Assignment 2 - Model

Strategic Audit Report
Delivery Hero / Talabat
By
Ahmed Hashem Abd El-Moaty

(Reg. No – Mod Online 20)
Supervised By
Dr. Khaled Bekhit
Date
August, 2021
Strategic Audit Report ESL 63 Modular – Gr. B Ahmed Hashem Abd El-Moaty - Mod Online 20
Contents
1. Business Profile ............................................................................................................................... 3
2. Vision .................................................................................................................................................. 3
3. Mission................................................................................................................................................ 4
4. Values.................................................................................................................................................. 5
5. Product & Service ............................................................................................................................ 5
6. Business and Local Partners ........................................................................................................ 5
7. How local partners (Talabat) do business? .............................................................................. 5
8. The Company Goals ........................................................................................................................ 6
9. History ................................................................................................................................................. 6
10. Acquisitions................................................................................................................................... 8
11. Delivery Hero’s Competitors Profile ....................................................................................... 9
12. SWOT Analysis ........................................................................................................................... 11
13. Internal Factors Evaluation (IFE) ........................................................................................... 14
14. VALUE CHAIN ANALYSIS ........................................................................................................ 15
15. Resource Based View (RBV) ................................................................................................... 22
16. DELIVERY HERO VRIO ANALYSIS ........................................................................................ 23
17. MACRO ENVIRONMENT ANALYSIS – PESTEL ANALYSIS ............................................ 24
18. External Factors Evaluation (EFE) ........................................................................................ 27
19. Competitive Profile Matrix (CPM) ........................................................................................... 28
20. SWOT Matrix ................................................................................................................................ 29
21. The Strategic Position and Action Evaluation (SPACE) Matrix ..................................... 31
22. Portfolio Analysis: BCG Matrix .............................................................................................. 33
23. Internal External Matrix: ........................................................................................................... 34
24. Grand Strategy Matrix ............................................................................................................... 35
25. Quantitative Strategic Planning Matrix (QSPM) ................................................................. 36
26. Delivery Hero’s Strategies ....................................................................................................... 38
27. Delivery Hero’s Managing Change and Innovation........................................................... 39
28. Financial Performance .............................................................................................................. 40
Submitted to – Dr. Khaled Bekhit Page 1 of 54


1. Business Profile
Delivery Hero SE is a European multinational online food-delivery service established In May
2011, based in Berlin, Germany. The company operates in 40+ countries internationally in
Europe, Asia, Latin America and the Middle East and partners with 500,000+ restaurants.
Headquarters are located in Berlin, boasting around 1,500 employees in HQ alone. Diversity is
a key pillar for our success. Employees with over 90 nationalities across 5 continents work for
us, enabling us to exchange best practice from markets from each corner of the world.
While Delivery Hero is headquartered in Germany with offices worldwide, as a "gig economy
company" (akin to Uber or Airbnb) nearly all of the company's deliveries are carried out by
workers using bicycles and cars, dispatched via the company's smartphone apps.
Delivery Hero is the world’s leading local delivery platform. The company holds a strong
position in 36 out of 42 countries in which it operates across Europe, Latin America, Asia-
Pacific, the Middle East and North Africa in terms of restaurants, active users, orders,
online and mobile platforms. Delivery Hero also operates its own delivery service primarily
in over 530 cities around the globe. Headquartered in Berlin, Germany, the Company has
over 22,000 employees.
2. Vision
“Always Delivering an Amazing Experience – Fast, easy and to your door”
Deliver Hero vision aspires to create an amazing takeaway experience, by offering:

 Amazing food by ensuring we have the right quantity, quality and variety of restaurants in
every neighborhood
 Amazing ordering by ensuring that our ordering experience is convenient inspirational,
simple and personalized
 Amazing service by ensuring that our food is delivered quickly, reliably and can be tracked
in real-time
The vision is clear and concise, directly related to company’s main business and
includes many other area for new feasible businesses opportunities that in can be
achieved.
This vision has been reflected in the company's e-commerce and technological
applications and related products and therefore relevant strategies.
3. Mission
The world’s leading local delivery platform to transform the way people order food.
Delivery Hero is offering choice, convenience reliability and quality, by becoming the easiest
way for our customers to discover and order food online.
Delivery Hero ecosystem’s a mission is to deliver anything and to work with a large global
ecosystem of riders, restaurants, shops and partners. From prepared meals to groceries,
flowers, coffee, medicine… our fleets deliver whatever you need – fast, easy and to your
door.
According to the mission statement criteria, Delivery Hero’s mission statements,

includes the following:
 Technology, which is reflected in the Online Platforms for ordering
commodities.
 Products & services it offers, which is reflected in the delivery concept to
customers.
 Competitive advantage, which is reflected by its strong position in 36 countries
and 530 cities around the globe, its operation across Europe, Latin America,
Asia-Pacific, and its huge number of employees (more than 22,000 employees).
 Social Responsibility of providing the safer and cleaner world, the market which
is the whole world, the customer by offering tailor made solutions.
The mission statement ignored the profitability, the employees and philosophy
which are the basic believes & values.
This mission statement has been translated into strategies and action plans. For

instance, in order to emphasis the social responsibility, Delivery Hero promoted its
ecosystem which aimed to keep communities safe, healthy reduce any activities
that will endanger the environment.
4. Values
 We deliver solutions
 We always aim higher
 We are Heroes because we care
5. Product & Service

Delivery Hero is a provider of a platform for online food ordering and delivery.
It enables users to find local restaurants, filter by cuisine, browse menus, read reviews and
other information, like the restaurant operating times, and order takeaway food online.
Delivery Hero has increasingly moved beyond food delivery, expanding into new vertical
markets including groceries and pharmaceuticals.
The company has described its logistics model as quick commerce, meaning the delivery of
small batch orders in under an hour.
6. Business and Local Partners
The Delivery Hero brand contains multiple international brands.

In Asia and Eastern Europe, it is Food Panda, in Europe, Canada, and Australia it is Foodora,
in the Middle East it is Talabat, and in Russia, it is Delivery Club, etc.
7. How local partners (Talabat) do business?

Talabat is the largest online food ordering platform in the Middle East. It operates across
the GCC (Kuwait, Saudi Arabia, Bahrain, United Arab Emirates, Oman, and Qatar) and
Jordan. Users can order from over 4,300 restaurant partners.
Restaurants on Talabat benefit from an online ordering presence and are the alternative
to telephone orders and pickup options.
Talabat users have access to thousands of restaurants according to the user’s location
and the restaurants in the area while filtering by cuisine, ratings, delivery time, minimum
order value, payment options or restaurant name. Placed orders are sent to the
restaurant’s point of sale machines, processed and then delivered to the customer’s
address.
The service is free to users without any charges. However, variable amount of delivery
charges may be incurred depending on the restaurant receiving the order.

