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I would rather pay a higher delivery fee and (1) have enough workers to deliver my goods (2) Have them (and me) protected adequately. The whole way delivery wo

I would rather pay a higher delivery fee and (1) have enough workers to deliver my goods (2) Have them (and me) protected adequately. The whole way delivery works is broken right now.

jariel 7y ago
Me too, but neither you nor I represent the market. If there was a sufficient market for all of this to work out, it probably would have existed before Instacart. Instacart provides no innovation, other than dumping investor money on the market, and externalizing a lot of cost and risk onto gig workers, thereby making the price of delivery somewhat worthwhile ... for now. The moment the workers are paid reasonably and/or the VC subsidy runs out, what then? Since when do the unit metrics on this business add up?
- koolba 7y ago
  > Since when do the unit metrics on this business add up? Never. Without VC money or gig workers who do not understand the costs of depreciation this model does not work for something as low margin as groceries. At 10% margin, which is insane for groceries, you’d need a $100+ order to breaking even the cost of delivery. Forget actually making a profit. And real margins are closer to 2-3%.
  - nexuist 7y ago
    Over $100 is insane for groceries? We regularly spend that much for a family of three almost every weekend. Admittedly, we are in a high CoL area.
    - koolba 7y ago
      The 10% margins are what’d be insane. Not an individual bill of $100. At 2-3% the profits on that bill drop down to nowhere near enough to cover gas, mileage, health insurance, unemployment tax, and everything else tacked on for the true cost of delivery.
      - AnthonyMouse 7y ago
        > At 2-3% the profits on that bill drop down to nowhere near enough to cover gas, mileage, health insurance, unemployment tax, and everything else tacked on for the true cost of delivery. I don't understand how most of those things are "true costs" at all. This type of work is ideal for college students, who are typically still on their parents health insurance, or as supplementary work for someone who already has a full time job and wants to work a few extra hours. Unemployment doesn't even make sense in this context because you work whatever hours you want and they don't really do layoffs. Even if the company went out of business, there are several others offering the same type of work immediately to anyone. Gas costs money, but how much is highly dependent on vehicle type and people doing this type of work have the obvious incentive to use higher efficiency vehicles where the gas for this kind of trip would cost less than $1, and for the same reason to choose more reliable vehicles with below average maintenance costs. The way you get really gnarly cost estimates is by using the same depreciation models that corporations do when they buy new vehicles for the sole purpose of making deliveries -- because you then lose $10,000 or more in value over the first few years of ownership regardless of mileage or anything else you do. But for someone using a personal vehicle they would need regardless, that huge reduction in value due to age is already a sunk cost. And it is a bad deal for anyone who is trying to make a long-term career out of it, but the people expecting to do that should look elsewhere for employment. Not every job is a career, and why should it have to be? It is better for jobs with high flexibility and low compensation to exist for the people who want them. The people who need less flexibility and more compensation should choose different jobs.
        SturgeonsLaw 7y ago
