19 ms·

Five companies now control over 90% of the restaurant food delivery market

294 points by goinggetthem 1y ago

tptacek 1y ago
I would care a lot more if this market had even existed as recently as 15 years ago, but most of what this article is making a case for is that the next 5 years in this space are almost completely unpredictable.
- mattmaroon 1y ago
  And the alternative to restaurant delivery service is really the way we get the other 98% of our food. Anything I can ignore without being at some sort of disadvantage I don’t really get worked up about consolidation. I wish we had more than 3 cell phone networks, this could all be one and I’ll just drive to the restaurant.
  - tptacek 1y ago
    There was a discourse prior to the last election about how cost of living was out of control based on people sharing delivery bills from their "burrito taxi". I do get that this article isn't "about" that discourse, it's about an investment thesis, but my real point is just: there is no reason to believe any part of this market has settled to the point where you could make reliable predictions. Everything is very new.
    - mattmaroon 1y ago
      Yeah I remember Jeff Bezos saying something very much like that at the launch of the kindle phone. Something like “smart phones have only been around for seven years there’s no reason to think the two platforms in the lead now will always be the only two.” Sometimes a market has already ossified five years in. I guess we’ll see.
- deleted 1y ago
  [deleted]
- morsch 1y ago
  I don't understand, are you saying the market was so small that it might as well not have existed? I don't have the impression that it's gotten magnitudes bigger here in Germany, maybe in China it did (what hasn't), in the US...? People just use the web instead of using a phone. AT&T didn't charge a commission.
  - tpmoney 1y ago
    Realistically in the US before the various online delivery companies figured out how to make it work, most places just didn't do delivery at all. Traditionally pizza places and Chinese food were something you could order delivered. Almost everything else was either drive through or take-out.
    - asdff 1y ago
      What is sort of crazy is that these delivery services didn't even supplant pizza delivery. All the major chain pizza delivery places and most of the local spots all still run their own delivery service long into this app era. It kind of makes sense. App delivery is notorious for being pretty terrible service quality and having the food end up worse with more time spent between kitchen and you eating it. Pizza delivery on the other hand has been seen as quick with drivers interested in earning their tip, pizza places being conservative with delivery radius to not overextend their drivers, etc. Customers don't like getting an inferior product or service one day.
      - to11mtm 1y ago
        > App delivery is notorious for being pretty terrible service quality and having the food end up worse with more time spent between kitchen and you eating it. Pizza delivery on the other hand has been seen as quick with drivers interested in earning their tip, pizza places being conservative with delivery radius to not overextend their drivers, etc. Customers don't like getting an inferior product or service one day. Additionally, at least in my experience it's pretty easy to get to where just paying the delivery fee of a pizza place is cheaper than paying for inflated per-item rates.
  - 1y ago
ro_bit 1y ago
The title scared me a bit before I opened the article and realized it was talking about restaurant->consumer food delivery services. While that isn't great, I was initially thinking was that the companies that facilitate the food delivery supply chains around the world were massively consolidated (I sure hope they aren't)
- Tostino 1y ago
  I built one of the trade promotion management (TPM) tools used in that space and had to deal with these companies daily for the last decade. There are absolutely a bunch of acquisitions/ consolidation in that food distribution space, but there are still hundreds of different distributors just in the US. However, most volume does flow through the largest distributors. For example, I had to build a specific feature to merge distributors after an acquisition happens in the industry, to make the product work properly because that's such a common occurrence. Had the same type of feature for manufacturers (my customers) also, because they kept buying each other.
  - ro_bit 1y ago
    Thanks for your response! I love this forum for how many experts chime in in the comments section
- ks2048 1y ago
  I'm pretty sure the food supply sources are massively consolidated. I don't know about the delivery part or why that would matter more than the actual food production. A quick search will lead to quotes like "Four companies now control more than half of the market in chicken processing (Tyson, JBS, Perdue, and Sanderson), close to 70 percent in pork (Smithfield, JBS, Tyson, and Hormel), and nearly three quarters in beef (JBS, Tyson, Cargill, and National Beef)"
  - khurs 1y ago
    Margins on food staples like Chicken are very low, which suggests that consolidation is inevitable. Supermarket margins are also very low.
closewith 1y ago
> total food delivery market worldwide This is the article's claim, but I'm fairly certain it's of the food delivery aggregator market. There's still plenty of independents.