8. The Company Goals

 To be one of the leading global online food ordering and delivery marketplaces
 Work on efficiency across all stages of food delivery to decrease delivery times.
That means driving to vendor, time at vendor, driving to customer, and
delivering the order.
 Offer our customers the most and best choice possible, and this comes in many
shapes and forms.
 Orders and payments can conveniently be placed online and restaurants are
peer-reviewed, making it easier to choose the best restaurant every time.
 Continuously transforming the way people order food online. In essence,
visiting our platforms is the easiest way to your favorite food.
9. History
May 2011
 In May 2011, Delivery Hero established and began the journey of building a
leading global business in online food ordering.
 The founding team, completed by members of Team Europe, shared decades
of knowledge of working with internet companies.
 Delivery Hero then raised €25 million in new funding to finance acquisitions in
four European countries: Sweden, Finland, Austria and Poland.
2012 and 2013
 In early 2012, the enterprise acquired “Lieferheld” in Germany and acquired a
stocks in “Foodarena”, Switzerland.
 In August 2012, Delivery Hero started expanding in both South Korea and
China through “YoGiYo” and “Aimifan” and the Asian expansion continued in
2013 when Delivery Hero increased investment in “TastyKhana”.
August 2014
 Delivery Hero acquired a controlling stocks in the Latin American market leader
“PedidosYa”
 Delivery Hero acquired German market leader and rival, “pizza.de”.
April 2015
 Delivery Hero acquired South Korean delivery service “Baedaltong”, one of the
chief competitors of its own “YoGiYo Service”.
 Delivery Hero bought the Turkish competitor “Yemeksepeti” for 530 million
Euro, which was the largest acquisition in this business sector to date.
 In October 2015, Delivery Hero acquired Munich-based food delivery service
“Foodora” from Rocket Internet.
 In November 2015, Delivery Hero acquired Middle East based food delivery
service “Talabat”

December 2016
 Delivery Hero acquired “Food Panda’, a company valued at an estimated
$3 billion at that time.
 The company announced the sale of its UK business “Hungry House” to
“Just Eat” for at least £200m.
October 2017
 Delivery Hero acquired Middle East and North Africa food services “Carriage”,
in addition to Food Delivery services based in Egypt ”Otlob”
 Delivery Hero went public in a listing on the Frankfurt Stock Exchange on 30
June 2017.
 The listing was the largest by a European technology business in almost two
years.
 Delivery Hero raised almost €1bn from the offering.
December 2018
 Delivery Hero sold their German operations to “Takeaway.com”.
 Delivery Hero acquired Middle East based food delivery service “Zomato Food
Delivery”

10. Acquisitions
 2011: Hungry house (UK)
 2012: Lieferheld (Germany), Online Pizza (Sweden), Pizza Portal (Poland), Pizza-Online
(Finland)
 2014: PedidosYa, Click delivery (Latin America), Pizza.de (Germany), Baedaltong (Korea)
 2015: Talabat (MENA), Yemeksepeti (Turkey), E-food (Greece), Damejidlo (Czech Republic),
foodora
 2016: food panda
 2017: Otlob ( Egypt) ,Carriage (MENA), Appetito24 (Latin America), Foodfly (Korea)
 2018: Hipmenu (Europe), Netcomidas (Bolivia)
 2019: Zomato food delivery business (MENA)

11. Delivery Hero’s Competitors Profile
Founding
2011 2011 2004 2012 2001
Date
Valuation
20.3b 2.4b NA 2b NA
(EUR)
o Food & o Technology o Food & o Food & o Food &
Beverage o Delivery Beverage Beverage Beverage
o Technology o Logistics o Technology o Technology o Technology
o Delivery o Platform o Delivery o Delivery o Delivery
Line of
o Ecommerce o Shipping o Mobile App. o Marketing o Ecommerce
Businesses o Restaurant Analytics o Restaurant
o Restaurant
o Mobile App
o Restaurant
o Europe
o Europe
o Europe o Australia
o Asia
o USA o Australia o South
Operating o MENA o USA
o Canada o Far-East America
Regions o South
o MENA o Canada
America
o New Zealand
Employees Approx. 23K Approx. 5.7K Approx. 2.7K Approx. 5.5K Approx. 4.8K
85 k (Q2, 80 k (May, 75.4 k (Q2,
Restaurants 150 k (FY, 2016) N/A
2018) 2019) 2017)
T. funding
$ 2.6b $ 903m $ 284.1m $ 1.5b $ 129.1m
raised

COVID 19 PANDAMIC EFFECT
COVID-19: ADAPTING TO THE NEW REALITY WHILE KEEPING EVERYONE SAFE

As a key delivery player in the countries it operates in, Delivery Hero supports the entire
delivery ecosystem to keep communities safe, healthy and fed during the COVID-19
pandemic. We are working closely with both regulators and governments to help secure
the delivery of food, groceries and pharmacy supplies. Specifically, the company has
implemented no-contact delivery, contactless payments and heightened hygiene
standards to protect vendors, riders and customers alike. To keep local businesses
running during an economically challenging time, Delivery Hero is focused on enabling
orders for restaurants and other partners through faster onboarding processes and
focused marketing efforts. In addition, it has supported the businesses’ liquidity by
increasing the frequency of payouts. Most recently, Delivery Hero has launched a EUR 3
million support program to provide riders with financial assistance during the pandemic.
Delivery Hero is also supporting local communities where possible; for instance by giving
out more than 1,000 free meals per day to healthcare workers fighting the virus.
UNCHANGED GROUP OUTLOOK

The COVID-19 pandemic is rapidly evolving and markets have been affected in various
ways globally. Delivery Hero’s global set-up and ability to quickly adapt to potential long-
term changes in customer behavior has put the company in a strong position to continue
to deliver against its goals. The company expects customer acquisition growth to
accelerate notably as the pandemic leads to customer expansion beyond typical prior
demographic segments. This, in turn, extends the market opportunity for online food
delivery in the long-term. At this stage, there is no change to the group guidance. Delivery
Hero continues to expect to achieve FY 2020 revenues of between EUR 2.4 billion and
EUR 2.6 billion, reflecting a growth rate of around 70% YoY. Adjusted group EBITDA is
expected to be between -14% to -18%. This includes an up to EUR 50 million negative
impact on adjusted EBITDA in MENA for the full year 2020, resulting from COVID-19
related costs. These COVID-19 related costs will be absorbed in the group guidance. The
flexibility of previously announced additional investments of up to EUR 200 million is
intended to opportunistically extend Delivery Hero’s leadership positions, where required.
Adjusted EBITDA for MENA is expected to remain higher in 2020 than in 2019 and is
expected to remain break-even for Europe for the full year 2020.
Despite the current economic environment in the global markets, Delivery Hero outlook
for 2020 and 2021 did not change, this is due to their ability to apply technology and
market know-how to quickly adapt to changed circumstances.

12. SWOT Analysis
SWOT analysis involves internal which is strengths and weaknesses within the company
and external which is opportunities and threats within the company.
Strengths Weaknesses
 Excellent Platform  Orders from nearby restaurants
 Online Ordering  Tap on the Free Delivery
 Investments  More areas to cover
 Various International brands  Competition with other similar
 Global Operations applications.
 Quick Delivery  Costly delivery, slow delivery
 Trained Employees  Unclarity of the occasional food
 Wide Coverage selection options.
 Good Customer Support  The only available restaurants located
 Worldwide brand image. in the order area have orders.
 Convenient online delivery service.

