We Invite You to Analyze “Robinhood”, a Hot New Food Delivery App; Is It Right for Your Restaurant?
The launch of Robinhood, a sensational new food delivery app by SCB, has shaken the entire restaurant business field, especially since the app’s selling point is that it doesn’t collect GP, which is a painful point for restaurants and the food delivery apps currently dominating the market. As a result, it’s no surprise that. as soon as Robinhood launched and announced that it wouldn’t collect GP, it received positive feedback from restaurateurs. So, let’s help each other analyze what’s interesting about Robinhood and what types of restaurants are a good fit for Robinhood.
- Robinhood: Generous, Free and Quick to Pay
- Trial Period Starts in July and Full Launch Starts in August
- Collaboration with Skootar to Open Initial Service Areas in the Bangkok Metropolitan Region
- Clear Announcement That It Wouldn’t Join in the Delivery Fee Promotion War
- Summary
Robinhood: Generous, Free and Quick to Pay
Robinhood is said to have originated from the Covid crisis. Mr. Athit Nanthawitthaya, CEO of SCB, had to work from home like most people and ordered food through food delivery applications, so he knows some of the problems restaurants have with application service providers, for example, problems with commission fees or 30 – 35% GP, which in the eyes of restaurateurs, especially SMEs, is a high percentage that directly impacts profit.
Another issue is the order payment period for restaurants. Currently, each app has a rather long period when compared to the SMEs’ need to create cash flow. This gave Mr. Athid the idea to create a platform to meet the needs of entrepreneurs, resulting in the creating of the new Robinhood application under the management of Purple Ventures Co., Ltd. established especially for this job. SCB owns 100% of the shares in Purple Ventures, has appointed a skilled executive, Mr. Thana Thianatchariya, and is promoting the following selling points:
- No
- Free registration.
- Restaurants will receive money within one hour of the order’s completion.
- Easy access to SCB’s services.
Trial Period Starts in July and Full Launch Starts in August
After the announcement of Robinhood’s launch, SCB commissioned a team of almost 100 people to develop the application to be as complete as possible and prepared for an unofficial launch at the end of July to test the system before fully launching within August. In the meantime, the app is open for restaurants to register as members.
Collaboration with Skootar to Open Initial Service Areas in the Bangkok Metropolitan Region
As for delivery services or riders, SCB is collaborating with Skootar, one of Thailand’s startups that offers document delivery services in the Bangkok Metropolitan Region. Skootar has about 10,000 riders within its jurisdiction. Although they’ve never offered food delivery services in the past, Skootar’s experiences and infrastructure along with their collaboration with SCB to propel Robinhood forward make it easy for them to enter this field.
There’ll be some limitations in the early stages since Skootar’s network doesn’t cover the entire country. However, at SCB’s level, if they’re serious about it, they probably wouldn’t stop at just the Bangkok Metropolitan Region and a goal for providing services nationwide will surely soon follow.
Clear Announcement That It Wouldn’t Join in the Delivery Fee Promotion War
A lot of people are watching to see if a major bank like SCB entering the food delivery market will create a delivery discount promotion war to compete with the current market dominators. The answer from SCB executives is clear: they will definitely not compete by discounting delivery fees because it’s not good for the market system. What Robinhood will do is support restaurateurs so they can service in the delivery market without having to lower the quality or amount of food. Customers will get the same quality and amount as if they dined at the restaurants. It’s an alternative for customers.
So, what will attract people to use Robinhood’s food ordering service?
When they’re not offering competitive promotions to draw in consumers, the question remains, “Will consumers like it?” Since today’s food delivery market has to admit that customers are already addicted to subsidized delivery fees, don’t forget that food delivery apps used a model where the person ordering pays the delivery fee from the start until there was competition and the business model was changed, so restaurants subsidize the delivery fees. This was the origin of GP, and the model where the delivery fee is paid by the person ordering has practically died out. Now it looks like Robinhood is opting for the old formula where the person ordering pays for the delivery, so the big question is, “Will that be okay?”
One method Robinhood is using is inviting restaurants to subsidize the delivery fees. Since they don’t have to pay GP fees, they can use that expense for part of the delivery fee, so customers don’t have to pay the whole fee. If they originally have to pay apps 30 – 35% in commissions, they can offer promotions where they help pay less than 30% of the delivery fees and they’ll still make some profit.
Summary
The launch of Robinhood is good for the restaurant business. Although we might not see a ruthless competition with the market dominators, from the restaurateurs’ perspective and with the offers at the app’s launch, they are ready to commit to Robinhood. If you ask us what types of restaurants are a good fit with the app, the answer is every type. However, the questions for the future are as follows:
- The limited delivery area in the initial stages covering Bangkok and some of the surrounding provinces.
- And without collecting GP or delivery fee subsidization, would it be challenging for customers ordering the food?
Nevertheless, with the available information to date, we have to say that we haven’t seen the details of Robinhood’s business model. This analysis is only an opinion based on the available information. However, you better believe that, at the bank level, if they think about investing in something, it’s definitely not just for fun because, for all the money invested, they have to answer the investors and shareholders’ question about what it’s for. For now, let’s see if Robinhood really lives up to the name of the generous outlaw.
Restaurants interested in signing up with Robinhood can do so via the following three channels: SCB branches, onboard.robinhood.in.th and the call center 02-777-7564.
Images from: SCB and SKOOTAR
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