[HN Gopher] DoorDash and Pizza Arbitrage (2020)
___________________________________________________________________
DoorDash and Pizza Arbitrage (2020)
Author : thunderbong
Score : 180 points
Date : 2024-06-27 01:16 UTC (21 hours ago)
(HTM) web link (www.readmargins.com)
(TXT) w3m dump (www.readmargins.com)
| NaOH wrote:
| Previous discussion:
|
| _Doordash and Pizza Arbitrage_ -
| https://news.ycombinator.com/item?id=23216852 - May 2020 (518
| comments)
| chrismorgan wrote:
| Also https://news.ycombinator.com/item?id=32086170 (July 2022,
| 230 comments)
| lizknope wrote:
| It was posted yesterday to reddit on "Today I Learned" and got
| over 59,000 upvotes. I knew I had seen it here before and now
| I'm seeing it here for the third time.
| osamagirl69 wrote:
| There is one update the the article that seems noteworthy:
|
| >Note 1: We found out afterward that was all the result of a
| "demand test" by
|
| >Doordash. They have a test period where they scrape the
| restaurant's website
|
| >and don't charge any fees to anyone, so they can ideally go to
| the restaurant
|
| >with positive order data to then get the restaurant signed
| onto the platform.
|
| >If we had to pay a customer fee on the order, it would've
| further cut into our
|
| >arbitrage profits (though maybe we could've incorporated
| DashPass as part of
|
| >the calculation).
| princevegeta89 wrote:
| This article is more than four years old
| teractiveodular wrote:
| (2020)
| m463 wrote:
| makes me think of webvan and peapod.
| robbyiq999 wrote:
| Would this be wire fraud?
| Terr_ wrote:
| If you mean by the pizzeria, I don't see a problem.
|
| If you mean DoorDash, I suspect it depends on whether there's
| something in their presentation that fraudulently impersonates
| the pizzeria.
| randomcarbloke wrote:
| maybe but it didn't happen so it's okay.
|
| That isn't to say it isn't 100% possible, it is.
| KeplerBoy wrote:
| If you leave out the toppings it's definitely fraud.
|
| Doordash doesn't get the pizza they paid for and want to
| resell.
| JumpCrisscross wrote:
| > _Doordash doesn 't get the pizza they paid for and want to
| resell_
|
| Given the restaurant was receiving calls from customers,
| would it be okay if a customer who ordered from DoorDash
| called to change their order? If so, we can add an imaginary
| step where the person who "ordered" these pizzas had them
| changed to just dough without demanding a price change.
| KeplerBoy wrote:
| Wouldn't work in the scenario described in the text.
|
| As far as the restaurant is concerned the order was made by
| the dasher and can't be changed by seemingly random people
| who happen to call.
| b3lvedere wrote:
| The driver argued the amount of time it would take to come back
| to return the bag would mean he couldn't make enough deliveries
| to "pay my rent".
|
| There you have it. The actual "business model" of Doordash.
| jojobas wrote:
| Not issuing bags to the contractors seems like a bad business
| model.
| mcmcmc wrote:
| They do issue insulated bags, they just don't fit pizza boxes
| lathiat wrote:
| Not in Australia. No hot bags for any orders including
| Pizza. It drives me nuts, I never order really now. It's
| not cold enough for the food to be stone cold, but it's
| like warm at best. Not enjoyable at all.
|
| Using a standard supermarket freezer bag makes a HUGE
| difference.
|
| I don't understand how it's not a hard enforced requirement
| by doordash, Uber eats, etc. It's nuts. I have seen it more
| common in other countries where it gets colder. They'll
| have branded delivery bags. Though more often they are also
| bike couriers rather than cars.
|
| Especially since they so often drop two orders now.
| _DeadFred_ wrote:
| How does that pass local food safety laws? There's
| normally requirements food be kept at XYZ temps.
| jabroni_salad wrote:
| Reminds me of my old employer. I was subcontracted to work
| on the controls network at a wastewater treatment plant and
| the PPE they issued me seemed like it was intended for
| elementary school students. Everything I needed was at the
| hardware store for around $15 total so it's not like they
| even saved that much money.
| wsatb wrote:
| Does this still apply? I used to use DoorDash _a lot_ , and
| I remember in the early years, all the dashers had
| DoorDash-branded bags. As the years went on, it seemed a
| lot of dashers no longer had any bag or just didn't use it.
| Maybe it was the latter, but it also feels like one of
| those price cutting measures that a successful startup
| starts making. Like their customer service which went from
| fantastic to terrible to not even talking to anyone, but
| getting refunds denied for no particular reason.
| lumost wrote:
| This is common across so many industries now. The number of
| people stressed by student loans, childcare, and other typical
| expenses is extreme. It's easy for someone to appear more
| productive by having fewer or no kids - but disastrous for the
| economy in the long run.
|
| How much of the recent US economic growth can be attributed to
| monetization of public and private balance sheets?
| fortran77 wrote:
| It's hard to compare student loans--debts taken on willingly
| by the smartest and most privileged members of society--to
| childcare costs.
