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On demand delivery: All you need to know in 2023

By Riya Kanwar 17th August 2023

The world of business has witnessed a significant shift in recent years. On demand delivery services have transformed traditional business models. As consumers increasingly expect convenience, speed and efficiency, businesses have had to adapt and embrace the new trend.

In this comprehensive guide, we will explore the concept of on demand delivery, its benefits and challenges. We will talk how businesses can create their own delivery apps to cater to the modern consumer.

The Rise of On Demand Delivery: A Lucrative Market Opportunity

The on demand delivery market has experienced exponential growth in recent years. According to Statista, revenue is expected to show an annual growth rate (CAGR 2023-2027) of 12.78%, resulting in a projected market volume of US$1.65tn by 2027. This surge in demand can be attributed to changing consumer preferences, with 60% of customers willing to pay extra for doorstep deliveries.

Furthermore, the rise of the millennial generation, who make up 49% of customers, has contributed to the increasing popularity of on-demand delivery services. Additionally, the on-demand business model has gained favour among employees, with 63% stating their willingness to work in such an environment.

What is On Demand Delivery?

On-demand delivery refers to a service that allows customers to request and receive products or services instantly or within a short timeframe. It eliminates the need for customers to physically visit a store, restaurant, or service provider by bringing the desired items directly to their location. This convenience has made on-demand delivery a game-changer in various industries, including food delivery, package delivery, and transportation.

How On Demand Delivery Works

1. Placing an Order

The first step in the on-demand delivery process is placing an order. Customers can do this through a dedicated mobile app or website provided by the delivery service. They can browse through a wide range of products or services, select their desired items, and add them to their virtual cart. Once the order is complete, customers provide their delivery address and any additional instructions.

2. Driver Assignment

Once the order is placed, the delivery service’s system assigns a driver to fulfill the request. This is typically done based on factors such as the driver’s proximity to the pickup location and their availability. The driver receives a notification on their device, allowing them to accept or reject the delivery request.

3. Real-Time Tracking

One of the key benefits of on-demand delivery is the ability for customers to track their parcel’s path and location in real-time. This feature provides transparency and peace of mind, as customers can see exactly where their delivery is and its estimated arrival time. It also allows them to plan their day accordingly.

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Daily Challenges faced by On Demand Delivery Businesses

4. Scheduling Orders

In addition to immediate deliveries, some on-demand delivery services offer the option to schedule orders. This allows customers to plan ahead by booking orders and reserving a specific delivery time. Whether it’s for a future meal, a gift, or an important document, scheduling orders ensures that customers receive their items at their preferred time.

5. Automatic Dispatching

To streamline the delivery process, many on-demand delivery services utilize automatic dispatching. When a customer places an order, the system automatically assigns the closest available driver to fulfill the request. This optimization helps reduce delivery times and ensures efficient use of resources.

6. Order Management

For businesses utilizing on-demand delivery, effective order management is crucial. With the order management feature, businesses can monitor drivers’ performance, track order status, and manage their operations effectively. This enables them to provide better customer service and make data-driven decisions to improve their delivery processes.

7. Real-Time Messaging

Clear communication between customers and drivers is essential for a smooth delivery experience. On-demand delivery services often offer a real-time messaging feature, allowing customers and drivers to communicate seamlessly. Whether it’s confirming delivery instructions, providing updates, or addressing any concerns, this feature facilitates necessary coordination.

Why On-Demand Delivery is So Popular in 2023

The rise in popularity of on-demand delivery can be attributed to several key factors:

1. Convenience

The primary reason behind the success of on-demand delivery is the unparalleled convenience it offers. Customers no longer have to leave the comfort of their homes or offices to access products or services. With a few taps on their smartphones, they can have their needs met quickly and effortlessly.

2. Time-Saving

On-demand delivery eliminates the need for time-consuming trips to physical stores or service providers. This saves customers valuable time, allowing them to focus on other tasks or enjoy leisure activities. Whether it’s avoiding traffic or skipping long queues, on-demand delivery streamlines the entire process.

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Benefits of On Demand Delivery App and How to create one

3. Increased Accessibility

On-demand delivery has made products and services more accessible to a wider audience. It has opened up opportunities for small businesses and individual entrepreneurs to reach customers who may not have otherwise been able to access their offerings. This increased accessibility promotes economic growth and fosters entrepreneurship.

4. Personalization and Customization

On-demand delivery services often provide customers with options for personalization and customization. Whether it’s choosing specific ingredients for a meal, selecting a preferred delivery time slot, or adding special instructions, customers can tailor their orders to their exact preferences. This level of personalization enhances the overall customer experience.

5. Competitive Pricing and Offers

With the growing popularity of on-demand delivery, the market has become increasingly competitive. This competition has led to competitive pricing and attractive offers for customers. From discounts and loyalty programs to free delivery promotions, customers can enjoy cost savings while still receiving the convenience of on-demand delivery.

Latest trends in On demand delivery

  1. Increased Use of Drones and Autonomous Delivery Vehicles:
    Drones and other forms of autonomous vehicles will continue to be utilized for on demand deliveries. The technology will be more advanced, making it more efficient. Delivery times will be significantly reduced, as these vehicles will be able to navigate traffic freely.
  2. Expansion of Same-Day Delivery Services:
    Retailers will be highly motivated to expand their same-day delivery services in order to stay competitive. Customers have come to expect quick delivery and this trend will continue to encompass more product categories in the coming years.
  3. Growth of Delivery Network Infrastructure:
    Delivery companies will continue to invest in their delivery network infrastructure to improve the experience for customers. This investment will include the implementation of advanced analytics, routing algorithms, and real-time tracking.
  4. Increase in Personalization:
    On demand delivery services will be more personalized to cater to the individual needs of consumers. This trend is driven by increased data availability and the use of artificial intelligence to create more customized delivery options.


As the demand for instant gratification continues to rise, the popularity of on-demand delivery is only expected to grow. So next time you need something delivered, why not give on-demand delivery a try? You won’t be disappointed!

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