 Easy to browse and user-friendly wide

variety of menu.
 Employees (i.e. drivers, accounting
team) are trained to be good drivers
first, then good delivery drivers. They
have grown into one of the largest
reservation portal. Delivery driver must
be trained to be polite and professional
in their interactions with customers and
suppliers. Delivery driver have an
application through which their
performance is carefully measured.
 KPIs – the more positive feedback a
delivery driver received, the more
orders they receive.
 Wide coverage of restaurant. They
have delivered food in 23 countries and
more than 500 cities around the world
(Reuters 2015).
 Wider variety of food options available
from anywhere to a user's home and
takes advantage of regular
restaurants, which focus on serving
food from their own restaurants.
 Large Market Share and dominant
competitiveness power.
Opportunities Threats
 Growing Market  Increased Potential
 Customer Expansion  Low Customer
 Increase in Customer Loyalty  Change in economic condition
Programs  Ease of going to the nearby restaurant
 Further Expansion to more cities and  Competition has gradually increased,
countries. gradually threatening its position like
 Improving the delivery time Domino's pizza, McDonald's,
 Adequate systems to be added to the PizzaHut, Deliveroo, UberEats and so
food distribution network to ensure that on.
customers get fresh and hot food

 Emerging markets in world. Example, Deliveroo was founded in 2013 and is

Foodpanda started expanding in headquartered in London. Deliveroo is
Russia three years ago and acquired committed to providing high-end food
Delivery Club in mid-2014 at an delivery services, refusing to work with the
undisclosed price low-end restaurant and promises to deliver
food to the door within 32 minutes. Up to
now the service covers more than 50 cities
in 12 countries and more than $5000
cooperative restaurant.
UberEats was launched by Uber as a pilot

in 2014 and is part of a series of
experimental services from Uber. Uber
uses a network of millions of Uber drivers
around the world. In cities where UberEats
operates, Uber drivers can carry
passengers and deliver food. Foodpanda.
At present, foodpanda has a low customer
base.
Health Issues – Increasing obesity rates

and potential competitors. Foodpanda's
neglected potential competitors pose a
significant threat over time.

13. Internal Factors Evaluation (IFE)
Key Internal Factors Weight Rating Weighted Score
Strengths
1) Excellent and friendly Online Platform 0.10 4 0.40
2) Various International Investment 0.07 3 0.21
3) Quick Delivery 0.06 4 0.24
4) Trained Employees 0.05 3 0.15
5) Wide Coverage 0.04 1 0.04

6) Good Customer Support and Trained
0.03 3 0.09
Employees
7) Wider variety of food options 0.06 3 0.18
Weaknesses
1) Orders from nearby restaurants 0.10 2 0.20
2) Tap on the Free Delivery 0.08 2 0.16
3) More areas to cover 0.08 2 0.16
4) Competition with other similar applications. 0.07 1 0.07
5) Costly delivery, slow delivery 0.05 2 0.10

6) In clarity of the occasional food selection
0.12 3 0.36
options.
7) The only available restaurants located in the
0.09 1 0.09
order area have orders.
Total 1 2.45

14. VALUE CHAIN ANALYSIS
I. Primary Activities
a) Inbound Logistics & Procurement:
b) Operation:
 Market broadening, and Market diversification over new territories
 Horizontal Integration by acquiring and controlling competitors
 Customer Acquisition And Retention Boosted By Improved Service – Delivery Hero is
accelerating investments to increase customer loyalty brought about by its extensive
platform of consumers, vendors and riders. The company’s offering now includes
more choice with over 500,000 restaurants on its platform – the widest and most
diverse selection globally outside of China. Delivery Hero offers faster and more
reliable delivery with an improved seamless ordering experience that includes an
expanded footprint across multiple verticals, including groceries. The demand for
groceries has increased substantially as a result of the COVID-19 pandemic. Delivery
Hero has responded by adding 1,500 vendors to its platform during the last three
weeks of March, and by continuing to reduce the average delivery time (currently less

than 28 minutes, a 20% reduction from last year). In addition, it has increased its own-
delivery share of overall orders (currently at 52%). The company continues to increase
the number of vendors and improve delivery services in Q2 2020.
c) Outbound Logistics:
d) Marketing And Sales – Strong Growth In Quick Commerce (Q-Commerce)
 Delivery Hero – Quick Commerce – Against the backdrop of a significant change in

customer behavior and the increasing importance of new categories such as groceries
and pharmaceuticals.
 Delivery Hero is pioneering the quick commerce (q-commerce) category – the next
evolution of e-commerce.
 Q-commerce provides ultra-fast deliveries, with Delivery Hero having achieved
delivery times of often less than 20 minutes of ordering from an affiliated store. The
company has more than 100 Dmarts (local warehouses or often also called Cloud
Stores) across MENA, Asia and Americas and this has led to a substantial boost in
both orders and new customers.

 This fast-growing category offers enhanced choice at any time of the day and is
suitable for single-person households.
 Improved affordability and profitability are achieved through technology, automation
and data driven item selection, all of which enhance the consumer experience.
 The advantage of q-commerce and Delivery Hero’s Dmarts is faster delivery leading
to high customer satisfaction, which resulted in 218% monthly growth in customer
acquisitions and 26% order growth in March.
 Delivery Hero achieved this at close to zero marketing due to the surge in demand for
online delivery during times of social distancing.
 The q-commerce market offers significant potential for the continued growth of
Delivery Hero.
 Driving marketing innovation: key trends – This fall our World Marketing Meeting took
place in sunny Istanbul, at the headquarters of our Turkish brand Yemeksepeti. Our
marketing experts from all over the world came together to collaborate on global
strategy, exchange knowledge and align on next steps for driving company innovation
and growth. We caught up with some of them to find out which topics they highlight
as being key drivers of growth in marketing.
 Consistency and automation - Michael Wicke, VP International Marketing, points to
consistency as a key pillar of growth. “Being consistent in brand communications is
important in a highly competitive environment,” Michael says. “Communicating
consistently across all channels ensures a clear and efficient installation of our brands
within their target groups which helps to differentiate clearly from competition.”
Continuing to leverage automation is also set to be a main driver of finding further
efficiencies in performance marketing and CRM (Customer Relationship
Management) channels, according to Michael. “Even though we are already running
at a high level of sophistication, there are opportunities for automation to drive further
growth over the next year,” Michael says. “Put simply, automation can replace
repetitive, manual tasks with automated processes that follow certain algorithms. This
way we increase efficiency and free up time to focus on more complex and strategic
tasks.”

 Winning the streets – Victoria Robinson, Director Marketing Delivery Hero Austria, says
winning the streets (in other words, making sure our customers recognize and know
our brands) is crucial amidst our hyper growth as a business, especially in emerging
markets. This can be achieved by effective and strong communication campaigns –
branded delivery riders, branded restaurant merchandising material and local offline
activations including flyer as well as sponsoring local events and partners. “Making
communication more emotional and ‘human’ can have a great impact on brand loyalty,
and freshening up the look and feel of established brands can really inject some new
energy,” Victoria says.
 Data & bigger ideas – Ross McPheat, Head of International Marketing, highlights data
and big ideas as major drivers of change in marketing. “Our CRM marketing has
evolved massively in the last year. Data enables us to leverage personalization and
creates opportunities to talk to our customers in a more relevant way,” Ross says. It’s
important to remember to think big and launch big campaigns, to remind users of our
brand and keep them engaged, Ross points out. This helps to avoid people from
categorizing our platforms as something static and boring. “By really investing in in-
house tool development, automation, and data modelling, we can improve our
marketing tech function,” Ross adds. “This will revolutionize how we work and is the
next step for Delivery Hero on our way to becoming a world leader in marketing best
practice, and it’s really exciting to see this recognized and invested in by the business.”
II. Support value Activities:

a) Firm Infrastructure:
 The company operates in 40+ countries internationally in Europe, Asia, Latin
America and the Middle East and partners with 500,000+ restaurants.
 Headquarters are located in Berlin, boasting around 1,500 employees in HQ alone.
Diversity is a key pillar for our success. Employees with over 90 nationalities across
5 continents work for us, enabling us to exchange best practice from markets from
each corner of the world.
b) Human Resources management:
Collaboration

