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[ Disclaimer: GH employee but speaking independently & not representing the company in this message ] You're mixing up controversies - there was a separate "fe

[ Disclaimer: GH employee but speaking independently & not representing the company in this message ] You're mixing up controversies - there was a separate "feature" Grubhub did years ago where grubhub would stand up online presence for restaurants to bring in web search traffic (branded websites, search results on grubhub.com, etc) and list a grubhub phone number instead of the real phone number so that grubhub could collect comission on the orderflow that they're raking in for the restaurants. These were partnered restaurants, so they were signing up for this and could opt out of any of these services, in theory anyways I wasn't part of this so I have no idea if it's really that easy to opt out Separately, a practice pioneered by ubereats and doordash, "Place and Pay" is a new thing in the past 2-3 years where Grubhub will just list a bunch of restaurants without them asking for it ("non-partnered"), and when you place an order online the driver will go in and order takeout, then carry it to you. The restaurant can opt out of this, but they never asked for the service in the first place so it's kinda shitty. That's what this article is about. Grubhub was against place and pay at first, when UberEats and Doordash began doing it (not because Grubhub is selfless but because partnered restaurants are way more profitable), but resisting place and pay turned out to be a recipe for losing market share so that's no longer the case.

kop316 6y ago
"Grubhub was against place and pay at first, when UberEats and Doordash began doing it (not because Grubhub is selfless but because partnered restaurants are way more profitable), but resisting place and pay turned out to be a recipe for losing market share so that's no longer the case." If Grubhub actually took a stand and showed they not only did not do this sort of behavior, I would actually use it, and I would pay the premium for delivery (to make sure the restaurant makes money and the driver makes money). Instead, I never use your service, and I never plan to. I go out of my way to call a restaurant (and because of shady behavior like that, I take the extra time to make sure it is that restaurant and not some call center) and I will physically go to a restaurant because to pick up my order, so I know they are not losing money on orders.
- icebraining 6y ago
  I don't get it, how would the restaurant be losing money from this behaviour? Isn't Grubhub paying the regular takeout price, same as if you order it yourself?
  - ayewo 6y ago
    It's a bit more nuanced than that. The best way to think of food delivery businesses funded by VCs is to think of them as payday lenders. Some background reading: https://themargins.substack.com/p/doordash-and-pizza-arbitrage https://themargins.substack.com/p/doordash-and-pizza-arbitra... Be sure to also read this insightful comment left by a former GrubHub employee: https://themargins.substack.com/p/doordash-and-pizza-arbitrage/comments#comment-220885 https://themargins.substack.com/p/doordash-and-pizza-arbitra...
  - ghthrowaway99 6y ago
    At face value non-partnered restaurants dont lose money, they simply get more customers (essentially, getting some of the services that partnered restaurants get, but for free since partnered restaurants pay fees for each order that goes through the platform) However, in truth they pay damage in reputation. If the delivery company delivers food slow, or lets it get cold, then the customer will blame the restaurant. On top of that, unpartnered restaurants will naturally get slower delivery times because the order flow involves grubhub delivery people walking in and placing an order (or calling in), whereas partnered restaurants get point of sale systems integrated with grubhub's backend. They get less accurate delivery time estimations. They might pay a much higher delivery fee or service fee. All things add up to a worse customer experience.
    - an_opabinia 6y ago
      People order every day from non Amazon, non Amazon Prime sellers on Amazon. My feeling is end users know what they’re getting into as long as they’re informed the restaurant is non partnered, and your bosses just need to take the 5m to come up with a brand.
shadowgovt 6y ago
To a first approximation, I can't really see why Place and Pay should be illegal. It's basically paying the neighbor kid to go pick up some dinner for you, writ large. It "competes" with any delivery service a restaurant runs, but if the restaurant offers takeout at all, it's hard for me to see why the market should care who is doing the taking out.
- ggoo 6y ago
  There can be a big difference in time between the people who pickup food and bring it right back to their place and the GH employee who has it sitting in their car for 30 min before he gets to your place. This can make the experience worse and hence hurt the restaurants reputation.
  - shadowgovt 6y ago
