Balancing affordable delivery fees while keeping delivery riders motivated is a challenge for food delivery companies. The recent rise in fuel prices due to inflation has added complexity to this balance, prompting strategic adjustments at these startups.
For instance, one delivery platform has introduced a weekly bonus of ₦2,000 for riders on top of their regular earnings. Riders can earn this bonus multiple times a week based on meeting certain targets. Another company has implemented performance-based incentives, offering bonuses for delivering a certain number of orders within a specified period.
As fuel costs continue to increase, some companies are considering transitioning to dynamic pricing models to cope with these changes. However, concerns remain about passing these additional costs on to customers.
In the face of rising inflation, delivery workers are advocating for higher pay, while companies are cautious about increasing prices for consumers. This dilemma has put the sector in a challenging position.
Moreover, the possibility of transitioning to electric vehicles (EVs) to reduce fuel costs is being explored by some companies. While this switch could lead to significant savings on fuel and maintenance, the upfront costs and existing investments in petrol-powered vehicles pose obstacles to this transition.
Overall, with delivery services navigating through economic challenges and evolving market dynamics, finding a sustainable equilibrium between costs, compensation, and customer satisfaction remains a pressing issue.