How do food businesses negotiate with online food portals?


It would very much depend on the food you are trying to sell, consumer segments that the portal targets, current reach and the marketing strategy of the portal and finally if you are taking the delivery responsibility or the portal.

Popular portals/marketplaces such as amazon have standards terms for their merchants including the fixed fee, revenue share component, service level among other elements. Niche food portals might ask for greater revenue shares as their target market size and volume of transaction would be lower. Niche portals could offer you a greater scope for discussion/negotiation.

The first step is to get the choice of the portal right. If you have a differentiated product targeted at a local market (due to the nature of the product and/or the preference for it) you should consider going for niche portal else i would suggest for international portals. It is critical to get this partnership aligned with your overall value proposition.

Once you have got the portal choice right you need to understand the value your product/s bring to the portal (how does your product/s contribute to the popularity/traffic for the portal) and how effective the portal is in getting you the orders and most importantly adds value to your brand/business image.

A fair evaluation of these factors and an open discussion with the players could help you get a feasible and mutually beneficial working relationship.