| r2_pilot wrote:
| Not everyone who takes on this debt is "the smartest and
| most privileged members of society", and childcare costs
| are outrageous (according to several families I know; I
| haven't felt financially secure enough to have my own
| progeny and at this stage in life it seems unlikely I'll
| have the opportunity).
| fortran77 wrote:
| That's why I said "it's hard to compare them". One of
| them is a true problem, and the other is a debt that
| fully informed, smart people elected to take on and plan
| for.
| r2_pilot wrote:
| Nobody is fully informed about anything, whether
| parenting or deciding to assume debt for potential
| education. Not everyone who goes to college is smart in
| all aspects(including finances), and not everyone
| graduates college. These are both true problems whether
| you choose to acknowledge this or not.
| preinheimer wrote:
| 40% of people with student loans didn't graduate. Lots of
| those people probably aren't the "smartest and most
| privileged" you're thinking about.
|
| This video "What everyone gets wrong about student loans"
| really taught me a lot of things.
| https://www.youtube.com/watch?v=wzY-b2Vj9Ug
| Spivak wrote:
| Is this not how every decision is make at a business? Yes it's
| more personal because of the word rent but "no we can't do this
| because the in the slowdown we wouldn't make enough sales to
| pay our employees."
|
| I'm surprised people are siding with the restaurant owner here
| who's a millimeter away from just being a dick and making
| demands of a rando who he's not the boss of. Making "damaging
| my reputation" a thing just invents the very worst of copyright
| but for restaurants. The only thing objectionable about the
| interaction was the delivery app giving the impression they
| have a relationship with the restaurant when they don't.
| Jiro wrote:
| Giving the impression they have a relationship with the
| restaurant is exactly why it's damaging the restaurant's
| reputation. The distinction you make doesn't exist.
| Spivak wrote:
| The act of sending a dasher to a business they don't have
| an explicit relationship to deliver their food -- totally
| fine. The app not making it clear that the restaurant isn't
| partnered with DoorDash and that they're placing a pick-up
| order and delivering it to you -- not fine.
|
| Making "damaging the restaurant's reputation" a thing is
| absurd in all aspects. By the restaurant owner's own logic
| picking up _my own order_ without an insulated bad shouldn
| 't be allowed -- after all what if I get home and the pizza
| isn't as good because it's cold? That could hurt their
| business. Utter nonsense. Do we now have to decide whether
| "it's fair" that something potentially hurts their
| reputation? Is a bad review fair if it's about the food,
| but unfair if it's about the wait?
|
| What DD did is bad because they _impersonated_ the other
| business, not because people got soggy fries. You stop
| getting to curate the dining experience the moment they
| walk out your door.
| baud147258 wrote:
| > These platforms [Grubhub, DoorDash, Uber Eats] are all losing
| money.
|
| Has this changed? Do all these companies still losing money?
| pcthrowaway wrote:
| I'm sure they are. Their dev costs have probably gone down
| since 2020, but I imagine their sales have too. They might even
| be losing more money now.
| financetechbro wrote:
| Dev is not why they are unprofitable. It is mainly due to
| COGS (payout to drivers and other direct costs) & sales and
| marketing aka growth at all cost. Their revenue has not gone
| down
| ceejayoz wrote:
| Uber made a profit for the first time ever this year after
| torching billions to accrue market share for fifteen years.
|
| https://www.theverge.com/2024/2/8/24065999/uber-earnings-pro...
|
| Having to do it via huge price hikes and screwing drivers makes
| me dubious about their ability to do so more than a few times.
| lvspiff wrote:
| how are they not making more money off of data? the trip data
| alone has to be worth millions right? All I see when
| discussing Ubers profits is the cost of trips and the cost of
| drivers and how much they spend on marketing and politicians.
| It seems like theres gaping black hole of all the data they
| are collecting and it being put to use/sale.
| SpicyLemonZest wrote:
| Personal data just isn't worth that much. You sometimes see
| people run around with high estimates where, like, Google's
| entire advertising revenue is attributed to personal data.
| But Uber doesn't run a massively popular advertising
| network, so even if that's a fair attribution it's not
| available to them.
| PaulHoule wrote:
| This. When people say "Data is the new Oil" you should
| point them to
|
| https://en.wikipedia.org/wiki/Exxon_Valdez_oil_spill
|
| It's easy to say that data is immensely valuable, but
| mostly it isn't. How personalized are the ads you see on
| the web, really? What's the ratio of times you clicked on
| an ad accidentally or got tricked into clicking an ad
| (ever had the layout change on Anandtech just before you
| tried to click on a link?)
|
| I used to work for a company that helped other companies
| decide where to place stores. Circa 2007 we were thinking
| about it from the viewpoint of trips and I'd developed a
| touchscreen kiosk that would get visitors to a Dairy
| Queen to tell us where they came from and where they were
| going. We believed that people didn't just go to a fast
| food restaurant that was convenient to their home but
| that they were driving from point A to point B and happen
| to stop at a restaurant along the way so a "good
| location" had a kind of centrality where it was on many
| such paths.
