4 ms·

Sometimes I wonder if this whole food delivery boom is being supported by millenials who simply haven't faced the need (or desire) to budget yet. How sustainab

by nugget 11y ago

Sometimes I wonder if this whole food delivery boom is being supported by millenials who simply haven't faced the need (or desire) to budget yet. How sustainable is spending $25 per person per meal for those outside the top quintile? I know it works in San Francisco and NYC, but how deep is the market elsewhere? Or does that not matter? Maybe a significant number of them will never have families and all that disposable income will go to postmates and doordash instead. Maybe these businesses are built on price insensitive folks in urban areas for regular usage and irregular usage from everyone else?

qq66 11y ago
All of these businesses are predicated upon an ever-increasing erosion of the middle class, increasing the number of customers and depressing wages for the workers by increasing the supply of people competing for the jobs.
- nugget 11y ago
  I suppose that benefits them on both sides of their marketplace: the # of less price sensitive consumers in the upper class increases and the # of (educated, reliable, service oriented) people available for cheap on demand labor in the lower class increases as well. The hourglass distribution is a nice tailwind. I wonder how many young people are temporarily part of the demand equation when they are working 24/7 for a high wage and have no dependents and a low to zero (or negative) savings rate. From watching my friends it seems that once you have a child your attitude towards expenses and savings changes dramatically.
ashishk 11y ago
It's possible the prices will fall. Food is a commodity and commodities want to be cheap. Drones, robots, delivery systems, etc. How much of the current cost is labor that will be replaced by software?
superuser2 11y ago
Like all food delivery, which has existed for a long time, normal people use food delivery apps occasionally when they want to feed a group, can't leave (in college I worked in tech theater and Grubhub was a godsend for short dinner breaks), or don't feel like cooking today. You may as well be amused that sit-down restaurants exist.
- nugget 11y ago
  Sure, my point is just that food delivery is one of the most expensive options for feeding oneself (compared to cooking at home or take out). People order food a few times a week, but it seems unlikely for them to redesign their lives around it long-term (in the rest of the world outside San Francisco/NYC that is not populated by wealthy single folks). Unlike other services like Uber, which can save $ by allowing you to ditch the car and have allowed people to permanently alter their lifestyles. I assume that there is some thesis baked into these business plans that food delivery will become more wide spread, and more frequent. Perhaps that people actually prefer to be served at home instead of going out, and that the savings from rent and waiters can be captured by these services instead.
  - superuser2 11y ago
    I think of food delivery apps as an incremental efficiency. Rather than restaurants needing to maintain their own staff, you can take advantage of a collective network of drivers with an optimized central route planner. This should be successful for the simple reason that it's better for restaurant owners and consumers of restaurants that do not (or will no longer) have their own fleet. I don't think it's going to "revolutionize" anyone's lifestyle the way Uber did. They might say so, but that's because no one wants to talk to you in the Bay Area if you're not disrupting something.
lsc 11y ago
Food delivery was one of the things I remember the most clearly about working in the bay area in the late '90s during the first dot-com. anyone remember Kozmo.com? webvan, etc...? there were so many! So, to me, nothing says "bubble" quite like food delivery companies. In some ways, it really is the perfect thing for silicon valley during boom time. If you are paying three grand a month for a one-bedroom apartment, paying forty bucks for a really good delivered dinner doesn't seem like that big of a deal. The interesting thing to remember about the first wave of food delivery companies is that some of them survived the crash... which is really quite a feat, because a lot of people went from being really wealthy to being... not. But you can still order from waiter.com.

by nugget 11y ago

qq66 11y ago

All of these businesses are predicated upon an ever-increasing erosion of the middle class, increasing the number of customers and depressing wages for the workers by increasing the supply of people competing for the jobs.

nugget 11y ago
I suppose that benefits them on both sides of their marketplace: the # of less price sensitive consumers in the upper class increases and the # of (educated, reliable, service oriented) people available for cheap on demand labor in the lower class increases as well. The hourglass distribution is a nice tailwind. I wonder how many young people are temporarily part of the demand equation when they are working 24/7 for a high wage and have no dependents and a low to zero (or negative) savings rate. From watching my friends it seems that once you have a child your attitude towards expenses and savings changes dramatically.

ashishk 11y ago

It's possible the prices will fall. Food is a commodity and commodities want to be cheap. Drones, robots, delivery systems, etc. How much of the current cost is labor that will be replaced by software?

superuser2 11y ago

Like all food delivery, which has existed for a long time, normal people use food delivery apps occasionally when they want to feed a group, can't leave (in college I worked in tech theater and Grubhub was a godsend for short dinner breaks), or don't feel like cooking today. You may as well be amused that sit-down restaurants exist.

nugget 11y ago
Sure, my point is just that food delivery is one of the most expensive options for feeding oneself (compared to cooking at home or take out). People order food a few times a week, but it seems unlikely for them to redesign their lives around it long-term (in the rest of the world outside San Francisco/NYC that is not populated by wealthy single folks). Unlike other services like Uber, which can save $ by allowing you to ditch the car and have allowed people to permanently alter their lifestyles. I assume that there is some thesis baked into these business plans that food delivery will become more wide spread, and more frequent. Perhaps that people actually prefer to be served at home instead of going out, and that the savings from rent and waiters can be captured by these services instead.
- superuser2 11y ago
  I think of food delivery apps as an incremental efficiency. Rather than restaurants needing to maintain their own staff, you can take advantage of a collective network of drivers with an optimized central route planner. This should be successful for the simple reason that it's better for restaurant owners and consumers of restaurants that do not (or will no longer) have their own fleet. I don't think it's going to "revolutionize" anyone's lifestyle the way Uber did. They might say so, but that's because no one wants to talk to you in the Bay Area if you're not disrupting something.

lsc 11y ago

Food delivery was one of the things I remember the most clearly about working in the bay area in the late '90s during the first dot-com. anyone remember Kozmo.com? webvan, etc...? there were so many! So, to me, nothing says "bubble" quite like food delivery companies. In some ways, it really is the perfect thing for silicon valley during boom time. If you are paying three grand a month for a one-bedroom apartment, paying forty bucks for a really good delivered dinner doesn't seem like that big of a deal. The interesting thing to remember about the first wave of food delivery companies is that some of them survived the crash... which is really quite a feat, because a lot of people went from being really wealthy to being... not. But you can still order from waiter.com.