Anthony Estephan, Performance Marketing Manager for Talabat and Otlob, sees
teamwork and collaboration as crucial ingredients for growth and innovation.
Our marketing experts from our brands across the globe came together at our
Yemeksepeti office in Istanbul “Building synergies between teams is the key driver
to improve marketing campaigns,” Anthony says. In particular, a closer alignment
between Marketing and Product can enable collaboration on questions and issues
to find the best solution together.
“This cooperation will enable Marketing to build a product that will answer to the
business needs and KPIs, and help us become market leaders,” Anthony says.
“Investing in Marketing Tech and Product Marketing is what will drive growth within
the company.”
Equally, an increasingly close collaboration between Marketing and Sales enables
us to onboard the best restaurants, Anthony notes. As a result, high quality
restaurants drive a positive customer experience and as such improve our
retention rates.
Of course, this is all within the framework of fostering and strengthening our global
collaboration across our brands, Anthony says. “Events like the World Marketing
Meeting reinforce this feeling of being a global community where learning,
knowledge sharing and growth is fundamental.”
How Delivery Hero Manage Their Global Employee Engagement Strategy

Delivery Hero is a food delivery service that operates in over 40 different countries
around the world. Though their name might not be immediately recognisable, you’ll
almost certainly be familiar with some of the 28 brands they operate, which include
PedidosYa in Latin America, foodora across Europe and North America, and
foodpanda in Asia. In May 2018, Delivery Hero went public on the Frankfurt Stock
Exchange. Now a company with over 17,000 employees in five continents,
Delivery Hero face the challenge of maintaining their success despite the
difficulties that come with having a dispersed, global workforce.

Giving managers the insight to address regional priorities
Empowering managers. Every manager at Delivery Hero has access to their own
Peakon dashboard, which provides them with the insights needed to address
specific issues within their own teams. This allows managers to quickly resolve
local issues as they arise, while also collaborating with People Operations on
larger strategic projects. Delivery Hero use Peakon’s Actions feature to support
action-planning and collaboration across the organization. Actions
Overview provides HR and leadership with a view of all the initiatives being taken
by the managers who report upwards to them, and allows them to monitor
progress, provide relevant support, and hold managers accountable for
implementing the organization’s people strategies.
The company has also incorporated Peakon into their manager training so that
every manager feels able to interpret and action their feedback. This was
particularly important when managers first started using Peakon. As Dana
explains, “Peakon results will not always be favorable. I know that whenever
managers had a lot of red in their reports, we had to tell them ‘It’s OK. That’s
actually where innovation happens.’” Giving regional managers the training and
autonomy to address problems, without having to wait for guidance from HQ,
allows them to solve issues quickly and effectively. It also gives them an
opportunity to apply their local expertise and develop a plan of action that accounts
for cultural differences.
Why Delivery Hero made employee engagement a global KPI?

Increasing the capability of managers and empowering them to drive improvement
in employee engagement is an integral part of Delivery Hero’s people strategy. In
order to ensure that everyone in the business buys into this vision, Delivery Hero
have incorporated their engagement metrics into their organizational KPIs. Firstly,
this sends a clear message to everyone at Delivery Hero that the organization
cares about its people, and secondly, it promotes a culture in which every people

leader feels responsible for taking action on employee feedback. Peakon has given
Delivery Hero the tools and insight needed to keep the company aligned from a
global perspective, while empowering managers to create tailored local solutions.
c) Technology:
 Deliver Hero developed user friendly application / platform.
 Innovation in smartphone technology has led to a growth of 21% in the 16-24 age
group uses services like Delivery Hero.
 Innovations in the development of a custom applications has allowed Delivery Hero
to create a low-maintenance workforce who can be easily communicated via one
app. That has led to a reduction in traditional delivery service set-up costs and
helped Delivery Hero become market leaders.
 Peakon Technology – The biggest challenge that Delivery Hero immediately faced
was in understanding the daily experience – and levels of engagement – of more
than 17,000 people across the globe.
 The organization needed to find a solution that allowed them to collect regular
employee feedback in multiple languages, and that could provide insight on the
entire business. That responsibility fell to Senior Manager, Strategic Projects –
based at the company’s HQ in Berlin.
 Delivery Hero introduced a technology / online application namely “Peakon”, which
enables senior leadership team in Berlin to understand and get real-time feedback
and issues encountered from employees around the world.

15. Resource Based View (RBV)
A. Physical Resources:
 Efficient Branches in 530 Cities Globally.
 Very Modern and innovative technology such as IQ Routes technology.
 Owned maps supplier Tele Atlas.
 Centralized R&D resources.
 Accurate real-time information technologies.
B. Human Resources
 Diverse labor force.
 Talented workforce.
 Highly motivated.
 Many talent, skills & capabilities development programs.
C. Organizational Resources
 Independent nature
 Powerful information system.
 Well-known Brand.
 Strict corporate governance.
 Registered innovation trademarks.

16. DELIVERY HERO VRIO ANALYSIS
Organized to
Resource/Capability Valuable Rare Inimitable Capture

value
Efficient Branches in 530 Cities
Yes Somewhat Somewhat Yes
Globally
Very Modern and innovative
Yes Yes No Yes
technology
Centralized R&D resources Yes No No Yes
Diverse labor force. Yes Somewhat Somewhat Yes
Talented workforce. Yes Somewhat No Yes
Highly motivated. Yes No No Yes
Many talent, skills & capabilities

Yes No No Yes
development programs
Independent nature Yes No No Yes
Powerful information system Yes Yes Somewhat Yes
Well-known Brand Yes Somewhat Somewhat Yes
Strict corporate governance Yes Somewhat No Yes

17. MACRO ENVIRONMENT ANALYSIS – PESTEL

ANALYSIS
Delivery Hero maintains developing the strategies and set objectives that ensure
an optimal balance between the growth of its business, and the mitigation of
associated risks.
Political
Delivery Hero operates business mainly in 4 geographical segments, which located in 39

Countries, in 6 continents, hence political uncertainties among various operating regions
is major player in the PESTLE analysis for Delivery Hero.
The services & order platforms are suited to match the local market demand and
respective competition situation in each area.
According to that geographical diversity, Delivery Hero faces a legal risk that may resulted
consequently of any change in the governmental decisions & policies in any of those
counties where Hero is operating businesses.
Various Governments including and not limited to European (EU) has been urged by
online-food ordering platforms to loosen immigration rules to allow for more curry chefs
to meet demands in the restaurant sector, e.g. currently visa decisions are informed by
EU laws, this is set to be tightened when the UK leaves the EU.

Various Governments are investigating the modern employment practices for online-food
ordering platforms and stating that these companies pay should link more closely to the
minimum wage. Currently companies operating in the UK like Deliveroo do not fall under
the minimum wage laws and use this advantage to keep prices competitive.
In some countries applying the Federal Governmental System e.g. United Arab Emirates
(UAE) consists of 7 emirates, each of which has individual governmental organizations.
Each has flexible policies to enable entrepreneurs start an online food ordering business
without any hassle or restriction.
Economic
Global Growth decelerated in 2019, with continued weakness in global trade &
investment. However, as of December 2019, global growth was expected to recover to
2.5% in 2020.
The outbreak of Coronavirus diseases will have effects on global growth.
In 2020, it was analyzed that global might be significantly by the worldwide outbreak of
the Coronavirus (COVID-19) and might drop by 0.5% to 1.5% compared to initiate
expectations.
The growth will differ from region to another according to the economic recovery in each
country.
The online spending on food and drinks per capita in MENA region is exceeding $50.
MENA region’s food and beverage market is worth more than $20 billion.
According to KPMG, 70 percent of MENA region consumers use a mobile application to
order food.
Other factors including Rising Fuel Costs, Rising Salaries and Competition.
Socio-Cultural
The global trend moves toward more penetration of technology, acceptance of internet
commerce in the food industry, and positive buying habits. Food ordering and delivery
mobile apps have been a major factor in it. From choosing a restaurant to placing an
order, customers are doing everything using a mobile app.
The 21st century has shown a clear Sociocultural trend towards healthy eating. Unhealthy
“junk” food is no longer in fashion, while body-conscious salads, shakes, and snacks are
taking over. This trend towards making healthier dietary changes is an extremely
important, since adapting to consumers’ demands is absolutely imperative to long term
success, thus, Delivery Hero managed to increase its partnership with food suppliers
specialized in organic, vegetarian and less fatty food items.
Technological
Innovation in smartphone technology has led to a growth of 21% in the 16-24 age group
uses services like Delivery Hero.