|
| (The project was ill fated. The kiosk we selected was
| rather expensive, particularly for a project we'd sold to
| one franchisee. Our partner dumped us because he thought
| he could get cheaper kiosks, we brought in our lawyers,
| as ahead of its time as it was, we never got put the
| kiosk app in front of customers.)
|
| On one level it's a good idea, but what is the data
| really worth? Chains that work hard at picking good
| locations find their competitors follow them and set up
| shop across the street. The value of the data is based on
| the amount of lift you can get using it relative to the
| alternatives. People often wind up choosing locations for
| other reasons such as Duane Reade who were geniuses at
| finding sites they could afford in the NYC real estate
| market.
| potatolicious wrote:
| There's a fairly common belief that "selling data" is a
| money-printing business, but it generally isn't.
|
| Specifically, data is only worth as much as the buyer is
| able to exploit it to make money. Meta and Google have
| figured out how to immensely profit off of personal data -
| but that's because they own the largest ad networks on the
| planet.
|
| Few other players can leverage personal data to this
| financial extent. More importantly, the players that _can_
| leverage personal data for immense profit _also collect
| their own data_ , and so externally-sourced data is only of
| marginal utility.
|
| And you see this in the discourse around this issue. We
| theorize for example that some grocery chain would "pay a
| lot" for personal data. But to what end? So they can offer
| just-in-time enticements to go to the store?
|
| A lot of these supposed "applications" of personal data
| seem pretty flimsy, and even where they are genuinely
| useful, their monetary worth is marginal.
|
| Data is worth _something_ , but it isn't worth nearly as
| much as widely believed.
| astura wrote:
| >the trip data alone has to be worth millions right?
|
| Who is going to pay _anything_ , let alone millions, for
| Uber trip data?
| bluedino wrote:
| > Having to do it via huge price hikes and screwing drivers
| makes me dubious about their ability to do so more than a few
| times.
|
| So here's my dumb question:
|
| What's with all the people that talk or even brag about how
| much money they make doing ridesharing, food delivery, etc?
|
| Are they just lying?
|
| Are they misinformed, bad at math, etc?
|
| Do 10% of the drivers actually make money, while the rest
| break even or lose money?
| tivert wrote:
| > What's with all the people that talk or even brag about
| how much money they make doing ridesharing, food delivery,
| etc?
|
| Got any examples?
|
| I can think of a few possibilities:
|
| 1. I wouldn't put it past a company like Uber to pay to
| produce propaganda where someone lies about much money you
| can make driving for them. After all, a steady surplus of
| naive and enthusiastic drivers is essential to their
| business model.
|
| 2. You might have some schmuck doing that for the for free,
| by trying to brag about themselves as _personally_
| successful on social media (either for ego reasons or just
| trying to get clicks).
|
| 3. I think a lot of the drivers are "misinformed, bad at
| math." I've read it's pretty common for casual drivers to
| be totally ignorant of some of the major costs they're
| paying indirectly (e.g. not factoring in the wear and tear
| on their car or (more egregiously) fuel costs).
|
| 4. Being a rideshare/food delivery driver may be profitable
| if you're really savvy and have unusual advantages (like
| you live near a stadium and only drive after a baseball
| game during maximum surge pricing).
| astura wrote:
| Likely they don't calculate how much they are making after
| expenses or don't understand how expenses work.
|
| For example, a reddit post I read a little while ago (can't
| find it again) the person said they do ride sharing so got
| to take a lot of deductions on their taxes so they said "on
| paper" it "looks like" they make "much less" than they
| "actually" do.
|
| The comments rightly pointed out the poster's "on paper"
| income is their actual income, because they are deducting
| expenses they paid and it wasn't an accounting trick.
| phantom784 wrote:
| There could be some truth to this based on the vehicle
| you drive.
|
| The IRS gives a flat per-mile deduction, which is an
| estimate of fuel, repair, maintenance, and depreciation
| costs. If your actual vehicle expenses are lower, then
| you are making more money than your taxable income.
| astura wrote:
| Sure, you might be ahead a bit more than "on paper" but
| you still have significant expenses that were actually
| accrued. The context of this post was the person thought
| their "actual" salary didn't include their (significant)
| expenses and being eligible for deductions was just a
| bonus. They argued in the comments their salary was
| "really" their pre-deduction salary, I guess because
| that's what went into their bank account.
|
| They were also asking if they should just stop taking
| these deductions for a few years for some reason (I think
| to qualify for a mortgage), so they weren't exactly
| understanding finance.
|
| I wish I could find the post again, it was baffling.
| JumpCrisscross wrote:
| > _you still have significant expenses that were actually
| accrued_
|
| It really depends on the numbers. If you're savvy, 1099
| income lets you deduct quite aggressively, and I can see
| the IRS not really caring about delivery drivers' income.
| Workaccount2 wrote:
| I worked deliveries a long time ago, before the age of food
| order apps, but at least at the time pretty much all
| drivers calculated their pay without considering expenses.