    Perhaps there is a case to be made here around how reasonable person principle should be applied, because the defense can argue that only an idiot blames the company cooking the food when the independently-contracted delivery guy is too slow. If they can hinge a case on whether the reasonable person can tell the difference, there's meat on the bones, but I don't see this case ending with Grubhub's business model being declared illegal (only with clarifications as to how to maintain the reputation protection aspect of trademark against the nominative fair use aspect of trademark).
    - ggoo 6y ago
      No lawyer but demonstrating that "only an idiot blames the company cooking the food when the independently-contracted delivery guy is too slow" seems quite challenging, people leave reviews for all kinds of random, unrelated reasons. I would never make a bet on peoples inability to be idiots.
      - luckylion 6y ago
        Especially so when the independently contracted delivery guy impersonates the restaurant. A reasonable person will assume that the website restaurant-xyz.com connects them to the restaurant xyz and if they place an order, they are placing an order with that restaurant, not an independent contractor.
doc_gunthrop 6y ago
> The restaurant can opt out of this, but they never asked for the service in the first place so it's kinda shitty. That's what this article is about. If the driver places the order without making it clear to the restauranteur that they are the middleman company (UberEats, Doordash, etc.) then the opt-out clause is meaningless. You can't opt out of something you're never aware of.
- nogabebop23 6y ago
  yes - this is not "opt out", it's not even "default opt-in" like the telecoms got spanked for a few years ago, because they have no pre-existing relationship. It's fraudulent representation.
- ghthrowaway99 6y ago
  While I agree, restaurants do tend to pick up on this over time because (more issues with Place & Pay) people will complain to the restaurant about food being cold/slow not realizing that the restaurant isn't even involved in the delivery. Sometimes the delivery people make it quite obvious (e.g. drivers are given GH branded credit cards to pay with)
  - fbelzile 6y ago
    > restaurants do tend to pick up on this [fraud] over time Fixed that for you.
  - brlewis 6y ago
    > people will complain to the restaurant about food being cold/slow not realizing that the restaurant isn't even involved in the delivery By using their name in commerce, restaurants have a trademark. People complaining to the restaurant about delivery shows that consumers mistook the Place & Pay vendor for the restaurant. This is proof that the trademark was infringed. I don't see how Place & Pay could survive a court case, or even prolong one.
balls187 6y ago
I do appreciate your candor, however it is clear that GH engages in "kinda shitty" business practices.
codysan 6y ago
FWIW, Postmates has been doing these "Place & Pay" orders since ~2012. A courier for Postmates was more akin to someone taking orders from an app like Favor/TaskRabbit than a purpose-built restaurant delivery service.
jberryman 6y ago
> The restaurant can opt out of this I was at the bar of a local restaurant when some delivery driver (not sure if GH) came in to pick up an order. The (super busy) server said "we told you we don't want to participate in this...", clearly exasperated at this happening over and over. This is a restaurant that does a lot of catering, where they set the terms/fees. The driver started trying to "explain" how it's just the same as if he were a real customer and how would she know, etc. It was just gross. This was a couple years ago.
- jjk166 6y ago
  I get that the restaurant owner was frustrated but this is like giving your waiter a bad tip because your food didn't taste good - you really think the driver has any influence on which restaurants get listed?
  - kevincox 6y ago
    No, but if you manage to identify all of these delivery people and refuse them service I bet that they unlist you.
    - jjk166 6y ago
      That's a fairly unreasonable assumption. Odds are the only thing a human at corporate will ever see is "Driver John Doe could not complete delivery, customer complained" Unless purely by chance the same person just so happens to see the same issue with the same restaurant a few times, it's very unlikely that they'ed notice a trend, nonetheless correctly deduce its cause. The person in charge of making sure deliveries get completed is almost certainly not the person handling restaurant partnerships. Even if someone does eventually notice and takes corrective action, this is far from an optimal way to do it. Given that the server is acting like the drivers should just know that they wanted to be unlisted, it wouldn't surprise me if the "we told you before" means all they did was tell drivers they wanted to opt out and never actually did the opt out procedure.
      - 6y ago
itronitron 6y ago
reminds me of the pizza arbitrage article and discussion from a few months ago... https://news.ycombinator.com/item?id=23216852 https://news.ycombinator.com/item?id=23216852 https://themargins.substack.com/p/doordash-and-pizza-arbitrage https://themargins.substack.com/p/doordash-and-pizza-arbitra...
sida 6y ago
why is DD not getting sued? Why is grubhub the one getting sued?
mring33621 6y ago
I think it shows courage for a non-PR employee to participate in a conversation like this. Thank you!

