6 ms·

Seems like a solid move, given the capture of the market by the food delivery apps, and their shady business practices (like the thread from a while ago where a

Seems like a solid move, given the capture of the market by the food delivery apps, and their shady business practices (like the thread from a while ago where a delivery service was making fake websites for restaurants, without their knowledge or consent). Why have this expire post COVID though?

mynameismonkey 6y ago
I believe this is a power granted by the state of emergency, when that ends, the power to mandate it ends. At that point they'd have to pursue other legislative avenues.
itsoktocry 6y ago
>Seems like a solid move Are any of these food delivery companies even making money? What will capping their fees do except make them lose even more?
- atonse 6y ago
  I'm just reading more that this business model was never going to work the way it is right now given the thin margins in restaurants and the cost of delivery drivers. With automation, it might change the economics. I think that's what everyone's betting on. I think the Ubers and all are just trying their damndest to not completely drown until driver automation reaches a certain stage. They obviously can't openly say that because there would be revolts from their drivers.
  - ghaff 6y ago
    >They obviously can't openly say that because there would be revolts from their drivers. Uber at least has been quite explicit about that. It's somewhere between delusional and what's known in the vernacular as "lying" but investors who are either naive or are cynically bought into the greater fool theory lap it up. Delivery specifically can work in dense areas but it mostly relies on local kids or family members working for peanuts and can't really pay for overpriced SV engineers or VC yachts.
- Nextgrid 6y ago
  Food delivery worked for decades when it was done by the restaurant itself so worst-case scenario we wouldn't lose much as these companies go bankrupt and we go back to restaurant-provided delivery. In fact, with all their tech and economies of scale, I'm surprised food delivery services are doing worse in terms of per-unit profitability than the low-tech restaurant-provided ones despite already charging excessive fees. I guess the reason is that the various venture capital firms poisoned their own well by subsidizing the services and competing at below-cost pricing.
  - paulgb 6y ago
    You're right, and that's why I'm genuinely confused by what's going on. Restaurant delivery used to be a healthy market that didn't need to eat up external capital. Now we have a situation where: - Restaurants say they are paying too much. - Delivery companies are losing money. - Customers are paying fees to the sites in addition to the delivery cost we used to pay. What gives? It seems these can't all be true.
    - marcinzm 6y ago
      In NYC I'm guessing most restaurants paid illegal immigrants in cash to deliver for them. Not sure about elsewhere. That lowers the cost a lot versus having a legitimate delivery business with legal workers and taxes.
    - belltaco 6y ago
      Add to that drivers complaining that they're getting exploited. But yes, all of those can be true. Paying someone for 30 to 45 minutes of their time is expensive.
      - paulgb 6y ago
        > Paying someone for 30 to 45 minutes of their time is expensive. Definitely, but this was also the case before Uber Eats et al.
        6y ago
- r0maia 6y ago
  Who should be losing money? The delivery apps or the restaurants?
  - cocoa19 6y ago
    Neither, a business that loses money is not a business.
spacephysics 6y ago
On paper it looks good, and given the players in the arena, there’s not much competition, especially since there’s a high bar of entry for new competition. Perhaps the idea behind not imposing such regulations is a free market argument, in which the most efficient price won’t be selected for, thereby not producing the optimal supply/demand. I would argue against this point that we would be assuming perfect competition, and given the anti competitive behavior of gig economy companies in this space (such as buying restaurant domain names, making fake websites with phone numbers they own to trick people into thinking they’re ordering directly) and lack of competition, this seems appropriate for now. Though the policy timeline should be extended, I don’t believe it should be indefinite. When the aforementioned issues are resolved, I’d agree with the free market side. In China, if I recall correctly, they have a food economy such that it’s cheaper to order take out, and have the food delivered, than actually cooking. We have inefficiencies In the infrastructure, less population density, and lack of competition that prevents us being in a similar boat.
- londons_explore 6y ago
  > In China, if I recall correctly, they have a food economy such that it’s cheaper to order take out, and have the food delivered, than actually cooking. Is this true? Here in London, a typical delivered meal would cost ~$20, whereas a weekly shop and cooking probably takes 5 hours/week, but costs only ~$2 per meal.
  - borkt 6y ago
    I believe so in some areas, but only because they are using kitchens/ingredients that cost less than restaurants or stores, IE located in bad areas, conditions/treatment worse for cooks, payment less for cooks, etc. Not something that should be supported but something that technology unfortunately makes possible and convenient
    - mantap 6y ago
      This is just reflective of inequality. I don't know about China specifically but in other asian countries that I know, most locals buy their ingredients at the market, and grocery stores target richer less price-conscious consumers. So it's certainly possible that the markup that the grocery store applies is greater than the cost of cooking and delivering the food, but that doesn't mean that it's cheaper than buying the ingredients at a market and cooking it yourself.
NovemberWhiskey 6y ago
... because we generally think the free market is a good idea?
JackFr 6y ago
> Why have this expire post COVID though? Because COVID has entirely transformed the economics of owning a restaurant. It might be worthwhile revisiting this in the future when eating in restaurants is available (and safe).

