Delivery vs Ridesharing: Which is Sustainable for Drivers?

Delivery vs Ridesharing Which is Sustainable for Drivers?

Globally ridesharing and delivery services have become so popular that new employment opportunities are being created every day around these sectors, accelerating the growth of these two sectors. In Bangladesh, both sectors have experienced similar growth, and many are considering ridesharing and delivery services as their full-time careers. Until September 29, 2021, 14 ridesharing platforms in Bangladesh had 25,229 registered vehicles. In addition to ridesharing platforms like Uber, Pathao, and Obhai, delivery platforms like Paperfly, Redex, Daraz Express, foodpanda, and several other delivery service providers are creating jobs for many people. However, how sustainable are these sectors as a person’s full-time career?

Up until September 29, 2021, there have been 14 ridesharing platforms in Bangladesh with 25,229 registered vehicles.
Apart from ridesharing platforms like Uber, Pathao, and Obhai, there are several delivery platforms too like Paperfly, Redex, Daraz Express, and Foodpanda.

Overview

With the global ridesharing industry and the delivery services sector booming, many are now choosing these two sectors as their source of income. Besides working in these sectors part-time as a side gig, many consider these sectors as full-time careers. According to Statista, the global market size of ridesharing services in 2021 was $117.34 billion. 

In 2016, when ridesharing service first started in Bangladesh, a similar growth scenario was witnessed in the country, and thousands of people are now involved in the ridesharing industry. According to the Policy Research Institute, as of February 2020, the value of the ridesharing industry in Bangladesh is BDT 2,200 crore which is 23 percent of Bangladesh’s total transportation sector. According to a report in The Daily Star, Bangladesh’s ridesharing industry will reach USD 1 billion by 2025.

It is reported by The Daily Star that the ridesharing industry in Bangladesh will reach USD 1 billion by 2025.

On the other hand, keeping up with the global trend in delivery services, college, and university-going students, besides many other people of Bangladesh, are now building their careers in food delivery or parcel/package delivery. Freedom in the workplace and adequate opportunities are key reasons behind such growth in this field. eCommerce and fCommerce like Daraz, Chaldal, and Rokmari grew in Bangladesh. As a result, the demand for delivery services is also constantly increasing. According to the e-Commerce Association of Bangladesh (e-CAB), the market size of the e-commerce industry in Bangladesh is expected to reach 3 billion by 2023.

According to Statista, the global market size for the ridesharing industry was $75.39 billion in 2020 and $117.34 billion in 2021.

At present, Bangladesh has about 2,000 e-commerce sites and 50,000 Facebook-based businesses, from which about 30,000 products/parcels are delivered daily, of which 80% are online sales in Dhaka, Chittagong, and Gazipur. As a result, a large number of deliverymen are required. Taking advantage of this demand, many are focusing on providing delivery services. Besides, the food delivery sector of Bangladesh is also growing steadily. Many students work as deliverymen on food delivery platforms like Foodpanda, Pathao food, Sohoz food, and Hungry Naki. However, the question remains: which of these two sectors is sustainable as a career?

Among all the e-commerce and Facebook-based businesses in Bangladesh, 30,000 parcels are delivered daily.

Which is Sustainable?

Ridesharing

If someone has a car or a motorcycle, ridesharing can be an opportunity. In fact, many have bought new motorbikes and cars to earn money through ridesharing. According to a BRTA source, the total number of motorbikes registered in Bangladesh till February 2022 is 35,85,488. However, there are some advantages and disadvantages to earning through ridesharing.

The most significant advantage of ridesharing is that it requires no paperwork. To register on any ridesharing platform, one can register online on any ridesharing platform. Also, as ridesharing has become popular in Bangladesh, drivers do not have to wait long to get a ride. Drivers also have their freedom when it comes to ridesharing. The driver can pick up a rider from any place they want. Besides starting and finishing work at their convenience, drivers have the freedom of not working any given day if they wish. In this case, ridesharing can be compared to a sole proprietorship business. Because here, the driver works at his convenience and benefits from ride selection freedom. In addition, riders enjoy various facilities after meeting the target set by the ridesharing platform they are registered in. 

In Bangladesh, the base fare for rideshare on a motorbike is between BDT 25 to 30,and in terms of a car, it is between BDT 50 to 60. On the other hand, the base fare on Pathao for a motorbike ride is BDT 25. However, actual fares vary based on traffic jams, rush hours, and emergencies. According to the Dhaka Tribune, in Dhaka, a driver can earn between BDT 500 and 2,000 per day depending on the area and distance of the ride, which is about BDT 15,000 to 60,000 per month.

