-end restaurant might want in staying exclusive in giving the consumer physical restaurant experiences and the service quality. Working with the restaurants UberEATS could propose the ways to ensure unique brand experiences and the quality service in ensuring the customers will be satisfied with the meal.

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