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Is it though? Most pizza delivery is an ancillary service to the restaurant itself. Are there very many profitable pizza-delivery only businesses? Also you c

Is it though? Most pizza delivery is an ancillary service to the restaurant itself. Are there very many profitable pizza-delivery only businesses? Also you could argue that for the genre of restaurants where delivery is profitable as an ancillary service (pizza, chinese, etc.), they already offer delivery and there isn't any profitable market for the restaurants where they didn't have it before.

cosmodisk 7y ago
It's not profitable because every single restaurant does it for itself only.A post office service would never make a dime if it was only covering a small town.Scale it up to the entire city and it becomes very interesting
- komali2 7y ago
  Back in frontier west, outside US territory (and therefore not served by the Post Office Department or the Pony Express), people would set up highly profitable transportation companies. These companies would make deliveries for local shops but also carry mail, bringing stuff to somewhere served by the Post Office Department or the Pony Express or the Wells Fargo freight routes. I read all this in a book ages ago but I was skimming through some wikipedia articles that mention some of what I'm talking about if you're interested: https://en.wikipedia.org/wiki/American_frontier https://en.wikipedia.org/wiki/American_frontier https://en.wikipedia.org/wiki/Pony_Express#Stations https://en.wikipedia.org/wiki/Pony_Express#Stations
  - sjg007 7y ago
    I mean this was how Wells Fargo started.
- bduerst 7y ago
  Yes, I understand economies of scale, but there is a point where the time and resources spent driving take-out around is not profitable. That's what I mean about certain restaurants and cafes not offering delivery, because even with a third party full time delivery service it's not profitable to deliver certain goods.
paulcole 7y ago
> Most pizza delivery is an ancillary service to the restaurant itself. Are you sure? Seems like the restaurant mostly exists for marketing, awareness, and as a place for people to not come in and eat. 90% of Pizza Hut’s orders are deliveries. 65% of Domino’s are deliveries. Over the entire industry, carry-out and delivery account for over 75% of revenue (delivery alone is 30% or so). • https://www.cnbc.com/2018/12/05/pizza-hut-execs-dissatisfied-with-growth-brand-has-a-lot-of-work.html https://www.cnbc.com/2018/12/05/pizza-hut-execs-dissatisfied... • https://www.reuters.com/article/us-dominos-pizza-delivery/dominos-unveils-pizza-delivery-hotspots-as-competition-rages-idUSKBN1HN18R https://www.reuters.com/article/us-dominos-pizza-delivery/do... • https://www.statista.com/topics/1610/pizza-delivery-market/ https://www.statista.com/topics/1610/pizza-delivery-market/
- bduerst 7y ago
  Is that really profitable though? Your article talks about how Pizza Hut is struggling as it switched to digital delivery. Also according your statista link, delivery only accounts for 30% of revenue in the pizza industry.
  - paulcole 7y ago
    Your intuition is probably spot on. Dominos stock has been doing terribly and pizza delivery will likely cease to exist because it is a constant money loser.
    - askafriend 7y ago
      This is...not correct at all. Dominoes stock has been on an absolute tear the past decade. I don't know what charts you're looking at...
      - bduerst 7y ago
        They've plateaued this past year with negative growth. Is what dominoes was doing a decade ago really relevant?
wp381640 7y ago
Lookup the stock of Domino's[0] - they've been on a years long tear by scaling delivery and adopting tech In theory this could work better for some food delivery companies as they charge the restaurant rather than produce themselves and run the overhead of stores, etc. [0] http://www.google.com/finance?q=NYSE:DPZ http://www.google.com/finance?q=NYSE:DPZ
- williamDafoe 7y ago
  I think it's pretty obvious that nobody buys a Domino's Pizza because it tastes good! They buy it because someone shows up at your door and gives you food!
  - mruts 7y ago
    I mean, they’re not terrible. I think I prefer them to other Pizza chains. And they have a dope app.
tallanvor 7y ago
Domino's and Little Caesars are the second and third largest pizza chains in the US. Some of them may have space for a few people to eat there, but their entire business structure is based on delivering pizzas. Sure, they have pick-up options as well, but I wouldn't say that changes them from being developed around the idea of delivering the pizzas.