Innovations in the development of a custom applications has allowed Delivery Hero to

create a low-maintenance workforce who can be easily communicated via one app. That
has led to a reduction in traditional delivery service set-up costs and helped Delivery Hero
become market leaders.
Currently, consumers order more food from mobile apps as compared to websites.
Delivery Hero operates websites, platforms, payment solutions and other data processing
systems, which rely of the security of their systems.
Any breaches in handling data of their partners or any misuse of the client information
may result in material reputational damage.
IT security risks, in particular cybersecurity, remain the biggest inherent risk of Hero’s
business.
As online business, Delivery Hero depend on functionality, security & stability of their
websites & order platforms, internet connections, any short system downtime can lead to
high financial losses.
Environmental
Through the emphasis of using a verities fleet solutions of bicycles and scooters, Delivery
Hero operates an environmentally friendly service which aims to reduce congestion and
pollution when compared to cars and other delivery vehicles.
Delivery Hero is focusing on having sustainable and compliant food chains.
Legal
Delivery Hero operates business mainly in 4 geographical segments, that located in 39
Countries, in 6 continents, hence, various laws and regulations provisions among various
operating regions is major player in the PESTLE analysis for Delivery Hero including and
not limited to the following:
Discrimination Laws
Antitrust Laws
Employment Laws
Consumer Protection Laws
Health and Safety Laws.

18. External Factors Evaluation (EFE)
Key External Factors Weight Rating Weighted Score
Opportunities
1) Growing and Expand Markets 0.10 4 0.40
2) Customer Expansion 0.08 4 0.32
3) Increase in Customer Loyalty Programs 0.12 3 0.36
4) Improving the delivery time 0.07 2 0.14

5) Adequate systems to be added to the food
distribution network to ensure that 0.08 2 0.16
Threats
1) Increased Potential 0.12 1 0.12
2) Low Customer 0.10 1 0.10
3) Change in economic condition 0.11 3 0.33
4) Ease of going to the nearby restaurant 0.10 3 0.30
5) Competition by global food chains. 0.12 3 0.36
Total 1 2.59

19. Competitive Profile Matrix (CPM)
Key competitors of the company include Delivery Hero, Sononu and Bee Delivery. The
Competitive Profile Matrix (CPM) identifies a firm’s major competitors and its particular strengthes
and weaknesses in relation to a sample firm’s strategic position.
Delivery Hero Sononu Bee Delivery
Critical success factors weight rating score rating score rating score
Brand recognition & Reliability 0.05 4 0.2 4 0.2 4 0.2
Mobile Application 0.05 4 0.2 3 0.15 3 0.15
Household commodities 0.05 4 0.2 3 0.15 3 0.15

Partnerships with mobile
networks and new car 0.05 4 0.2 4 0.2 3 0.6
Manufacturers.
Partnerships with various 0.2
0.05 4 4 0.2 4 0.2
restaurants
Cost of Delivery 0.05 4 0.2 4 0.2 3 .0.15
Weak distribution 0.2 4 0.4 4 0.8 3 0.6

Expansion in emerging
0.4 4 0.8 3 1.2 2 0.8
economies markets
Increasing competition
especially in smart phone, and 0.1 3 0.3 1 0.1 1 0.1
online navigation applications
Potential adverse legislation 0.05 3 0.15 2 0.1 2 0.1
Total 1 3.3 2.75 2.55

20. SWOT Matrix

Strengths Weaknesses
1) Excellent and friendly Online 1) Orders from nearby
Platform restaurants
2) Various International 2) Tap on the Free Delivery
Investment 3) More areas to cover
3) Quick Delivery 4) Competition with other
4) Trained Employees similar applications.
5) Wide Coverage 5) Costly delivery, slow
6) Good Customer Support and delivery
Trained Employees 6) In clarity of the occasional
7) Wider variety of food options food selection options.
7) The only available
restaurants located in the
order area have orders
Opportunities SO Strategies WO Strategies

1) Growing and Expand  Make partnerships with  Introducing low cost
Markets Mobile Networks, delivery solutions for
2) Customer Expansion Application Developers, food and various
3) Increase in Customer Transportation means household items.
Loyalty Programs Manufacturers.  Study, plan and
4) Improving the delivery time minimize the territories in
5) Adequate systems to be  Use experience & each city to decrease the
added to the food reliability to develop new waiting and delivery
distribution network to markets, new food time.
ensure that customers get solutions and delivery  More usage for reliable
fresh and hot food solutions for other and user friendly mobile
household commodities applications.
 Use its reliability, R&D  Develop continuous
to develop autonomous promotion campaigns.
drive navigation  Increase the restaurant
software to limit the and food cuisines
delivery time. options.
 Use R&D to innovate and
lead the connected
digital life for ordering

various commodities and

delivering solutions
 More attention to the e-
commerce concept to
meet the consumers /
household objectives.
Threats ST Strategies WT Strategies

1) Increased Potential  Product Diversification  Product development by
2) Low Customer  New Markets focus on cutting edge
3) Change in economic  Territories coverage technologies will mitigate
condition  Enable partnership with competition with smart
4) Ease of going to the various restaurants and phones and widen
nearby restaurant cuisines product rage.
5) Competition by global  Market development in  Open more branded
food chains other emerging stored at emerging
economies. economies countries.
 Market development in
emerging economies will
increase sales revenue
and reduce probability of
adverse legislation and
overcome markets
saturation.

21. The Strategic Position and Action Evaluation (SPACE) Matrix
Internal Strategy Position External Strategy Position

X Axis
CP (Competitive Position) IP (Industry Position)
# Factor Value # Factor Value

1 Product Quality -1 1 Barriers to Entry 3
2 Market Share -2 2 Growth Potential 5
3 Brand Image -2 3 Access to Finance 3
4 Product Life Cycle -4 4 Consolidation 4
5 Customer Service -1 5 Profit 3
6 Customer Loyalty -3
Total -13 18
CP Average -2.2 3.6
Sum of X Averages 1.4
Y Axis
FP (Financial Position) SP (Stability Position)
# Factor Value # Factor Value

1 Earnings Per Share 4 1 Price of Completive Product -3
2 Revenue Increase 4 2 Competitive Pressure -3
3 Return on Assets 3 3 Global Economics -3
4 Leverage 3 4 Technology Change -1
5 Liquidity 3 5 Demand Elasticity -4
6 Cash Flow 3 6 Inflation Rate -3
Total 20 -16
FP Average 3.3 -2.7
Sum of Y Averages 0.6

According to the SPACE Matrix, TomTom falls in the 1st quadrate which best
suits the aggressive strategies such as:
 Product Development.
 Market Development.
 Market Penetration.
 Horizontal Integration (Backward & Forward)

22. Portfolio Analysis: BCG Matrix
Relative Market Share

HIGH LOW
Q2 Stars Q1 Question Mark
Products: Products:
?
 Delivery Solution for Food
Products
HIGH
Strategy:
 Delivery Solutions for Various
Market Growth Rate
Household products

Strategy:
 Market Penetration
Q3 Cash Cow Q4 Dog
Products: Products:
LOW
 E-Commerce concept and

solutions
Strategy: Strategy:
 Diversification.