mynameismonkey 6y ago

I believe this is a power granted by the state of emergency, when that ends, the power to mandate it ends. At that point they'd have to pursue other legislative avenues.

itsoktocry 6y ago

>Seems like a solid move Are any of these food delivery companies even making money? What will capping their fees do except make them lose even more?

atonse 6y ago
I'm just reading more that this business model was never going to work the way it is right now given the thin margins in restaurants and the cost of delivery drivers. With automation, it might change the economics. I think that's what everyone's betting on. I think the Ubers and all are just trying their damndest to not completely drown until driver automation reaches a certain stage. They obviously can't openly say that because there would be revolts from their drivers.
- ghaff 6y ago
  >They obviously can't openly say that because there would be revolts from their drivers. Uber at least has been quite explicit about that. It's somewhere between delusional and what's known in the vernacular as "lying" but investors who are either naive or are cynically bought into the greater fool theory lap it up. Delivery specifically can work in dense areas but it mostly relies on local kids or family members working for peanuts and can't really pay for overpriced SV engineers or VC yachts.
Nextgrid 6y ago
Food delivery worked for decades when it was done by the restaurant itself so worst-case scenario we wouldn't lose much as these companies go bankrupt and we go back to restaurant-provided delivery. In fact, with all their tech and economies of scale, I'm surprised food delivery services are doing worse in terms of per-unit profitability than the low-tech restaurant-provided ones despite already charging excessive fees. I guess the reason is that the various venture capital firms poisoned their own well by subsidizing the services and competing at below-cost pricing.
- paulgb 6y ago
  You're right, and that's why I'm genuinely confused by what's going on. Restaurant delivery used to be a healthy market that didn't need to eat up external capital. Now we have a situation where: - Restaurants say they are paying too much. - Delivery companies are losing money. - Customers are paying fees to the sites in addition to the delivery cost we used to pay. What gives? It seems these can't all be true.
  - marcinzm 6y ago
    In NYC I'm guessing most restaurants paid illegal immigrants in cash to deliver for them. Not sure about elsewhere. That lowers the cost a lot versus having a legitimate delivery business with legal workers and taxes.
  - belltaco 6y ago
    Add to that drivers complaining that they're getting exploited. But yes, all of those can be true. Paying someone for 30 to 45 minutes of their time is expensive.
    - paulgb 6y ago
      > Paying someone for 30 to 45 minutes of their time is expensive. Definitely, but this was also the case before Uber Eats et al.
      - 6y ago
r0maia 6y ago
Who should be losing money? The delivery apps or the restaurants?
- cocoa19 6y ago
  Neither, a business that loses money is not a business.

spacephysics 6y ago

On paper it looks good, and given the players in the arena, there’s not much competition, especially since there’s a high bar of entry for new competition. Perhaps the idea behind not imposing such regulations is a free market argument, in which the most efficient price won’t be selected for, thereby not producing the optimal supply/demand. I would argue against this point that we would be assuming perfect competition, and given the anti competitive behavior of gig economy companies in this space (such as buying restaurant domain names, making fake websites with phone numbers they own to trick people into thinking they’re ordering directly) and lack of competition, this seems appropriate for now. Though the policy timeline should be extended, I don’t believe it should be indefinite. When the aforementioned issues are resolved, I’d agree with the free market side. In China, if I recall correctly, they have a food economy such that it’s cheaper to order take out, and have the food delivered, than actually cooking. We have inefficiencies In the infrastructure, less population density, and lack of competition that prevents us being in a similar boat.

londons_explore 6y ago
> In China, if I recall correctly, they have a food economy such that it’s cheaper to order take out, and have the food delivered, than actually cooking. Is this true? Here in London, a typical delivered meal would cost ~$20, whereas a weekly shop and cooking probably takes 5 hours/week, but costs only ~$2 per meal.
- borkt 6y ago
  I believe so in some areas, but only because they are using kitchens/ingredients that cost less than restaurants or stores, IE located in bad areas, conditions/treatment worse for cooks, payment less for cooks, etc. Not something that should be supported but something that technology unfortunately makes possible and convenient
  - mantap 6y ago
    This is just reflective of inequality. I don't know about China specifically but in other asian countries that I know, most locals buy their ingredients at the market, and grocery stores target richer less price-conscious consumers. So it's certainly possible that the markup that the grocery store applies is greater than the cost of cooking and delivering the food, but that doesn't mean that it's cheaper than buying the ingredients at a market and cooking it yourself.

NovemberWhiskey 6y ago

... because we generally think the free market is a good idea?

JackFr 6y ago

> Why have this expire post COVID though? Because COVID has entirely transformed the economics of owning a restaurant. It might be worthwhile revisiting this in the future when eating in restaurants is available (and safe).