cosmodisk 7y ago

It's not profitable because every single restaurant does it for itself only.A post office service would never make a dime if it was only covering a small town.Scale it up to the entire city and it becomes very interesting

komali2 7y ago
Back in frontier west, outside US territory (and therefore not served by the Post Office Department or the Pony Express), people would set up highly profitable transportation companies. These companies would make deliveries for local shops but also carry mail, bringing stuff to somewhere served by the Post Office Department or the Pony Express or the Wells Fargo freight routes. I read all this in a book ages ago but I was skimming through some wikipedia articles that mention some of what I'm talking about if you're interested: https://en.wikipedia.org/wiki/American_frontier https://en.wikipedia.org/wiki/American_frontier https://en.wikipedia.org/wiki/Pony_Express#Stations https://en.wikipedia.org/wiki/Pony_Express#Stations
- sjg007 7y ago
  I mean this was how Wells Fargo started.
bduerst 7y ago
Yes, I understand economies of scale, but there is a point where the time and resources spent driving take-out around is not profitable. That's what I mean about certain restaurants and cafes not offering delivery, because even with a third party full time delivery service it's not profitable to deliver certain goods.

paulcole 7y ago

> Most pizza delivery is an ancillary service to the restaurant itself. Are you sure? Seems like the restaurant mostly exists for marketing, awareness, and as a place for people to not come in and eat. 90% of Pizza Hut’s orders are deliveries. 65% of Domino’s are deliveries. Over the entire industry, carry-out and delivery account for over 75% of revenue (delivery alone is 30% or so). • https://www.cnbc.com/2018/12/05/pizza-hut-execs-dissatisfied-with-growth-brand-has-a-lot-of-work.html https://www.cnbc.com/2018/12/05/pizza-hut-execs-dissatisfied... • https://www.reuters.com/article/us-dominos-pizza-delivery/dominos-unveils-pizza-delivery-hotspots-as-competition-rages-idUSKBN1HN18R https://www.reuters.com/article/us-dominos-pizza-delivery/do... • https://www.statista.com/topics/1610/pizza-delivery-market/ https://www.statista.com/topics/1610/pizza-delivery-market/

bduerst 7y ago
Is that really profitable though? Your article talks about how Pizza Hut is struggling as it switched to digital delivery. Also according your statista link, delivery only accounts for 30% of revenue in the pizza industry.
- paulcole 7y ago
  Your intuition is probably spot on. Dominos stock has been doing terribly and pizza delivery will likely cease to exist because it is a constant money loser.
  - askafriend 7y ago
    This is...not correct at all. Dominoes stock has been on an absolute tear the past decade. I don't know what charts you're looking at...
    - bduerst 7y ago
      They've plateaued this past year with negative growth. Is what dominoes was doing a decade ago really relevant?

wp381640 7y ago

Lookup the stock of Domino's[0] - they've been on a years long tear by scaling delivery and adopting tech In theory this could work better for some food delivery companies as they charge the restaurant rather than produce themselves and run the overhead of stores, etc. [0] http://www.google.com/finance?q=NYSE:DPZ http://www.google.com/finance?q=NYSE:DPZ

williamDafoe 7y ago
I think it's pretty obvious that nobody buys a Domino's Pizza because it tastes good! They buy it because someone shows up at your door and gives you food!
- mruts 7y ago
  I mean, they’re not terrible. I think I prefer them to other Pizza chains. And they have a dope app.

tallanvor 7y ago

Domino's and Little Caesars are the second and third largest pizza chains in the US. Some of them may have space for a few people to eat there, but their entire business structure is based on delivering pizzas. Sure, they have pick-up options as well, but I wouldn't say that changes them from being developed around the idea of delivering the pizzas.