23. Internal External Matrix:
The IFE Total Weighted Scores (3.07)

4 3 2 1
Strong (3-4) Average (2-2.9) Weak (1-1.9)
High (3-4)
4
I II III
The EFE Total Weighted Scores (2.65)
Medium (2-2.9)
IV
3
Market Development.
Product Development. V VI
Market Penetration.
Vertical Integration.
2
Low (1-1.9)
VII VIII IX
1
The IFE is 3.07 & the EFE is 2.65, so Delivery Hero falls at the (IV) which belongs to the
"grow & build" region and which best suit aggressive strategies such as:
 Market Penetration
 Horizontal Integration

24. Grand Strategy Matrix
Products of Rapid Growth

Markets:
 Delivery Solution for Food Products

 Delivery Solutions for Various
Household products
Suitable Strategies
 Market Penetration – Horizontal
Integration
Weak competitive Strong competitive
Products of Slow Market Growth:
E-Commerce concept and solutions
Suitable Strategies:
 Related Diversification: More features

 Joint Ventures: more strategic
alliance& collaboration.

25. Quantitative Strategic Planning Matrix (QSPM)
Key Internal Factors Weight Rating Weighted Score
Strengths
1) Excellent and friendly Online Platform 0.10 4 0.40
2) Various International Investment 0.07 3 0.21
3) Quick Delivery 0.06 4 0.24
4) Trained Employees 0.05 3 0.15
5) Wide Coverage 0.04 1 0.04

6) Good Customer Support and Trained
0.03 3 0.09
Employees
7) Wider variety of food options 0.06 3 0.18
Weaknesses
1) Orders from nearby restaurants 0.10 2 0.20
2) Tap on the Free Delivery 0.08 2 0.16
3) More areas to cover 0.08 2 0.16
4) Competition with other similar applications. 0.07 1 0.07
5) Costly delivery, slow delivery 0.05 2 0.10

6) In clarity of the occasional food selection
0.12 3 0.36
options.
7) The only available restaurants located in the
0.09 1 0.09
order area have orders.
Total 1 2.45
Opportunities
1) Growing and Expand Markets 0.10 4 0.40

2) Customer Expansion 0.08 4 0.32
3) Increase in Customer Loyalty Programs 0.12 3 0.36
4) Improving the delivery time 0.07 2 0.14

5) Adequate systems to be added to the food
distribution network to ensure that 0.08 2 0.16
Threats
1) Increased Potential 0.12 1 0.12
2) Low Customer 0.10 1 0.10
3) Change in economic condition 0.11 3 0.33
4) Ease of going to the nearby restaurant 0.10 3 0.30
5) Competition by global food chains. 0.12 3 0.36
Total 1 2.59

26. Delivery Hero’s Strategies
Delivery Hero’s current General strategy

 Converting the current food delivery market from offline to online.
 Aiming to increase the total market size by convincing customers how convenient it is
to get food delivered to their doorstep.
 Build a unique product and an outstanding experience that creates truly joyful
moments to accelerate the change of customers’ behavior from cooking to ordering.
 Achieve the most enjoyable way while contributing to people’s happiness.
 Being number one in all of Delivery Hero markets.
Delivery Hero IPO and the consolidation strategy

 Achieving the tremendous growth and vast international presence mainly through
acquisitions.
 The acquisition spree created in the process liquidity events for several local food
delivery founders, including e-food.gr in which I was a co-founder and thus had a first-
hand experience.
 The strategy, that has been often criticized, for the seemingly high prices paid for
smaller companies’ acquisitions has proven successful and offers valuable inferences
for tech startups.
 In marketplaces with strong network effects the leader has a significant advantage.
Delivery Hero Marketing Strategy

 Using Emotive Marketing to Get a Bigger Slice of the Food Delivery Market.
 Offering mobile app and online for customers’ orders.
 Aligning marketing and messaging with the needs, characteristics and cultures of its
customers.
 Help customers at a faster service pace than most of its competitors.
Delivery Hero Strategy of adapting campaigns to cultures “satisfy its customers”

 Acquiring a new customer can be 5x the cost of retaining an existing customer.
 Building capabilities to “become the brand that resonates with customers, and
therefore keeps them coming back.
 Make each customer feel “special” providing gifts and discounts
 Taps local teams and knowledge to match campaigns with the popular culture.
Delivery Hero Digital Strategy

 Offering choice for customers to discover and order food online.
 Create a massive online app that commands a high degree of loyalty and which forms
the foundation of its services model.

 Offering advance NextGen technology like Machine learning, Robot, Drone and
autonomous driverless cars for delivery.
27. Delivery Hero’s Managing Change and Innovation
External Changes:
 Changing consumers’ needs and wants by offering choice, convenience, reliability,
and quality.
 Changing technology by offering choice for the customer to order food online and
using Advance NextGen technology like Machine learning, Robot, Drone and
autonomous driverless cars for delivery.
 Economic changes by making a significant direct contribution to the global economy
in express delivery industry by offering hundreds thousands jobs and enabling
companies and restaurants to maximize the efficiency of their operations – reducing
production shutdowns and allowing the implementation of best international
techniques such as build-to-order.
Internal Changes:
 New Organizational strategy by implementing the following strategies:
 Converting the current food delivery market from offline to online.
 IPO and the consolidation strategy
 Digital Strategy.
 Adapting campaigns to cultures “satisfy its customers”
 Change in composition of workforce by implementing role mapping, training and
contract.
 Supporting staff during a change process and in transitioning to new forms of work
and responsibilities.
 Changing employees’ attitudes by applying intrinsic motivation, enhancing them in a
business setting, managers' attitudes encourage employee high performance, so it
helps them deliver more, Allow employees to participate in the change process.

28. Financial Performance
Orders nearly double year-on-year (YoY) to 239 million, with more than 3 million orders
delivered in a single day Q1 GMV up 58% at EUR 2.4 billion and Q1 revenue up 92% at
EUR 515 million. Delivery Hero implements global measures to support governments and
delivery ecosystems during the COVID-19 pandemic. Financial outlook for the group
unchanged despite costs associated with COVID-19 Delivery Hero pioneers quick
commerce (q-commerce) category with ultra-fast deliveries from affiliated stores and
more than 100 Dmarts (cloud stores) across nine markets. Closing of strategic
partnership with Woowa expected in H2 2020
Berlin, April 28, 2020 – Delivery Hero, the world’s leading local delivery platform,
continued its strong growth trajectory in the first quarter of 2020 as improved service,
selection and shortened delivery times boosted orders of food and grocery products
across the globe.
Despite a 9 million negative effect on orders after mid-March driven by COVID-19, Q1
orders almost doubled (+92%) to 239 million, up from 125 million a year ago,
outperforming growth expectations for the twelfth consecutive quarter. In the first quarter,
the company added 23 million incremental orders, with more than 3 million orders being
delivered in a single day.
Q1 2020’s Gross Merchandise Value (GMV) increased by 58% YoY on a constant
currency basis to EUR 2.4 billion, and revenues grew by 92% YoY on a constant currency
basis to EUR 515 million. Delivery Hero’s continued strong performance was driven by
significant increase in new restaurants and fast expansion into grocery delivery. The initial
negative effect from COVID-19 was swiftly managed and over 50,000 restaurants and
1,500 grocery stores and other local businesses were added in the last 3 weeks of March.
As a result, Delivery Hero has seen a quick recovery and a substantial expansion of new
customers, an increase of 10% since the beginning of March 2020.
Niklas Östberg, CEO of Delivery Hero, said:
We had a strong start to the year with an impressive growth in order volumes and
increased customer acquisition. The instant response to the challenges from the COVID-