In Bangladesh, the base fare for a motorbike is between BDT 25 to 30 and for a car, it is between BDT 50 to 80.

However, there are also some disadvantages of riding sharing in addition to these advantages. Of which the main issue is the safety of the driver. Although the rider details are available through the Ridesharing app, the driver cannot immediately take action if the rider wants to harm the driver. In recent times, such incidents have been widespread around the world. Besides, many drivers in Bangladesh share rides without any app to avoid the commission imposed on the platforms. Thus, it becomes tough for the driver to ensure his safety in this case. In addition, drivers need to ensure vehicle maintenance and cleanliness, good behavior of the rider, and smooth ride experience, because riders give performance-based ratings to drivers based on these factors.

Moreover, riding sharing requires driving for a long time, making the driver physically exhausted. Also, ridesharing with the same car or motorbike for long periods means that the vehicle has to go through frequent servicing, which is also expensive. However, the most significant disadvantages of ridesharing are mainly strikes, platforms being shut down during lockdowns, and fewer rides on rainy days.

Delivery

Delivery services are usually conducted by college and university students. Besides motorbikes or bicycles, delivery services can even be provided on foot. Besides, presently e-commerce and f-commerce are growing in Bangladesh. Therefore, employment opportunities for unemployed youth are being created.

One of the significant advantages of delivery service is that here instead of a passenger the delivery person has to carry a parcel and delivery it to different locations. Because carrying a package is much easier and hassle-free than traveling with a stranger. In this case, the delivery man has to pick up a package from one location and deliver the package to another location, requiring less human interaction. 

In addition, in the case of delivery, the driver can select the route of his choice and also has the freedom to choose his preferred vehicle. Moreover, they can also choose their preferred delivery area. In the case of delivery, a deliveryman can work for an organization in exchange for a fixed salary, which ensures fixed working hours and the job. For example, a Daraz delivery driver always delivers Daraz products. Besides package delivery, deliverymen can also work for food delivery. 

In Bangladesh, platforms like Foodpanda, Paperfly, and Pathao Courier offer opportunities to earn by working full-time, part-time, or freelancing by delivering various packages and food. According to a report, Foodpanda deliverymen earn an average of bdt 38 per delivery, but if the distance increases, so does the payment. Freelancer deliverymen in Bangladesh can earn from BDT 20 to BDT 75 per delivery. According to the sources of The Daily Star, a college student in Dhaka makes between BDT 300 to BDT 350 by delivering for just 3 hours a day. In addition, food delivery apps usually allow the delivery force to work in different shifts. As a result, food delivery is a convenient option for students and part-time work.

Freelancer deliverymen in Bangladesh can earn from BDT 20 to BDT 75 per delivery.

On the other hand, a contracted deliveryman working in Pathao Courier gets a BDT 5,000 per month. The deliveryman completes about 30 deliveries a day and earns an extra BDT 15 for each delivery. According to Salary Explorer, in 2022, a courier, delivery, and transportation driver in Bangladesh gets an average salary of BDT 10,200 per month.

In addition to all these advantages, the delivery man has to face many difficulties. The income in delivery service is a little lower than riding sharing. In addition, sometimes the person receiving the package may not be present during delivery, so the package has to be returned, which is an extra hassle for the deliveryman. Also, there is uncertainty regarding the adequate amount of delivery every day. Moreover, in the case of food delivery, the deliveryman has to wait outside the restaurant for a long time. The deliverymen have to face customers’ rude behavior for the slightest delay. A freelance deliveryman’s salary is not fixed. Furthermore, there is no guarantee the deliveryman will receive enough money every day.

Considering the advantages and disadvantages of ridesharing and delivery services, it is clear that the risk in ridesharing is higher, so is the income. On the other hand, as the income in delivery is less, so is the risk. However, in terms of sustainability, ridesharing is less sustainable. Because there is no fixed salary in this sector, if the driver cannot share any ride on any given day, there is no income on those days. 

On the other hand, the delivery service has a fixed salary on different platforms. As a result, even if the delivery man can’t work a day, they will still receive the fixed compensation at the end of the month. Moreover, besides the fixed salary, deliverymen receive various other benefits from the organization that the freelancer deliverymen or the ridesharing drivers do not receive from their organizations. In addition, delivery service is much safer and more flexible. As a result, even having a lesser income than ridesharing, providing delivery services is more sustainable as an income source.

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