- flymasterv 1y ago
  Yeah, there’s no way Domino’s doesn’t appear on that chart.
mrweasel 1y ago
One of those companies are available where I live, and I'll never use them, because they make my pick ups insufferable. I have kids, and can see McDonalds from my bedroom window, so I have more McDonalds points than I care to admit. Wolt is pissing me off every time. The amount of time the McDonalds staff needs to dedicate to Wolt staff is insane. They could easily serve twice the customer in resturante/drive-through if they didn't have to help a borderline incompetent Wolt staffer on a moped. It's actually rude to priorities deliveries over in restaurant customers. For that alone I will never use Wolt. Fortunately every single good pizza place nearby have their own drivers, who are actually polite and competent.
- blibble 1y ago
  I don't see the attraction of these apps either the food arrives lukewarm, in a smaller portions and costs more in addition their widespread use hurts the restaurants you like and drives down wages for society, because the only people who can live on what they pay out to the drivers are illegal immigrants paying zero tax (with the state paying for room and board) it's all negatives
- bowsamic 1y ago
  I’ve had this experience specifically with Wolt in Germany: sat in a busy restaurant with sit in diners waiting 2 hours for their meals while the kitchen seemed to be catering for a constant stream of Wolt drivers. And the real kicker is that of course since this is Germany all the negative reviews have been sued away, including my wife’s very moderate 3 star review. Of course German restaurants will claim it is libel if you write that you had to wait for your food
salomonk_mur 1y ago
Rappi is missing. It's huge in all of Latin America.
- neoecos 1y ago
  You're absolutely right, I'm guessing the GMV of rappi should appear on the graph. My guess is about 3-5B.
hn_throwaway_99 1y ago
This is essentially the story of tech companies across nearly every industry where they have come to dominate. This is one reason that I see most tech companies as essentially a net negative for society at large, as the goal is nearly always to control a large monopoly (and this is fully admitted by many tech leaders, e.g. Thiel) which the Internet makes possible. Pre-Internet you would see the same dynamics, but usually on a much smaller regional scale. I think that many of the growing problems in society today are fundamentally attributable to the extreme concentration of wealth and power that modern tech enables.
- JumpCrisscross 1y ago
  It’s the story of most mature industries. Food delivery also remains cutthroat enough that this is a strange place to launch this complaint from.
  - sroussey 1y ago
    It is also weird that there isn't a company with 2/3 of the market. Eventually it will happen i guess.
    - TylerE 1y ago
      Sysco is probably pretty close if you ignore the extremes of the market.
      - drivingmenuts 1y ago
        While Sysco is a monopoly, they apparently don't make anyone angry enough to get rid of them. My guess is that they are pretty even-handed across an entire industry and their customers are knowledgeable enough to not screw up a good thing when they see it.
        Karrot_Kream 1y ago
        No I think tech just gets obsessive media coverage these days (both from MSM and from influencers.) I know lots of event companies that hate Sysco, it just doesn't get as many clicks as a tech company does.
Reason077 1y ago
Less competition would certainly be bad for consumers and drivers. But has that actually happened here? Doordash and Deliveroo do not operate in the same markets, so their merger would not reduce competition in any given market. Prosus is a big conglomerate with its fingers in many different industries. But unless it starts buying multiple delivery companies that operate in the same markets, its acquisition of Just Eat also doesn’t appear to be reducing competition.
- asdff 1y ago
  I think tech companies that are in sectors like this with a great deal of money moving around a few different entities tend to inadvertently operate as de facto cartels in a lot of ways. They tend to mirror business decisions due to poaching eachother for the same talent and consulting with the same agencies who are giving them the same information and findings. The way they set up their companies and operate is all pretty much the same and designed to be similar so as to be useful for investors looking to compare businesses in the sector. ux patterns are the same or similar enough. How they pay their drivers also the same or similar enough. When there is this much similarity of behavior in the sector one has to ask if there would even be a difference for the consumer between having all delivery under 1 company or 10000 companies all operating the same business model? No different than a small town restaurant scene lost to 15 different chain fast food restaurants all operating the same franchise model: customers have diversity of business on paper, but not really since it is all just more or less the same sort of business with marginally different offerings.
andybak 1y ago
I still tend to discover a takeaway or restaurant and then figure out how to get them to deliver. I've never not ordered from somewhere I was keen on based on their choice of delivery service. If the consolidation results in price hikes and poor service, what's the lock-in? Why can't the takeaways just go rogue and offer independent deliveries?
