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> Food delivery... works great "inhouse". but > Plus they also want to take 30-50% commission for the privilege. If food delivery works great in house then w

> Food delivery... works great "inhouse". but > Plus they also want to take 30-50% commission for the privilege. If food delivery works great in house then why do restaurants pay Uber so much? I'd wager employing drivers is impractical for a lot of restaurants.

martinald 4y ago
Well, McDonalds was a crazy amount of UberEats business. I heard as much as 50% of it. McDonalds is now in the UK offering their own inhouse delivery service. Clearly they've let Uber do all the hard work proving it works and now want that commission back.
- cameronh90 4y ago
  At least in my area, McDelivery is provided by Uber Eats. All this seems to mean in practice is I get a crappy Uber Eats delivery but have to order it through the McDonalds app, which is somehow even worse than Uber Eats. I've just looked at the McDonalds app, and it says my local McDonalds is 24/7 and lets me order to collect from there. I know for a fact that it's shut right now, and the official store locator also says it's shut. I stick to Deliveroo and Just Eat where possible because their apps and service tend to be pretty decent.
wyre 4y ago
“All of your competitors pay us 30% so they can order food from their iPhone, pay us the same amount so they won’t take your customers away” Doordash would offer a restaurant before partnering with them by calling in the orders so they could have sales numbers to pitch to the restaurant owner when they want to take the 30%.
kareemsabri 4y ago
It doesn't work great in house. It works great with economies of scale. I don't know the history of pizza delivery, so this is speculation, but I imagine that pizzas travel well, and people became accustomed to ordering them for delivery. So a driver can load up on pizzas, make a whole bunch of deliveries (and people are generally satisfied with the quality), rinse, and repeat. That's economical. Delivering a handful of orders at a time (maybe even 1) is obviously a terrible value proposition. But if it's incremental revenue, and covers your cost of goods sold, you may as well let Uber lose money to do it.
jbay808 4y ago
In the '90s when you wanted to order delivery, you'd open a phone book and pick a restaurant. Some would pay extra for a big, extra-visible listing in that phone book. Uber, Doordash, etc get away with charging such premiums not because delivery is so costly but because they've made themselves into a new phone book. Hungry customers open the app to look for a restaurant, and the restaurant wants to be listed there. However that's not really a win for the restaurant. It might not increase their business, just stop them from losing it. If the app didn't exist at all, those customers would find them another, less convenient way. But because the app exists, the customers stopped using those ways.
- cheriot 4y ago
  That's a good point. Once DoorDash hits critical mass, I agree it's as much a shopping app as delivery service. I also think that early in a market they benefit from making delivery possible for restaurants that otherwise wouldn't have it.

martinald 4y ago

Well, McDonalds was a crazy amount of UberEats business. I heard as much as 50% of it. McDonalds is now in the UK offering their own inhouse delivery service. Clearly they've let Uber do all the hard work proving it works and now want that commission back.

cameronh90 4y ago
At least in my area, McDelivery is provided by Uber Eats. All this seems to mean in practice is I get a crappy Uber Eats delivery but have to order it through the McDonalds app, which is somehow even worse than Uber Eats. I've just looked at the McDonalds app, and it says my local McDonalds is 24/7 and lets me order to collect from there. I know for a fact that it's shut right now, and the official store locator also says it's shut. I stick to Deliveroo and Just Eat where possible because their apps and service tend to be pretty decent.

wyre 4y ago

“All of your competitors pay us 30% so they can order food from their iPhone, pay us the same amount so they won’t take your customers away” Doordash would offer a restaurant before partnering with them by calling in the orders so they could have sales numbers to pitch to the restaurant owner when they want to take the 30%.

kareemsabri 4y ago

It doesn't work great in house. It works great with economies of scale. I don't know the history of pizza delivery, so this is speculation, but I imagine that pizzas travel well, and people became accustomed to ordering them for delivery. So a driver can load up on pizzas, make a whole bunch of deliveries (and people are generally satisfied with the quality), rinse, and repeat. That's economical. Delivering a handful of orders at a time (maybe even 1) is obviously a terrible value proposition. But if it's incremental revenue, and covers your cost of goods sold, you may as well let Uber lose money to do it.

jbay808 4y ago

In the '90s when you wanted to order delivery, you'd open a phone book and pick a restaurant. Some would pay extra for a big, extra-visible listing in that phone book. Uber, Doordash, etc get away with charging such premiums not because delivery is so costly but because they've made themselves into a new phone book. Hungry customers open the app to look for a restaurant, and the restaurant wants to be listed there. However that's not really a win for the restaurant. It might not increase their business, just stop them from losing it. If the app didn't exist at all, those customers would find them another, less convenient way. But because the app exists, the customers stopped using those ways.

cheriot 4y ago
That's a good point. Once DoorDash hits critical mass, I agree it's as much a shopping app as delivery service. I also think that early in a market they benefit from making delivery possible for restaurants that otherwise wouldn't have it.