Amazon to venture into food delivery space with Prime Now

Amazon is planning to use Prime Now, its two-hour delivery platform, for its foray into the food delivery business in India. By adding a food delivery segment to its Prime offering, the firm will not only bring in more daily users but also boost the number of transactions.

Amazon has also held preliminary discussions with Foodpanda, Ola's food delivery unit, for a partnership that could be later extended to an acquisition. The company has further approached Uber Eats for the same.

Prime Now is expected to be used as a platform concentrating on high-frequency use cases of food and grocery delivery.

A source aware of the development said, “Amazon has spent some time debating whether to build food delivery from scratch or go for partnership and investments. They seem to have opted for the latter. They have held talks with both Uber and Ola for it. Prime Now cannot be sustained just on the grocery delivery as the logistics team has questioned inefficient utilisation of delivery fleet for the express delivery platform.”