kop316 6y ago

"Grubhub was against place and pay at first, when UberEats and Doordash began doing it (not because Grubhub is selfless but because partnered restaurants are way more profitable), but resisting place and pay turned out to be a recipe for losing market share so that's no longer the case." If Grubhub actually took a stand and showed they not only did not do this sort of behavior, I would actually use it, and I would pay the premium for delivery (to make sure the restaurant makes money and the driver makes money). Instead, I never use your service, and I never plan to. I go out of my way to call a restaurant (and because of shady behavior like that, I take the extra time to make sure it is that restaurant and not some call center) and I will physically go to a restaurant because to pick up my order, so I know they are not losing money on orders.

icebraining 6y ago
I don't get it, how would the restaurant be losing money from this behaviour? Isn't Grubhub paying the regular takeout price, same as if you order it yourself?
- ayewo 6y ago
  It's a bit more nuanced than that. The best way to think of food delivery businesses funded by VCs is to think of them as payday lenders. Some background reading: https://themargins.substack.com/p/doordash-and-pizza-arbitrage https://themargins.substack.com/p/doordash-and-pizza-arbitra... Be sure to also read this insightful comment left by a former GrubHub employee: https://themargins.substack.com/p/doordash-and-pizza-arbitrage/comments#comment-220885 https://themargins.substack.com/p/doordash-and-pizza-arbitra...
- ghthrowaway99 6y ago
  At face value non-partnered restaurants dont lose money, they simply get more customers (essentially, getting some of the services that partnered restaurants get, but for free since partnered restaurants pay fees for each order that goes through the platform) However, in truth they pay damage in reputation. If the delivery company delivers food slow, or lets it get cold, then the customer will blame the restaurant. On top of that, unpartnered restaurants will naturally get slower delivery times because the order flow involves grubhub delivery people walking in and placing an order (or calling in), whereas partnered restaurants get point of sale systems integrated with grubhub's backend. They get less accurate delivery time estimations. They might pay a much higher delivery fee or service fee. All things add up to a worse customer experience.
  - an_opabinia 6y ago
    People order every day from non Amazon, non Amazon Prime sellers on Amazon. My feeling is end users know what they’re getting into as long as they’re informed the restaurant is non partnered, and your bosses just need to take the 5m to come up with a brand.

shadowgovt 6y ago

To a first approximation, I can't really see why Place and Pay should be illegal. It's basically paying the neighbor kid to go pick up some dinner for you, writ large. It "competes" with any delivery service a restaurant runs, but if the restaurant offers takeout at all, it's hard for me to see why the market should care who is doing the taking out.

ggoo 6y ago
There can be a big difference in time between the people who pickup food and bring it right back to their place and the GH employee who has it sitting in their car for 30 min before he gets to your place. This can make the experience worse and hence hurt the restaurants reputation.
- shadowgovt 6y ago
  Perhaps there is a case to be made here around how reasonable person principle should be applied, because the defense can argue that only an idiot blames the company cooking the food when the independently-contracted delivery guy is too slow. If they can hinge a case on whether the reasonable person can tell the difference, there's meat on the bones, but I don't see this case ending with Grubhub's business model being declared illegal (only with clarifications as to how to maintain the reputation protection aspect of trademark against the nominative fair use aspect of trademark).
  - ggoo 6y ago
    No lawyer but demonstrating that "only an idiot blames the company cooking the food when the independently-contracted delivery guy is too slow" seems quite challenging, people leave reviews for all kinds of random, unrelated reasons. I would never make a bet on peoples inability to be idiots.
    - luckylion 6y ago
      Especially so when the independently contracted delivery guy impersonates the restaurant. A reasonable person will assume that the website restaurant-xyz.com connects them to the restaurant xyz and if they place an order, they are placing an order with that restaurant, not an independent contractor.