| It can easily be 30% of your pretax take-home, but the cost
| is mostly hidden until your car breaks, your tires wear, or
| you need to sell your car.
| ben_jones wrote:
| Have you ever seen an instagram post where someone flashes
| wealth they don't truly have? Be it a rented Lamborghini or
| a stack of twenty dollar dolls? Or a stack of ones with a
| couple hundred obfuscating the other denominations?
|
| There are more incentives to flaunt success then
| bankruptcy. Even if the success isn't real.
| Suppafly wrote:
| Most of them are bad at math because they ignore a lot of
| variables like wear and tear on their vehicles and the fact
| that their car insurance doesn't cover them using their
| private vehicle for commercial purposes. It's one of those
| things that profitable in the short-term but only if you
| ignore long term costs. Granted some people might have
| somewhat legitimate reasons for ignoring those costs or may
| have made some cost benefit analysis in which it makes
| sense for them, but overall it tends to be a net negative
| if you actually include all of the costs.
| skrbjc wrote:
| Pretty sure it's becoming increasingly common that one
| person runs a fleet of drivers that they have imported from
| a foreign country. The primary person sets up all the
| accounts, and provides the cars, etc and the drivers do the
| deliveries and get paid a minuscule amount. In many cases
| they're akin to indentured servants that also live in
| packed housing owned by the "boss", to whom they also pay
| rent. The workers get their tiny sliver of money and send
| it home to help out their families, with the hope they can
| eventually establish themselves in the US.
| RandallBrown wrote:
| I believe Grubhub was profitable for years before they started
| offering their own delivery and had to compete with money
| losing companies like Uber and DoorDash.
| reedf1 wrote:
| Wait what? What's preventing merchants from doing this now? Why
| even fill the pizza boxes? I must be missing something...
| boomboomsubban wrote:
| DoorDash created the shop portal with no input from the store,
| and then put up incorrect prices. If that scenario still
| exists, they could still do this, but most of the time the
| store has some kind of deal with DoorDash so they would be
| responsible for pricing.
|
| As for why fill the boxes, technically DoorDash would be the
| store's customer, so if you didn't give them what was ordered
| they could press the issue. It'd be hard to police, as the
| person making the DoorDash order wouldn't complain, but it adds
| a way things could fail.
|
| Plus, the post said dough at that scale is practically free.
| codetrotter wrote:
| Doesn't the driver notice that the boxes weigh almost
| nothing? Doesn't he say anything?
|
| If I was driver and the pizzeria handed me empty boxes I'd
| refuse to deliver and I'd call DoorDash. Ain't no way I'd
| take empty boxes to a customer and then have the customer
| potentially accuse me of removing all of the food they paid
| for.
| boomboomsubban wrote:
| They didn't send empty boxes, and as that's basically why.
| forinti wrote:
| The restaurant could easily get into an agreement with the
| driver.
| phantom784 wrote:
| Odds are they get a different driver every time they do
| this.
| Workaccount2 wrote:
| They were putting just dough in the boxes.
| RandallBrown wrote:
| The DoorDash drivers don't care _at all_. I got an empty
| cup with my order recently. The guy just handed it to me,
| smiled, and walked away.
| Spivak wrote:
| And they shouldn't, they're couriers. It's crazy to me to
| blame FedEx for delivering an empty shoe box that was
| shipped by Nike. I bet that dasher was so damn excited to
| give you that cup. I would have been laughing my ass off.
| throwaway_serp wrote:
| sliceline, sort of a rhyme pun
| vanjajaja1 wrote:
| did this happen before or after the silicon valley episode
| forinti wrote:
| > You have insanely large pools of capital creating an incredibly
| inefficient money-losing business model. It's used to subsidize
| an untenable customer expectation. You leverage a broken
| workforce to minimize your genuine labor expenses. The companies
| unload their capital cannons on customer acquisition, while this
| week's Uber-Grubhub news reminds us, the only viable endgame is a
| promise of monopoly concentration and increased prices. But is
| that even viable?
|
| Inequality is driving this. We have let money become so
| accumulated, that the owners of the capital are being silly with
| it at the same time that workers are having a hard time. We have
| to tax this capital and make it work for everyone.
| saint_fiasco wrote:
| But the whole point is that in this case the money is not
| accumulated. Lots of different companies are each spending a
| lot of money in the hopes that they will be the last standing,
| at which point they will get to accumulate the money.
|
| It's possible that if one company does end up with a monopoly,
| they will treat their employees better. Because then they will
| finally be able to charge higher prices to the customers
| without losing those customers to the other more exploitative
| businesses.
| wpm wrote:
| The money they're spending didn't poof into existence, it's
| coming from private equity and investors that accumulated it.
| saint_fiasco wrote:
| Right, they must have accumulated the money beforehand. But
| what they are doing right now with it is the opposite of
| accumulating it. They are taking the money that they
| previously accumulated and spending it on lots of random
| bullshit.
|
| Suppose you were to discourage accumulation, with a tax for
| example. Wouldn't that lead to investors investing in even
| more random bullshit?
