The food delivery market in the United Arab Emirates is yet to reach its saturation point, with room for further growth. In recent years, the UAE has witnessed a considerable shift in consumer behavior, driven by technological advancements and changing lifestyles, in addition to the big role COVID-19 played in consumer preferences. This transformation has pushed the food and e- commerce delivery sector into the spotlight, with an unprecedented surge in demand for convenient and efficient delivery services. By 2025,
was forecast to reach around 274 million U.S. dollars, almost quadrupling since 2020.
What is driving food delivery growth in the UAE?
The UAE's food and e-commerce delivery sector has experienced exponential growth, driven by a burgeoning population thanks to increasing urbanization across the Emirates, high adoption of smartphone users, and a growing appetite for convenience. The
penetration rate in the online food delivery market was forecast to continuously increase, reaching around half the users in the UAE. The UAE is predicted to grow further pushed by increasing digitalization in the country, and favorable government initiatives that boost the adoption of online food delivery among consumers.
By 2026, the
average revenue per user in the online food delivery market in the Emirates was forecast to almost double its value in 2019.
Market players and challenges
The UAE’s leading food delivery app is delivery aggregator Talabat – a Kuwaiti company currently acquired by Delivery Hero. The latest data shows that
Talabat’s market share in the UAE significantly exceeds that of its competitors. Talabat’s market competitors include Deliveroo and Careem. While the prospects for the food delivery sector in the UAE show promise, businesses still face many challenges, particularly concerning delivery costs and operational efficiency. Fluctuating fuel prices, laborur expenses, and infrastructure investments all put pressure on delivery service providers. These providers are presented with the challenge of optimizing costs without compromising service quality. However, with the UAE government's continued focus on digital transformation and infrastructure development, there is still a positive outlook for the food delivery business.
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