doc_gunthrop 6y ago

> The restaurant can opt out of this, but they never asked for the service in the first place so it's kinda shitty. That's what this article is about. If the driver places the order without making it clear to the restauranteur that they are the middleman company (UberEats, Doordash, etc.) then the opt-out clause is meaningless. You can't opt out of something you're never aware of.

nogabebop23 6y ago
yes - this is not "opt out", it's not even "default opt-in" like the telecoms got spanked for a few years ago, because they have no pre-existing relationship. It's fraudulent representation.
ghthrowaway99 6y ago
While I agree, restaurants do tend to pick up on this over time because (more issues with Place & Pay) people will complain to the restaurant about food being cold/slow not realizing that the restaurant isn't even involved in the delivery. Sometimes the delivery people make it quite obvious (e.g. drivers are given GH branded credit cards to pay with)
- fbelzile 6y ago
  > restaurants do tend to pick up on this [fraud] over time Fixed that for you.
- brlewis 6y ago
  > people will complain to the restaurant about food being cold/slow not realizing that the restaurant isn't even involved in the delivery By using their name in commerce, restaurants have a trademark. People complaining to the restaurant about delivery shows that consumers mistook the Place & Pay vendor for the restaurant. This is proof that the trademark was infringed. I don't see how Place & Pay could survive a court case, or even prolong one.

balls187 6y ago

I do appreciate your candor, however it is clear that GH engages in "kinda shitty" business practices.

codysan 6y ago

FWIW, Postmates has been doing these "Place & Pay" orders since ~2012. A courier for Postmates was more akin to someone taking orders from an app like Favor/TaskRabbit than a purpose-built restaurant delivery service.

jberryman 6y ago

> The restaurant can opt out of this I was at the bar of a local restaurant when some delivery driver (not sure if GH) came in to pick up an order. The (super busy) server said "we told you we don't want to participate in this...", clearly exasperated at this happening over and over. This is a restaurant that does a lot of catering, where they set the terms/fees. The driver started trying to "explain" how it's just the same as if he were a real customer and how would she know, etc. It was just gross. This was a couple years ago.

jjk166 6y ago
I get that the restaurant owner was frustrated but this is like giving your waiter a bad tip because your food didn't taste good - you really think the driver has any influence on which restaurants get listed?
- kevincox 6y ago
  No, but if you manage to identify all of these delivery people and refuse them service I bet that they unlist you.
  - jjk166 6y ago
    That's a fairly unreasonable assumption. Odds are the only thing a human at corporate will ever see is "Driver John Doe could not complete delivery, customer complained" Unless purely by chance the same person just so happens to see the same issue with the same restaurant a few times, it's very unlikely that they'ed notice a trend, nonetheless correctly deduce its cause. The person in charge of making sure deliveries get completed is almost certainly not the person handling restaurant partnerships. Even if someone does eventually notice and takes corrective action, this is far from an optimal way to do it. Given that the server is acting like the drivers should just know that they wanted to be unlisted, it wouldn't surprise me if the "we told you before" means all they did was tell drivers they wanted to opt out and never actually did the opt out procedure.
    - 6y ago

itronitron 6y ago

reminds me of the pizza arbitrage article and discussion from a few months ago... https://news.ycombinator.com/item?id=23216852 https://news.ycombinator.com/item?id=23216852 https://themargins.substack.com/p/doordash-and-pizza-arbitrage https://themargins.substack.com/p/doordash-and-pizza-arbitra...

sida 6y ago

why is DD not getting sued? Why is grubhub the one getting sued?

mring33621 6y ago

I think it shows courage for a non-PR employee to participate in a conversation like this. Thank you!