Actually I think this business model works better in big and dense Asian cities. There are a few things going for them:
1. cheaper labor: that drives down delivery costs
2. low credit card penetration is a business advantage: the drivers (or bicycle riders :), can collect COD. That saves card transaction fee too ...
3. buying habit: I know for certain that many Asians still shop groceries daily. This, together with a very busy, growing, new middle class, provides for a big and fast growing market
Not sure if the market is big enough, but there could also be an opportunity for servicing foreigners in those countries fearful of being quoted a 'tourist price'. e.g., you're in Xian and are going hiking at Huashan the next day. You'd like to have a package of supplies (drinks, snacks, packed lunch) delivered in the evening so you're ready to go in the morning. Some of things would be trivial to organise with a walk around the block, but others might be difficult because of the potential language barrier.