| kragen wrote:
| plausibly the money was just printed rather than being
| accumulated. the article is from the zero interest rate
| epoch
| lambertsimnel wrote:
| > It's possible that if one company does end up with a
| monopoly, they will treat their employees better.
|
| If they can get away with paying employees so little, why
| would they voluntarily pay more as a monopoly? (Presumably
| they wouldn't have a monopoly in the labour market, in which
| case I would expect pay to remain the same, rather than
| worsen.)
| fortran77 wrote:
| Won't blowing money like this redistribute it quickly, taking
| care of the "inequality"? It looks like this is a good way to
| take wealth from people who have accumulated it (the investors)
| and disperse it widely.
|
| I can't make your argument make any sense.
| chasing wrote:
| Burn a billion dollars. Artificially pump the market value of
| your company by 10 billion dollars. Pizza company gets a few
| hundred dollars for free. "Haha, we pulled one over on the
| man!" Go public or sell. Founders and initial investors
| (likely already wealthy) get billions. Other people take the
| hit.
|
| No, this does not distribute wealth down. It's a ploy to gin
| up enough excitement that people who are already wealthy can
| expand that wealth dramatically with weak business offerings
| while leaving other people (smaller investors, employees,
| customers, other businesses, the government, the public at
| large) to hold the bag.
|
| Not every start-up is like this, but a lot of 'em sure are!
| blargey wrote:
| Any "redistribution" is in the form of wages, so it's income
| based in the _exact opposite direction_ of what people want
| from wealth redistribution, or think of when they say "wealth
| redistribution".
|
| C suite gets giant cuts, office workers get medium-large cuts
| based on career, gig workers just have a new type of low-wage
| part-time labor to fill their hours with.
|
| Money technically changes hands, but calling the existence of
| a company with status-quo wages "wealth redistribution" is
| really taking the term too literally.
| walr000s wrote:
| >We have let money become so accumulated, that the owners of
| the capital are being silly with it
|
| Is that not just an inherent part of the debt cycle that we are
| at the tail end of?
| bko wrote:
| Isn't this a problem that fixes itself? People have lots of
| money and throw it at stupid businesses and lose it.
| nicbou wrote:
| They aren't building libraries with it, but sustaining an
| underpaid workforce. Someone loses a million, a million gets
| a few cents.
| jjmarr wrote:
| So, direct wealth transfer is happening from the rich to
| the poor.
|
| The only flaw with this is that people have to work
| economically inefficient jobs delivering food, instead of
| the wealth transfer occurring through taxes on the rich and
| funding something like basic sciences.
| dralley wrote:
| It's equivalent to "broken window" spending.
|
| Yes, breaking a window allows you to generate economic
| activity by paying the manufacturer to create a new one
| and paying an installer to install it, but it's not
| socially useful economic activity. You could have spent
| the same money building excess renewable energy
| resources, or on basic science research, or a million
| other things that might be equally "inefficient" from an
| investment standpoint but at least have a chance of
| providing benefit to society.
|
| It's a serious flaw and not one that can be waved off as
| easily as you do.
| ianferrel wrote:
| I disagree with that.
|
| In the case of food delivery, there's socially and
| economically useful work of getting food from where it
| can be efficiently created (restaurants) to where it can
| be efficiently consumed (hungry people's location). In
| the absence of that work, the hungry people would be
| making their own food (less efficient, generally, than
| restaurant cooking which can do larger batches) or going
| to get their own food (less efficient, at least
| plausibly, because a delivery worker can make multiple
| deliveries on one drive rather than a strict out and back
| trip that people would take).
|
| The thing that makes fixing a broken window "fake"
| economic growth is that it is arguing that _destruction_
| is economically useful because of the work to fix it, but
| nothing 's being broken in this case. People are
| naturally hungry on a pretty regular basis, and the
| production and transportation of food is economically and
| socially useful work, which in this case was being
| subsidized by capital.
|
| Is it curing cancer? No, but it's not digging holes and
| filling them up again either.
| nsxwolf wrote:
| It's completely ruined pizza delivery, which used to
| actually be a pleasant and affordable experience.
| Chris2048 wrote:
| I've heard of the "broken window fallacy", and this seems
| an incorrect representation.
|
| The fallacy is that breaking windows must have an
| inherent value (and the fallacy is that its a _good_
| thing to have vandalism). Part of the justification that
| it might be otherwise is the benefit of having window
| repairmen, and how they couldn 't exist if they didn't
| have a steady income - and it's here that lies the fault,
| however the fault is one of quantification, in fact a
| broken window _can_ be socially useful, just with
| decreasing usefulness as quantity increases, plus there
| are better ways to do it (e.g. insurance payment); It 's
| still true that (in an unmanaged market) if (somehow)
| there aren't enough broken windows, when one breaks there
| might not be anyone who can repair it (economically) - I
| think it's the same category of problem as, donating
| clothes to Africa destroys its own textile biz.
| digging wrote:
| No, this misses that much of the money is just circulating
| around the capital holders.
| madaxe_again wrote:
| No, because it's a circular economy - at no point does that
| wealth reach workers, it just ends up in the hands of _other_
| plutocrats.