19 pandemic has led to quick recovery and acceleration of our service offering,
responding to changing customer behavior and larger demand for online delivery. We
continue to pioneer new and innovative solutions to meet this need. We are particularly
proud of pioneering the quick commerce category with delivery of grocery and other items
in less than 20 minutes.
Delivery Hero's Financial Analysis for the period from 01.01.2017 to 31.12.2020
1. Financial Position Analysis

The following report analyses the financial condition based on the financial statements
data prepared according to International Financial Reporting Standards (IFRS) for the
period 01.01.2017–31.12.2020.
1.1. Structure of the Assets and Liabilities

Value Change for the
period
analyzed
in 000 EUR % of the balance

total
31.12.20 31.12.20 31.12.20 31.12.20 at the at the end

Indicator
16 17 – 19 20 beginning of the
in 000 ±%
31.12.20 of the period
EUR
18 period analyzed
(average analyzed (31.12.20
d) (31.12.20 20)
16)
Assets
Current
+176,06 +44.
assets, 396,337 362,129 566,317 572,397 33.1 24
0 4
total

Receivable +121
60,550 108,387 123,618 134,274 5.1 5.6 +73,724
s .8
Cash, cash
equivalents
, and short- +27.
323,619 241,512 425,184 413,358 27 17.3 +89,739
term 7
investment
s
Noncurrent 1,442,61 1,808,66 1,816,52 +1,015,3 +126

801,170 66.9 76
assets 0 1 2 52 .7
Liabilities and Equity
Current +245,69 +3.2

110,490 198,858 249,363 356,182 9.2 14.9
liabilities 2 times
Noncurrent +501,04 +5.4

114,898 325,803 632,045 615,940 9.6 25.8
liabilities 2 times
Stockholde 1,280,07 1,493,57 1,416,79 +444,67 +45.

972,119 81.2 59.3
rs' equity 8 0 7 8 7
Other
capital
(temporary
equity,
– – – – – – -972,119 -100
commitme
nts and
contingenci
es)
Assets;
1,197,50 1,804,73 2,374,97 2,388,91 +1,191,4 +99.
Liabilities 100 100
7 9 8 9 12 5
and Equity

On 31 December, 2020, about three quarters of all the company's assets were related to
the noncurrent assets (76%), while a quarter consisted of current assets (24%) During
the 4 years, it was seen that there was swift growth in the assets of EUR 1,191,412
thousand, or of 99% (to EUR 2,388,919 thousand). The company's assets grew in parallel
with equity (+45.7% during the period analysed (from 31 December, 2016 to 31
December, 2020)). Growth of the equity value is a factor which positively describes the
dynamics of Delivery Hero's financial state.
The increase in total assets of Delivery Hero occurred due to the growth of the following
asset types (amount of change and percentage of this change relative to the total assets
growth are shown below):
Goodwill – EUR 571,513 thousand (47.5%)
Property, plant and equipment, net – EUR 169,591 thousand (14.1%)
Intangible assets, net (excluding goodwill) – EUR 141,208 thousand (11.7%)
Cash, cash equivalents, and short-term investments – EUR 89,739 thousand (7.5%)
The most significant growth of sources of finance ("Equity and Liabilities") is seen on the
following rates (the percentage from total equity and liabilities change is shown in
brackets):
Long-term debt and lease obligations – EUR 597,519 thousand (45.7%)
Additional paid in capital – EUR 437,404 thousand (33.5%)
Accrued liabilities, current – EUR 137,930 thousand (10.6%)
Other liabilities, current – EUR 76,350 thousand (5.8%)
The most significantly changed items on the balance sheet during the 4 years are
"Prepaid expense, current" in assets and "Deferred income tax liabilities, noncurrent" in
sources of finance (EUR -12,168 thousand and EUR -108,022 thousand, respectively).

During the period reviewed, the current receivables rapidly spiked (EUR +73,724
thousand).
1.2. Net Assets (Net Worth)
Value Change
in thousand EUR % of the balance total thousan %,
at the at the end 31.12.20 31.12.20 31.12.20 31.12.20 d EUR ((col.

beginning of the 16 17 – 19 20 (col.3- 3 -
Indicator of the period 31.12.20 col.2), col.2
period analysed 18 ) :
analysed (31.12.202 (average col.2
(31.12.201 0) d) )
6)
1 2 3 4 5 6 7 8 9
1. Net -
tangible 222,034 -46,009 18.5 -2.6 -0.6 -1.9 268,04 ↓
assets 3
2. Net +444,6 +45.

972,119 1,416,797 81.2 71.1 62.9 59.3
assets 78 7

(Net
worth)
3. Stock
9 9 <0.1 <0.1 <0.1 <0.1 – –
capital
4.
Differen
ce
between
net
+444,6 +45.
assets 972,110 1,416,788 81.2 71.1 62.9 59.3
78 7
and
stock
capital
(line 2 -
line 3)
During the period analyzed, the net tangible assets significantly reduced by EUR 268,043
thousand and equaled EUR -46,009 thousand. The intangible assets were equal to EUR
1,462,806 thousand on 31.12.2020. This value shows the difference between the value
of net tangible assets and all net worth.
The net worth (net assets) of Delivery Hero was much higher (by 157,421.9 times) than
the stock capital on 31 December, 2020. It positively describes the company's financial
state. The net worth (net assets) value is used as one of the tools to estimate the
company's value (used together with other methods, such as discounted cash flow
method, or an estimation based on shareholder's value etc.). But it is a key value in the
estimation of the company's financial condition.

The debt-to-equity ratio and debt ratio are the main coefficients describing financial
stability. The ratios are similar in their meaning and indicate a relationship between two
main sources of capital: equity and borrowed capital. The difference between the ratios
is that the first one is calculated as a relationship of the borrowed capital (liabilities) to
equity, while the second ratio is calculated as a relationship of the liabilities to the overall
capital (i.e. the sum of equity and liabilities).
On 31.12.2020, the debt-to-equity amounted to 0.69. The debt ratio amounted to 0.41 on
31 December, 2020. The debt ratio fast climbed (+0.22) during the period reviewed.
The debt-to-equity ratio and debt ratio for Delivery Hero demonstrate optimal values at
the end of the period analysed. It is as a result that percentage of the liabilities is 40.7%,
while the percentage of equity is 59.3%. It is recommended to keep the percentage of
liabilities at a level which will not exceed 60%. The values of the debt ratio corresponded
to acceptable ones during the whole reviewed period.
The structure of the company's capital is shown in the chart below:

According to well-known principles for stable company development, investments with

the least liquid assets (noncurrent assets) should first be made with help from the most
long-term sources of financing, i.e. with the help of own capital (equity). An indicator of
this rule is the noncurrent assets to net worth ratio. On the last day of the period analyzed
(31.12.2020), the ratio amounted to 1.28. The ratio significantly spiked (by 0.46) during
the period reviewed (from 31 December, 2016 to 31 December, 2020). On 31.12.2020,
the value of the ratio is not a satisfactory one.
The current liability ratio shows that the share of short-term and long-term liabilities of
total liabilities of the company were 36.6% and 63.4% respectively on 31 December,
2020.
The dynamics of the main ratios of financial stability of Delivery Hero is shown in the
following chart.