        Well yeah, you can make the numbers square up if you ignore/offload a bunch of costs, but not everyone who is delivering for one of these companies is a student or has another income stream, and wear-and-tear on a vehicle will manifest as a mechanical fault one day. This argument sounds like a lot like the argument against raising minimum wage ("it's not meant to be enough to survive on"), however the reality is that large numbers of these gigs/jobs are worked by adults who depend on it as a primary source of income, and in the face of the massive and sudden job losses we're seeing, it's quite callous to say they should "just choose different jobs". If the Instacarts and Ubers of the world cannot afford to pay these people appropriately then their business model is a failure.
    - dheera 7y ago
      I rarely spend $100 in one go at the grocery store. During normal times I visit the grocery store about 4-7 times per week and only buy whatever I feel like having for the next day or two. There have been many times that I had everything else I needed and walked out with a single potato. It helps that I live 2 blocks from the grocery store, but I very much prioritize grocery store distance when choosing apartments. Of course, during these epidemic times I've flipped my habits around and buying 1-2 weeks worth at a time to minimize exposure, but that's not my normal way of buying groceries. I'm not usually good at predicting what my stomach feels like having 2 days later.
    - notduncansmith 7y ago
      I see you’re being downvoted, just wanted to add that our family of 3 also regularly spends over $100 weekly on groceries. We live in a fairly high cost-of-living area as well (Los Angeles, SF before that). A mix of prepared foods and raw ingredients, trying to source responsibly, for ~20 feedings adds up quickly.
      - dbuder 7y ago
        It's not about what median families spend weekly on groceries, it's about your average order value and that's $20-30 by my guess, maybe dragged up by some big orders but you'll find that people who order in bulk won't want to pay 10% and that most of your orders will be for near the minimum you set.
tedunangst 7y ago
Next up: InstaCart adds a $2 "safety" fee to every order, then pockets the money. Kinda like Uber added a $1 to every ride, but without actually spending the money on background checks, etc.
JumpCrisscross 7y ago
> I would rather pay a higher delivery fee In New York, we have Caviar [1][2], a mid-tier to premium food-delivery company. They differentiated based on premium food. I haven't heard any complaints from their delivery staff, though this may be on account of their size. Is there a premium player in the grocery delivery business? Something like FreshDirect, but with better service? [1] https://www.trycaviar.com https://www.trycaviar.com [2] https://en.wikipedia.org/wiki/Square,_Inc.#Caviar_restaurant_delivery_service https://en.wikipedia.org/wiki/Square,_Inc.#Caviar_restaurant...
- untog 7y ago
  > I haven't heard any complaints from their delivery staff, though this may be on account of their size. This is probably the key part. Does Caviar pay their drivers more than other sites? The cynic in me suggests that no, they don’t. Maybe, maybe, they get better tips as a result of delivering premium food.
  - faeyanpiraat 7y ago
    In my experience as a food courier, tipping amount do not correlate with the category of food delivered. You could get tipped more for a hamburger than a sushi. In fact the only correlation I've noticed is when the recipient seems like a decent person, combined with you having to go trough an extraordinary amount of trouble, like getting on a hill at the edge of the city, or having to navigate trough a confusing maze in a giant office complex. But then again sometimes you deliver in the night trough a thunderstorm an orbital amount of stuff for a party, and get nothing.
- adwi 7y ago
  In NYC the high-end restaurant supplier Baldor just started doing home deliveries for individuals... Prices aren’t great, think like high end Costco delivered. http://baldorfood.com/ http://baldorfood.com/
- tedmiston 7y ago
  > On August 1, 2019, it was announced that DoorDash will acquire the food delivery app Caviar from Square. That's interesting.

