Chowdeck, a leading food delivery startup, is making significant strides across eight Nigerian cities, with Lagos accounting for 70% of its orders.
In the bustling Yaba district, known for its innovation ecosystem, an average food order costs around 4,000 naira ($2.50).
However, according to insights from Chowdeck’s CEO, Aluko, this figure can double in some interior parts of Lagos.
Efficiency is key to Chowdeck’s operations.
The company leverages software to analyze customer demand trends and optimize the routing of its delivery riders, who complete an average of 12 orders per day.
Aluko also revealed that Chowdeck has developed a custom digital map using OpenStreetMap to overcome the limitations of Google Maps in providing accurate directions in Nigeria.
Chowdeck’s expansion strategy focuses on ensuring existing cities’ profitability before venturing into new markets. “It takes three to four months for us to become profitable in a new city,” Aluko told Semafor Africa.
The startup’s recent growth underscores the potential of locally developed digital technology services in Africa. While mobile money and cashless payments dominate the continent’s tech scene, the evolving food delivery landscape offers significant growth opportunities.
Chowdeck initially targeted street food vendors offering local delicacies. However, recent growth has been driven by partnerships with popular fast-food chains and promotional discounts.
Aluko describes Chowdeck’s typical user as a young student or worker who “understands the value of time,” with most orders delivered within 30 minutes.
Beyond technological and marketing innovations, Chowdeck and other food delivery services are benefiting from a more mature Nigerian market.
Osarumen Osamuyi, founder of African tech analysis platform The Subtext, suggests that early players like Jumia Food helped build customer trust in online payments, allowing Chowdeck to focus on prepaid transactions.
However, Nigeria’s high inflation rate, currently at 33.4%, poses challenges.
As fuel prices rise, restaurants may pass on increased production costs to consumers, potentially affecting the price sensitivity of food app users.