- spacephysics 1y ago
  Lots of their infrastructure for handling orders (iPads, software integration into their payment system) was done around Covid, and some have started to integrate in-person orders through the same “single unified system” creating a higher and higher cost to switch delivery systems. AFAIK there’s no well-supported open source order/delivery management software. The companies that were ready during covid took all the extra, enormous demand for building delivery and order online systems built atop a typically antiquated order management system and have stuck around since Sometimes i’ll get a cheaper delivery/food cost calling vs ordering online, but now some places are just raising their other prices to match online
  - b112 1y ago
    And yet, why do you need software? In the 80s, I delivered pizza with no software. The place had a normal cash register, for pickups. People would call, order, and we'd write it down. They it'd go on a wire with a clothes pin, until made. Then it went with the driver. Each delivery was written down before leaving with it. This worked for decades for everyone in the industry, flawlessly, perfectly, without issue. Why is software required? Any given reasons are an unneccessary complication. And here's the thing. Even in Palo Alto I order from companies still doing it this way. The above system, paperwork wise .. again, is perfect. It's been done forever. It is faster and far less expensive than any unified payment and order system. Seems to me, they're the smart ones.
    - asdf6969 1y ago
      Everyone hates calling and apps give customers a list of restaurants with menus to browse. Restaurants also do all of their in-restaurant management with software (why not paper? ask them idk) which I assume has some integration with the app. I can imagine some type of open protocol that lets them self-host an order service though, or at least an open solution that’s hosted by many providers and many separate apps. That would be nice for everyone
thisisit 1y ago
I think this will be even more consolidated in the future. Or mostly duopoly in many markets. Food delivery is capital intensive. It is unlikely that new players enter the market.
daedrdev 1y ago
I think the truth is restaurant food delivery is a luxgury good, literally “private taxi for your burrito” yet many people spend like it isnt.
- to11mtm 1y ago
  Restaurant delivery... I tend to agree. 'nonperishable food' or 'properly packed short travel' (i.e. dairy/frozen) IMO is a fairer niche of 'could be non-luxury with better societal outcomes', except for the 'as close to JIT as possible'. There's ways to optimize the process to where something on the scale of 10-20 homes could get their main groceries delivered two or 3 times a week and the overall cost would be lower than all of them doing so. Yeah you'd need a reefer van or an otherwise replenishable source of cold for dairy/frozen but at that scale the cost of such makes a lot more sense. Biggest problem is getting the right buy-in and mindset from consumers.
  - watwut 1y ago
    Difference is you can stock large quantity of frozen foods any time it is convenient to shop. As in, frozen food delivery is not all that useful. When you work from home and cant cook, delivery can happen right now. Or if you are having a small gathering with friends, delivery makes your life easier exactly when you need it.
  - mtrovo 1y ago
    I totally agree in theory, in the same way I agree that Amazon delivering everything from a nearby warehouse is far more optimal than having thousands of small bookshops or random shops in prime locations. I think that's the main vision behind Travis Kalanick's CloudKitchens since he left Uber. You could order food prep for your week from a choice of menus, and the food would be prepared in an industrial kitchen for you and thousands of other people around you. It's basically restaurant-quality food that you can eat at home and isn't frozen. Unfortunately for the meal prep market, I believe the break-even point for scale is much more difficult to achieve. Food is like hardware but with a much shorter end-of-life. You would need consistency in ordering to avoid excess spoilage and to operate at scale within small geographical pockets to make the delivery worthwhile. I really believe this could work with the right demographics and in the right geography, it's just much harder than simply delivering takeaways.
esco27 1y ago
The food industry is due for a good old opensource disruption, where each restaurant can setup their private menu hub (like you would an instagram account), add their payment processing details, and start delivering their own orders. It's a win-win for the restaurant and their recurring customers.
- redleader55 1y ago
  What about users? Will they install one app for each restaurant they order from on their phone or will they prefer to do everything in the same app?
  - nickjj 1y ago
    There are middle man services for certain types of food in certain areas. For example Slice is a popular one for pizza. I know a business owner who uses it. They have an app and optionally an online menu on your custom domain to take online orders and physical hardware for taking orders in your store. Think POS system, register, terminal, printers, etc.. For a business owner that covers you for accepting online and offline orders, and you can deliver direct to your customers. 95% of his online delivery orders go through this system because DoorDash charges him (the business owner) 30% for each order so he raised his prices there to partially offset that. Slice on the other hand is 5% cheaper than his baseline price for online orders for customers so it's a no brainer most use that. With that said, way more people call in or come in person than using the app. Probably a 90% / 10% split.
