[HN Gopher] Third-party food delivery remains an uncertain business
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Third-party food delivery remains an uncertain business
Author : XnoiVeX
Score : 13 points
Date : 2021-03-08 21:52 UTC (1 hours ago)
(HTM) web link (www.restaurantbusinessonline.com)
(TXT) w3m dump (www.restaurantbusinessonline.com)
| paxys wrote:
| - Restaurants have to pay a big chunk of their margin to delivery
| apps.
|
| - Consumers see increased food prices and other misc charges,
| greatly inflating their bill (sometimes up to 2x).
|
| - Drivers get no benefits, have to pay for
| fuel/depreciation/taxes, and sometimes end up making less than
| minimum wage.
|
| - Uber Eats, Grubhub, Doordash etc. all lose billions of dollars
| every quarter (and are still valued in the tens to hundreds of
| billions).
|
| I genuinely do not understand this industry.
| tomdell wrote:
| Just another instance of VCs pumping money into a bad but
| appealing idea and propping it up indefinitely at the expense
| of society at large. This kind of investment really needs to be
| more closely regulated - the businesses never even have to be
| successful for the investors to profit as long as they go
| public in time to leave retail investors holding the bag before
| the crash.
| acchow wrote:
| > "In 60 years," CFO Stuart Levy said on Thursday, "we've never
| made a dollar delivering a pizza. We make money on the product,
| but we don't make money on the delivery."
|
| Domino's charges a $5.99 delivery fee whereas UberEats is
| charging me a $4.05 service fee plus a $3.49 delivery fee plus $2
| CA Driver Benefits bringing its total fees to $9.54.
| kevindong wrote:
| The delivery models are fundamentally different. Domino's (and
| restaurants like it that have historically had in-house
| delivery drivers) is always single source, multi-destination.
|
| Uber, Grubhub, DoorDash et. al. are multi-source, multi-
| destination.
| ev1 wrote:
| Don't forget that Uber is also charging the restaurants nearly
| the same amount.
| bobitsaboy wrote:
| Unless it's completely dead, every pizza shop runs multiple
| orders at once and their drivers are in and out swiftly. The
| food stays fairly hot thanks to commercial heat bags.
|
| For the delivery apps, the driver has to possibly wait in a
| line, check it out, then deliver the order a single order at a
| time.
| TylerE wrote:
| Many of the apps will actually batch multiple orders from the
| same restaurant to multiple near(ish) dropoffs.
| khuey wrote:
| Domino's runs a business designed around delivery with a
| delivery-friendly product and runs delivery in-house. UberEats
| does none of that.
| ev1 wrote:
| On the other hand, every time I've ordered papajohns I get a
| doordash driver, interestingly.
| sharemywin wrote:
| Here's the thing. Most food doesn't deliver well. So what
| delivers well? Pizza, Wings, Subs. and some Chinese food. Who
| already has their own delivery drivers usually. And when they do
| they run 3 and 4 deliveries at a time. way more efficient.
|
| Right now the dynamic has a lot of power towards the delivery
| services. So, restaurants will subsidize some of the delivery
| cost to sell the food. But in a few months a lot of the
| restaurants are going to be crowded as F. because there are less
| restaurants to compete with. So, most deliveries are going to
| cost $7 plus tip or more. and it won't be as good as right from
| the restaurant.
|
| And I see some of the service really pushing their own shadow
| stores because they can make profit off that.
| [deleted]
| hertzrat wrote:
| I get 40% or 70% off coupons every week or so from one delivery
| app or another (today's was 40% off, last week was 75% iirc with
| a different company). How do you compete with businesses willing
| to lose so much money to shut down their competition? A lot of
| large or well funded companies practice this but does it really
| lead to a healthy market?
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(page generated 2021-03-08 23:00 UTC)