| RandallBrown wrote:
| How exactly does the money that a company like DoorDash
| loses end up with other plutocrats?
|
| Isn't most of that money being paid to people working for
| those companies?
| lambertsimnel wrote:
| Am I right in thinking that if those employees save any
| of the money, then they accumulate wealth, but if they
| don't (because they don't receive enough compared to
| their fixed costs, or for any other reason) wealth
| accumulates elsewhere, probably in the hands of
| plutocrats?
| nickff wrote:
| Just because one person wastes money, it doesn't mean
| that someone else gets rich. If the employees spend their
| income on low-margin goods or services (food and clothing
| are quite competitive low-margin sectors with high labor
| costs), the money has flowed from investors mostly to
| laborers.
| lambertsimnel wrote:
| My thinking is that spending gets split between richer
| and poorer people. The former buy assets with it, but the
| latter spend it on living costs. Each time it circulates,
| typically some goes to richer people and stops
| circulating.
|
| Various things could disrupt the resulting increase in
| inequality. The Black Death and World War 2 are both
| supposed to have done so.
| nickff wrote:
| Money doesn't really get "split", it flows, and the where
| it goes each time it is spent is what determines who
| makes how much. You're right that some people are able to
| accumulate, but that's not a default, and the money
| usually doesn't stay put for long.
| solarpunk wrote:
| I think doordash drivers have to pay for things like gas
| and cars.
| al_borland wrote:
| With these food delivery apps they managed to make a system
| where everyone loses. It's astounding. When everyone is
| paying more, while earning less, I'm not sure how the problem
| fixes itself.
|
| I think these apps just need to go away and business that
| want to offer delivery can go back to how it used to be done.
| It was cheaper and better.
| itsdavesanders wrote:
| IS it cheaper? Better, maybe, depending on the restaurant.
| But I can't see how it's cheaper when you have to hire and
| insure drivers, manage shifts, deal with delivery areas,
| fuel costs, more accounting, etc etc.
|
| Also I live in a pretty good sized city of about 350k in
| our metro area, and before these delivery services only the
| national pizza places delivered. When I moved here from a
| larger city I was shocked there wasn't a single Chinese
| delivery place. So I'm thinking that the costs and
| management were just too high.
|
| The right model might be the Waiter on the Way model, which
| hires regular drivers but can offer the service turnkey.
| But there needs to be more of those, and there doesn't seem
| to be for some reason.
| dom96 wrote:
| I lived in a tiny town in Northern Ireland and every
| chinese/indian/pizza place managed to deliver food just
| fine. They still do I bet. UberEats/Deliveroo/DoorDash
| are just skimming the little profit that these operations
| made (and failing to be profitable)
| insane_dreamer wrote:
| Ultimately it's driven by customer behavior. If people went to
| restaurants instead of expecting to be served hot food in their
| living room, this whole destructive business model wouldn't
| even exist or would be small enough as to not be negatively
| impactful.
|
| People are not forced to use DoorDash, UberEats, etc. We never
| do and are surviving just fine.
| digging wrote:
| > Ultimately it's driven by customer behavior. If people went
| to restaurants instead of expecting to be served hot food in
| their living room, this whole destructive business model
| wouldn't even exist or would be small enough as to not be
| negatively impactful.
|
| No, you've got that backward. Customer behavior is driven by
| the tides of capital. Advertising is a pretty clear example
| but it's not the limit. I mean, how many people were ordering
| DoorDash before DoorDash existed? I'm not being entirely
| facetious - it's impossible for customers to behave in a way
| that's not allowed by the market.
|
| That you are resistant to these tides is not evidence
| against, it's just accounted for. You're not the target
| audience. Nor am I. But neither of us has ever made a
| decision in a vacuum; we choose our purchases from what's
| available, according to the information we're exposed to.
| JumpCrisscross wrote:
| > _Customer behavior is driven by the tides of capital_
|
| Source?
|
| The best argument against this is how elastic demand was
| when ZIRP ended. Customers responded to an underpriced
| product. When the price was raised to a profit-clearing
| level, it no longer cleared most of the market.
| digging wrote:
| I don't understand your argument. It sounds like
| customers were reacting to their environment more than
| driving change.
| JumpCrisscross wrote:
| > _sounds like customers were reacting to their
| environment more than driving change_
|
| It sounds like customers had agency. Tides of capital
| gave them more or fewer options, and they chose them at
| their discretion when the terms were advantageous. When
| they weren't, ever or any longer, they didn't.
| digging wrote:
| ...In other words, because DoorDash is convenient and
| advantageous for customers, they choose to get food
| delivered instead of go to the restaurant. And
| admonishing people for choosing the advantageous option
| is useless, at best. Does that not follow?
| JumpCrisscross wrote:
| You argued "customer behavior is driven by the tides of
| capital." That's attributing cause and effect. The tides
| of capital didn't cause the customer behaviour, it
| enabled existing behaviour to scale. Capital driving
| behaviour describes diamonds, not DoorDash.