  - carlosjobim 1y ago
    There's no need for apps to make online orders.
- Reason077 1y ago
  These certainly exist. My local favourite Thai restaurant has its own ordering website and has its own staff deliver the order, with no markup over the in-restaurant menu prices. The company that operates their ordering platform is mobihq.com (I have no affiliation with them)
- 1y ago
Neywiny 1y ago
I think 5 is a good number based on no data or experience. Feels like enough where you could reasonably tell one to pound sand if they start getting too greedy, while not being forced to just take the other 1.
faizshah 1y ago
Meanwhile I have seen a lot of local restaurants advertising how ordering through their own delivery/pickup service can be 30% less than Uber Eats or DoorDash on their takeout boxes (and consequently in your uber/doordash order). It’s interesting that some of the POS companies are getting into the market: https://www.toasttab.com/local https://www.toasttab.com/local There’s huge room for disruption in this model when a $12 chipotle order costs the consumer $30 after higher menu prices + delivery fees + tip.
- Workaccount2 1y ago
  When I worked at a restaurant that did Ubereats/door dash/GrubHub, we had a 15% upcharge on order through those platforms. We would tell repeat customers they could use our website/app/phone to order directly and save the 15%. Almost no one converted. Convenience really is king.
  - faizshah 1y ago
    So what this POS company is doing that’s kind of interesting is they have a mobile app just like Uber Eats/Doordash but it seems to be direct through the restaurant: https://apps.apple.com/us/app/local-by-toast/id1362180579 https://apps.apple.com/us/app/local-by-toast/id1362180579 Actually when I ordered through it I paid $45 instead of $60 via DoorDash/Uber Eats but the order was delivered by Uber. The reason why I think this version will work is because it’s the same level of convenience in a centralized mobile app so single payment method, single portal to browse restaurants etc. (I have no association with this company I just was looking into this last week on the train)
  - carlosjobim 1y ago
    Win-win then, since you made the upcharge.
TheMagicHorsey 1y ago
I know these are three sided marketplaces and difficult to coordinate demand and supply ... but why isn't there more locally hosted town and city level options that undercut the national/international conglomerates? Food delivery is ultimately a local thing.
Aeolun 1y ago
Two companies now control 90% of the phone market. I think the restaurant food delivery market is quite healthy.
- khurs 1y ago
  Do you mean the App Stores rather than the phone market? That is soon to be 3, as Harmony OS takes hold in China and other markets.
  - immibis 1y ago
    I thought Harmony was a banned word in China. It's what the government called its own totalitarianism, then it's what the people called the government's totalitarianism, then the government banned it because they don't want people to talk about the totalitarianism.
bawolff 1y ago
5 companies dominate a market that 5-10 years ago didn't even exist. That doesn't exactly sound terrible.
- afavour 1y ago
  Of course it did. People have been ordering delivery food for decades. They just called up the restaurant to do it.
  - bawolff 1y ago
    I dont know where you live, but that was absolutely not true where i lived. The only exception was chinese and pizza. Nobody else offered delivery. The current delivery market is much more than that.
throwpoaster 1y ago
Sounds like a fairly normal market structure.
deleted 1y ago
[deleted]
v5v3 1y ago
My understanding is that the drivers are non-exclusive and can work for multiple companies at the same time. So as their is a ready supply of drivers, anyone who can raise an amount of money, and find a niche can enter the fray? The suppliers (restaurants) are not happy with 30% or so being taken by the giants.
kurofune 1y ago
Is this surprising? This is what our actual economic system is all about: a series of market oligopolies whose greed is unchecked by our political establishment and legal apparatus with the complicity of the voting masses. Any attempt to implement measures to palliate the social decay and corruption it breeds will be branded as chinese communism and opposed by the media and the public. We have collectively decided that the economy shouldn't be in service of the people, canis canem edit.
gonzo41 1y ago
Regardless of market position, are food delivery companies actually making money at the moment?
paxys 1y ago
I can't think of a single industry or segment, whether consumer or enterprise, where 90%+ of the market isn't controlled by 1-5 companies. That's just how business works.