1.3.2. Working capital analysis

Change for the
Value
period analyzed
%
Indicator 31.12.2017 –
(col.5- ((col.5-
31.12.2016 31.12.2018 31.12.2019 31.12.2020
col.2) col.2) :
(averaged)
col.2)
1 2 3 4 5 6 7
1. Working
capital (net
+285,847 +163,271 +316,954 +216,215 -69,632 -24.4
working capital),
thousand EUR
2. Inventory,
– – – – – –
thousand EUR
3. Working
capital
sufficiency (1- +285,847 +163,271 +316,954 +216,215 -69,632 -24.4
2), thousand
EUR
4. Inventory to
– – – – – x
working capital

ratio (2:1)
Normal value: 1
or less.
The working capital was EUR 216,215 thousand on 31 December, 2020. The working
capital reduced notably (by EUR 69,632 thousand, or by 24.4%) for the 4 years. According
to calculations, working capital fully covers the inventory of the company and is deemed
to be a positive factor. At the end of the period reviewed, the inventory to working capital
ratio was equal to zero. Such a correlation is deemed to be normal, although it can be
achieved through warehouse inventory that is too low, but not through enough of long-
term resources of financing in some cases.
2. Financial Performance
2.1. Overview of the Financial Results
The table below tells us about the main financial results of Delivery Hero's activities during
the entire period analyzed.

Value, thousand EUR Change Average

annual
Indicator thousand value,
2017 2018 2019 2020 ±%
EUR thousand
EUR
1 2 3 4 5 6 7 8
1. Revenues 683,067 1,007,257 1,312,151 1,819,982 +1,136,915 +166.4 1,205,614
2. Cost of
54,839 82,301 113,800 122,847 +68,008 +124 93,447
revenue
3. Gross
628,228 924,956 1,198,351 1,697,135 +1,068,907 +170.1 1,112,168
profit (1-2)
4. Other income
and expenses
from continuing
operations,
except interest -536,480 -836,023 -1,223,227 -1,844,393 -1,307,913 ↓ -1,110,031
and debt
expense and
income tax
expense
5. EBIT (3+4) 91,748 88,933 -24,876 -147,258 -239,006 ↓ 2,137
6. Interest and
2,100 7,500 1,900 29,700 +27,600 +14.1 times 10,300
debt expense
7. Income tax
expense -9,335 2,952 -8,210 -21,097 -11,762 ↓ -8,923
(benefit)

8. Income
(Loss) from
Continuing 98,983 78,481 -18,566 -155,861 -254,844 ↓ 759
Operations (5-
6-7)
9. Income (loss)
from
discontinued
– – – – – – –
operations and
extraordinary
item
10. Net income

98,983 78,481 -18,566 -155,861 -254,844 ↓ 759
(loss) (8+9)
11.
Comprehensive
income (loss), 99,833 77,818 -18,303 -155,508 -255,341 ↓ 960
attributable to
parent
The revenue equaled EUR 1,819,982 thousand during the last year. For the entire period
reviewed, the revenue was verified to spike quickly by 166.4%. Growth in the revenue
was observed during the whole of the period. The change in revenue is demonstrated on
the chart. During the last year, the gross profit amounted to EUR 1,697,135 thousand.
The gross profit went up by 170.1% for the period reviewed (from 31 December, 2016 to
31 December, 2020).
Despite a good gross profit, the company posted a loss before interest and taxes (EBIT)
to the amount of EUR 147,258 thousand for the last year. The final financial result was a
net loss for Delivery Hero of EUR 155,861 thousand during the year 2020.

2.2. Profitability Ratios

Value in % Change
Profitability ratios (col.5 -
2017 2018 2019 2020
col.2)
1 2 3 4 5 6
1. Gross margin. 92 91.8 91.3 93.3 +1.3
2. Return on sales (operating margin). 13.4 8.8 -1.9 -8.1 -21.5
3. Profit margin. 14.5 7.8 -1.4 -8.6 -23.1
Reference:
Interest coverage ratio (ICR). Normal value: 1.5 43.7 11.9 -13.1 -5 -48.6
or more.
The profitability calculated by earnings before interest and taxes (Return on sales) is more
important from a comparative analyses point of view. During the whole of the analysed
period the return on sales (ROS) was continuously decreasing. For the last year, the

return on sales was -0.08 (or -8.1% per annum), and profitability calculated by net profit
was -8.6% per annum.
To assess the liabilities that the company should repay for the use of borrowed capital,
an interest coverage ratio was calculated. The acceptable value is deemed to be not less
than 1.5. In this case, the interest coverage ratio was -5 for the last year, which makes it
doubtful as to whether Delivery Hero is capable of paying interest on the borrowed assets.
It should take into account that not all interest payments are necessarily included on the
income statement. In certain cases interest is included in investments in noncurrent
assets and as a result it is not used to calculate the indicated ratio.
The chart below shows changes of the main rates of return on assets and equity of the
company during the period reviewed.


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Strategic Audit Report

Delivery Hero / Talabat

Ahmed Hashem Abd El-Moaty

Dr. Khaled Bekhit

Submitted to – Dr. Khaled Bekhit Page 1 of 54

Submitted to – Dr. Khaled Bekhit Page 2 of 54

“Always Delivering an Amazing Experience – Fast, easy and to your door”

Deliver Hero vision aspires to create an amazing takeaway experience, by offering:

Submitted to – Dr. Khaled Bekhit Page 3 of 54

According to the mission statement criteria, Delivery Hero’s mission statements,

Submitted to – Dr. Khaled Bekhit Page 4 of 54

5. Product & Service

6. Business and Local Partners

The Delivery Hero brand contains multiple international brands.

7. How local partners (Talabat) do business?

Submitted to – Dr. Khaled Bekhit Page 5 of 54

8. The Company Goals

Submitted to – Dr. Khaled Bekhit Page 6 of 54

Submitted to – Dr. Khaled Bekhit Page 7 of 54

Submitted to – Dr. Khaled Bekhit Page 8 of 54

11. Delivery Hero’s Competitors Profile

Submitted to – Dr. Khaled Bekhit Page 9 of 54

COVID 19 PANDAMIC EFFECT

COVID-19: ADAPTING TO THE NEW REALITY WHILE KEEPING EVERYONE SAFE

UNCHANGED GROUP OUTLOOK

Submitted to – Dr. Khaled Bekhit Page 10 of 54

12. SWOT Analysis

Submitted to – Dr. Khaled Bekhit Page 11 of 54

 Easy to browse and user-friendly wide

Submitted to – Dr. Khaled Bekhit Page 12 of 54

 Emerging markets in world. Example, Deliveroo was founded in 2013 and is

UberEats was launched by Uber as a pilot

Health Issues – Increasing obesity rates

Submitted to – Dr. Khaled Bekhit Page 13 of 54

13. Internal Factors Evaluation (IFE)

Key Internal Factors Weight Rating Weighted Score

1) Excellent and friendly Online Platform 0.10 4 0.40

2) Various International Investment 0.07 3 0.21

3) Quick Delivery 0.06 4 0.24

4) Trained Employees 0.05 3 0.15

5) Wide Coverage 0.04 1 0.04

1) Orders from nearby restaurants 0.10 2 0.20

2) Tap on the Free Delivery 0.08 2 0.16

3) More areas to cover 0.08 2 0.16

4) Competition with other similar applications. 0.07 1 0.07

5) Costly delivery, slow delivery 0.05 2 0.10

Submitted to – Dr. Khaled Bekhit Page 14 of 54

14. VALUE CHAIN ANALYSIS

a) Inbound Logistics & Procurement:

Submitted to – Dr. Khaled Bekhit Page 15 of 54

 Delivery Hero – Quick Commerce – Against the backdrop of a significant change in

Submitted to – Dr. Khaled Bekhit Page 16 of 54

Submitted to – Dr. Khaled Bekhit Page 17 of 54

II. Support value Activities:

Submitted to – Dr. Khaled Bekhit Page 18 of 54

How Delivery Hero Manage Their Global Employee Engagement Strategy

Submitted to – Dr. Khaled Bekhit Page 19 of 54

Giving managers the insight to address regional priorities