| digging wrote:
| I'm really confused by your reply, and it doesn't answer
| the question I posed, so maybe that's that.
| insane_dreamer wrote:
| There is no doubt that advertising has a huge impact on
| customer behavior. But that doesn't mean that consumers are
| incapable of making choices that go against the grain of
| the market. It does take a conscious effort, and it's true
| that most consumers just don't care or can't be bothered
| with it, or are crushed by too many other things in our
| modern society to have the bandwidth to even consider their
| choices.
| digging wrote:
| Everything you're saying is exactly in accord with what I
| posted. Individuals always have choice, but when we're
| looking at an entire population and seeing that large
| amounts of people are making a choice that we think is
| "bad", saying, "Well people just need to stop making bad
| choices. People are stupid. _I_ make good choices. " is
| ludicrous.
|
| Let's assume that the answer really is to ensure
| individual choices are changed. Who's going to go house
| to house and educate everyone about why the choice to use
| DoorDash is problematic? Does this person have the time
| to customize their solutions to every family's needs?
| It's insanity. It's an argument that leads nowhere at
| all; it's an abdication of responsibility (which is
| totally unnecessary, because the commenter never _had_ a
| responsibility to change the situation). Hell, it 's _a
| call for the audience_ to also abdicate responsibility
| they might feel. It 's just a useless or harmful way of
| telling listeners how proud one is to be a statistical
| exception.
| insane_dreamer wrote:
| Yeah I was basically agreeing with you.
| beloch wrote:
| The delivery service in my area has no competition. You order
| from their version of restaurant menus on which the prices
| have been jacked up. Then you pay a delivery fee. Then you
| pay a service fee. Then you have to deal with drivers making
| minimum wage who can be surly if not tipped enough. It more
| than doubles the price of a meal, so few people use it.
|
| Is this DoorDash's plan once they've driven their competitors
| out of the market? The market will shrink and it will take
| quite some time to recoup their expenses. Maybe that's okay
| in their books. Own the whole pie even if you shrink it.
| colechristensen wrote:
| Food delivery has been a thing for a very very long time.
|
| The problem here is that there's a $45B company (doordash) in
| the middle of the person cooking the food and the person
| delivering the food instead of a high school kid in a funny
| hat.
|
| Exchanging the overhead of a dining room for the overhead of
| unskilled labor taking food to a place is an easy win for a
| restaurant. Doordash and the like are taking jobs that you
| could train a child to do in an hour (take an order, deliver
| it to a place) and spending billions on the technology to do
| instead while still requiring unskilled labor to do the job.
|
| This is the kind of software that needs to be a small scale
| distributed open source affair instead of a $45B company with
| several competitors at the same scale.
|
| They started selling their product as if it were basically
| free by burning investor cache and now they're riding the
| limited rails of brand recognition and habit while trying to
| charge for the ridiculous amount they're doing for such a
| simple task.
| josefresco wrote:
| > Food delivery has been a thing for a very very long time.
| > The problem here is that there's a $45B company
| (doordash) in the middle of the person cooking the food and
| the person delivering the food instead of a high school kid
| in a funny hat > This is the kind of software that needs to
| be a small scale distributed
|
| Related: a few years back before DoorDash and the like
| exploded in popularity there was a local company near me
| who tried to start a food delivery business. They lasted
| one summer (busy) season and then made a post on social
| media about how unsustainable it was. These services
| (Uber/DoorDash) are only seemingly viable because of the
| mountain of "investor cache".
| insane_dreamer wrote:
| > Food delivery has been a thing for a very very long time.
|
| But not at this scale; it was always a side offer from a
| more select number of restaurants catering more to pressing
| needs than an "immediate satisfaction" culture driven by
| same-day shipping.
| dml2135 wrote:
| There are food delivery companies, such as Toast and
| ChowNow, that seem more restaurant-oriented. As in, they
| sell an online-ordering-platform-as-a-service to
| restaurants (sometimes bundled with a POS system), rather
| than gunning for market dominance on the consumer side of
| things.
|
| I think that's probably a viable model for the future,
| assuming they don't have VCs that will push them to squeeze
| restaurants like the big apps, at some point.
| mikejulietbravo wrote:
| This is the biggest point. You can simply not use them. Cook
| your own food or walk or drive or bike to a restaurant.
|
| There is a massive market of lazy AF people who also are
| terrible at personal financial management, and they are the
| ones complaining.
| dml2135 wrote:
| I hear this a lot but I don't think the "lazy AF people who
| also are terrible at personal financial management" is
| really fair.
|
| I order delivery through the apps a ton, but it's not
| because I'm bad at financial management. Like many here, I
| have a well paying job that takes up a ton of my time and
| energy during the week, and cooking every night is simply
| not feasible. Takeout is expensive, sure, but if it enables
| me to hold down a job that let's me afford it, it's a
| conscious trade-off that I can make.
|
| Could I spend more time meal-prepping and freeze meals
| instead? Sure. But again, time and energy.
| standardUser wrote:
| There's also seemingly an army of judgy AF people just
| salivating at the chance to call other people lazy.