I would rather pay a higher delivery fee and (1) have enough workers to deliver my goods (2) Have them (and me) protected adequately. The whole way delivery works is broken right now.

jariel 7y ago

Me too, but neither you nor I represent the market. If there was a sufficient market for all of this to work out, it probably would have existed before Instacart. Instacart provides no innovation, other than dumping investor money on the market, and externalizing a lot of cost and risk onto gig workers, thereby making the price of delivery somewhat worthwhile ... for now. The moment the workers are paid reasonably and/or the VC subsidy runs out, what then? Since when do the unit metrics on this business add up?

koolba 7y ago
> Since when do the unit metrics on this business add up? Never. Without VC money or gig workers who do not understand the costs of depreciation this model does not work for something as low margin as groceries. At 10% margin, which is insane for groceries, you’d need a $100+ order to breaking even the cost of delivery. Forget actually making a profit. And real margins are closer to 2-3%.
- nexuist 7y ago
  Over $100 is insane for groceries? We regularly spend that much for a family of three almost every weekend. Admittedly, we are in a high CoL area.
  - koolba 7y ago
    The 10% margins are what’d be insane. Not an individual bill of $100. At 2-3% the profits on that bill drop down to nowhere near enough to cover gas, mileage, health insurance, unemployment tax, and everything else tacked on for the true cost of delivery.
    - AnthonyMouse 7y ago
      > At 2-3% the profits on that bill drop down to nowhere near enough to cover gas, mileage, health insurance, unemployment tax, and everything else tacked on for the true cost of delivery. I don't understand how most of those things are "true costs" at all. This type of work is ideal for college students, who are typically still on their parents health insurance, or as supplementary work for someone who already has a full time job and wants to work a few extra hours. Unemployment doesn't even make sense in this context because you work whatever hours you want and they don't really do layoffs. Even if the company went out of business, there are several others offering the same type of work immediately to anyone. Gas costs money, but how much is highly dependent on vehicle type and people doing this type of work have the obvious incentive to use higher efficiency vehicles where the gas for this kind of trip would cost less than $1, and for the same reason to choose more reliable vehicles with below average maintenance costs. The way you get really gnarly cost estimates is by using the same depreciation models that corporations do when they buy new vehicles for the sole purpose of making deliveries -- because you then lose $10,000 or more in value over the first few years of ownership regardless of mileage or anything else you do. But for someone using a personal vehicle they would need regardless, that huge reduction in value due to age is already a sunk cost. And it is a bad deal for anyone who is trying to make a long-term career out of it, but the people expecting to do that should look elsewhere for employment. Not every job is a career, and why should it have to be? It is better for jobs with high flexibility and low compensation to exist for the people who want them. The people who need less flexibility and more compensation should choose different jobs.
      - SturgeonsLaw 7y ago
        Well yeah, you can make the numbers square up if you ignore/offload a bunch of costs, but not everyone who is delivering for one of these companies is a student or has another income stream, and wear-and-tear on a vehicle will manifest as a mechanical fault one day. This argument sounds like a lot like the argument against raising minimum wage ("it's not meant to be enough to survive on"), however the reality is that large numbers of these gigs/jobs are worked by adults who depend on it as a primary source of income, and in the face of the massive and sudden job losses we're seeing, it's quite callous to say they should "just choose different jobs". If the Instacarts and Ubers of the world cannot afford to pay these people appropriately then their business model is a failure.
  - dheera 7y ago
    I rarely spend $100 in one go at the grocery store. During normal times I visit the grocery store about 4-7 times per week and only buy whatever I feel like having for the next day or two. There have been many times that I had everything else I needed and walked out with a single potato. It helps that I live 2 blocks from the grocery store, but I very much prioritize grocery store distance when choosing apartments. Of course, during these epidemic times I've flipped my habits around and buying 1-2 weeks worth at a time to minimize exposure, but that's not my normal way of buying groceries. I'm not usually good at predicting what my stomach feels like having 2 days later.
  - notduncansmith 7y ago
    I see you’re being downvoted, just wanted to add that our family of 3 also regularly spends over $100 weekly on groceries. We live in a fairly high cost-of-living area as well (Los Angeles, SF before that). A mix of prepared foods and raw ingredients, trying to source responsibly, for ~20 feedings adds up quickly.
    - dbuder 7y ago
      It's not about what median families spend weekly on groceries, it's about your average order value and that's $20-30 by my guess, maybe dragged up by some big orders but you'll find that people who order in bulk won't want to pay 10% and that most of your orders will be for near the minimum you set.

tedunangst 7y ago

Next up: InstaCart adds a $2 "safety" fee to every order, then pockets the money. Kinda like Uber added a $1 to every ride, but without actually spending the money on background checks, etc.

JumpCrisscross 7y ago

> I would rather pay a higher delivery fee In New York, we have Caviar [1][2], a mid-tier to premium food-delivery company. They differentiated based on premium food. I haven't heard any complaints from their delivery staff, though this may be on account of their size. Is there a premium player in the grocery delivery business? Something like FreshDirect, but with better service? [1] https://www.trycaviar.com https://www.trycaviar.com [2] https://en.wikipedia.org/wiki/Square,_Inc.#Caviar_restaurant_delivery_service https://en.wikipedia.org/wiki/Square,_Inc.#Caviar_restaurant...

untog 7y ago
> I haven't heard any complaints from their delivery staff, though this may be on account of their size. This is probably the key part. Does Caviar pay their drivers more than other sites? The cynic in me suggests that no, they don’t. Maybe, maybe, they get better tips as a result of delivering premium food.
- faeyanpiraat 7y ago
  In my experience as a food courier, tipping amount do not correlate with the category of food delivered. You could get tipped more for a hamburger than a sushi. In fact the only correlation I've noticed is when the recipient seems like a decent person, combined with you having to go trough an extraordinary amount of trouble, like getting on a hill at the edge of the city, or having to navigate trough a confusing maze in a giant office complex. But then again sometimes you deliver in the night trough a thunderstorm an orbital amount of stuff for a party, and get nothing.
adwi 7y ago
In NYC the high-end restaurant supplier Baldor just started doing home deliveries for individuals... Prices aren’t great, think like high end Costco delivered. http://baldorfood.com/ http://baldorfood.com/
tedmiston 7y ago
> On August 1, 2019, it was announced that DoorDash will acquire the food delivery app Caviar from Square. That's interesting.