| nsxwolf wrote:
| You know, I do go to restaurants, and DoorDash is making
| restaurants worse. They're becoming DoorDash focused and the
| dining room experience suffers.
|
| Even picking up your own food is becoming destroyed. Orders
| get made with no regard to the estimated pickup times you
| used to be able to rely on. Your order might get made
| immediately and just tossed onto a pickup shelf where it sits
| getting cold for half an hour.
|
| This is all because DoorDash guarantees absolute shit quality
| and accuracy. Cold food, wrong orders, and they've trained
| people to not complain by threatening to ban you from the
| service. So instead of the son of the owner of the pizza
| place rushing right out to make your order right with an
| apology, you just accept that an 80% correct order is OK.
|
| A whole generation of young adults has come of age with this
| thanks to COVID, so we're just stuck with it now.
| mikejulietbravo wrote:
| Taxes are not the answer, let the free market figure it out
| saagarjha wrote:
| ...which seems to be going poorly?
| SoftTalker wrote:
| I'm surprised more restaurants aren't suing DoorDash for damage
| to their reputation.
|
| Inserting themselves unrequested into the ordering process, then
| delivering cold food, the wrong food, etc. the customers just
| blame the restaurant ultimately.
| readyman wrote:
| > _I 'm surprised more restaurants aren't suing DoorDash for
| damage to their reputation._
|
| I'm not. They have every reason to expect DoorDash to throw the
| book at them if they did that. They'd likely end up bankrupt.
| rst wrote:
| It's been worse -- they've been caught setting up ghost
| kitchens in the name of real restaurants that didn't offer
| delivery or take-out service, and siphoning off order flow. One
| Michelin-star restaurateur found out about this when she got
| complaints about a delivery order placed to Seamless, which was
| pretending to offer delivery from her place, but was actually a
| ghost kitchen she'd never heard of ...
|
| https://www.eater.com/2020/1/29/21113416/grubhub-seamless-ki...
| JumpCrisscross wrote:
| > _they 've been caught setting up ghost kitchens in the name
| of real restaurants_
|
| This blows me away every time I'm in New York. They all do
| it. An everyone seems to be fine with it. (In that nobody is
| suing.)
| _DeadFred_ wrote:
| I'm surprised health departments aren't shutting down doordash.
| There are actual food safety rules to ensure food has been kept
| properly, kept at proper temps, kept in sanitary condition,
| etc.
| cm2012 wrote:
| Both Uber Eats and DoorDash made restaurant listings without
| permission at first, just like Reddit seeded threads with their
| own comments at first. It's just a necessary part of building
| something that requires economy of scale. Neither platform does
| this anymore to my understanding.
| electrondood wrote:
| DoorDash is wonderful if you want to pay 30% more for the same
| item, and then add tax and tip on top of that. Restaurants pass
| on the platform fee to you.
|
| It's idiotic. Just phone it in directly and go pick it up.
| iamthirsty wrote:
| > It's idiotic. Just phone it in directly and go pick it up.
|
| I don't have a car at the moment -- am I just never supposed to
| eat outside of home-made food anymore? I've done that math many
| times, Ubering both ways to a restaurant is even dramatically
| more expensive than a delivery service.
|
| If you don't live in an extremely walk-able place, sometimes
| it's the only option.
| erehweb wrote:
| For some people, the tradeoff of cost:time is worth it.
| bongodongobob wrote:
| I'll gladly pay $10-15 to not have to drive 10-15 minutes to
| the restaurant, wait a few minutes and 10-15 minutes back home.
| Especially in winter where I'd have to warm my car up for 10
| minutes.
| JumpCrisscross wrote:
| > _It 's idiotic. Just phone it in directly and go pick it up._
|
| It's often hot or rainy out, or I don't want to get dressed
| yet, or the restaurant is far away. Paying a premium for time
| and convenience is far from "idiotic."
| Apocryphon wrote:
| From the same writers: ZIRP Explains the World
|
| https://www.readmargins.com/p/zirp-explains-the-world
|
| These should prove to be historical pieces of import, capturing
| the state of tech in the last days before raised interest rates.
| tomcar288 wrote:
| People wonder why investors are piling so much money into losing
| companies. well, here's the answer:
|
| Most investments are actually Bad https://www.lynalden.com/most-
| investments-are-bad/
| nobody9999 wrote:
| Door Dash/Seamless/Uber Eats, etc. have driven many low-priced
| restaurants out of business here in New York City many of which
| had long traditions of providing delivery services for their food
| by inserting themselves as middlemen and taking all those
| restaurants' profits _and more_.
|
| I realize that in many places, they provide services that never
| existed before, but here in NYC they've driven hundreds of
| wonderful mom and pop restaurants out of business while they lost
| billions.
|
| Those entrepreneurs who ran successful businesses for _decades_
| were forced out of business, as their quality, inexpensive food
| (especially in an expensive place like NYC) only netted them
| 5-10% profits, which were more than eaten up by the 15-30%
| charged on _every_ order.
|
| I'd rather starve than give any of those jerks a nickel.
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