- readthenotes1 1y ago
  Chinese food restaurant? Lawn service If I spent more than 2 seconds I could probably think of others
- diatone 1y ago
  Schooling
thaumasiotes 1y ago
This post doesn't appear to present any evidence that five companies control any significant share of the food delivery market. It looks at transaction volume of major deliverers, comparing them to each other. But it's not at all clear that major deliverers are even a majority of the delivery market. There are no pizza chains on the list. There are certainly no individual restaurants on the list. > Why is my $8 burger $23 after fees - An average reddit user Delivery in China (through Alipay, which may or may not be backed by Meituan) is generally cheaper after fees than it would be if you just went and bought the food in person. This might explain why Meituan has so much more transaction value than Doordash and Uber Eats. But it's not something I'd imagine drives a lot of user complaints.
mupuff1234 1y ago
I honestly just can't comprehend how people so easily just throw away money on these apps - The fees are ridiculous on top of already expensive restaurant prices.
bravesoul2 1y ago
> As long as food delivery is better than other ways of consuming food, like cooking, takeaways, or dining out, it will be able to keep customers in the network. Made me laugh out loud. It's strictly the worst option. Only use it if my job wants to pay, or if very sick. Cold food. Unpredictable delivery times. More expensive than eating out. Usually less nutritious than cooking yourself. And of course expensive as hell.
protocolture 1y ago
It continues to be crazy to me that there isnt a delivery driver owned competitor that has just taken over 100% of the market.
NoPicklez 1y ago
I see these types of stats often, x number of companies now control over x% of x. On the face of it, what's the issue? Food delivery starts out as this awesome new tech that allows delivery and its prices are cheap for early adoption, lots of small players come to the market to try and ride the hype. The service grows in popularity and becomes steady state, companies start to look to drive further profit, companies consolidate where possible to avoid shutting down altogether. Global markets impact fuel prices, food costs and sees the delivery services grow further in price for all those across the supply chain. How we have a number of steady state food delivery companies that have the capital, and/or subsidy capacity to run across different markets globally. Also fun fact, Deliveroo doesn't operate in Australia and had to close due to high costs. Australian Government has been looking to increase rights of gig-economy workers, a cost that smaller player wouldn't be able to handle.
kotoriii 1y ago
[dead]
mkbelieve 1y ago
I'd love to live in a country where these apps are developed by the federal government as open source freeware tools for local governments to offer tip-free deliveries to citizens, and well paying jobs with good benefits.
- atomicnumber3 1y ago
  Unfortunately, in the US that would just mean every 4 years someone goes in and tries to literally destroy it so their buddies can privatize it. The poor post office, man.
deleted 1y ago
[deleted]
jamboca 1y ago
I have always been curious why I don't see more local food delivery companies in my city. I imagine for all cities where there is a market for DoorDash, a local company could beat them out with more specialized services catered to that region.
efitz 1y ago
If there are 5 companies, doesn’t that count as “competition”? If not, how many companies does there have to be to have “competition”? If there were only 1 or 2 companies, that would seem much more of a problem.
- huitzitziltzin 1y ago
  Great question! And a great example of why the central question in any antitrust issue is defining the market. Define it narrowly enough, and Firm A buying Firm B might create a monopoly - the regulator cannot approve that. Define it broadly, and Firm A buying Firm B takes the market from 21 firms to 20 - the regulator is unlikely to stand in the way. (In practice the market definition question in the US will often happen in front of a judge and the two sides are the merging parties vs. the regulator (FTC or DOJ).) In this case, is the relevant market “restaurant delivery service via an app” ? In that case five firms is (likely) moderately concentrated at last. (If you have the market shares of the five firms, you can compute an index called the HHI to get a rough sense of how much more concentrated the market will be before and after a merger.) However… “app based food delivery” doesn’t seem like a credible market to me. The firms are unlikely to have pricing power either over restaurants or customers. Candidate competing markets: - going to the restaurant directly - making food at home - delivery provided by the restaurant Any one of the five firms currently in the market who wanted to buy another would argue to include all three as the “relevant market” in which case their share (both before and after) is tiny. The regulator will argue for a narrower definition. When you see commentary on this website about “X is a monopolist” or strong claims like that (which are made frequently!), almost never is there any appeal to a market definition! Fortunately judges get better input than HN commentators.
- hn_throwaway_99 1y ago
  But there are only 1 or 2 companies in any particular market. I'm in the US, where DoorDash and Uber Eats dominate. I've never even heard of the other 3 (Meituan, Prosus, Delivery Hero) which dominate in other regions.
- ikurei 1y ago
  5 companies in a city is probably great, but this is 5 companies globally. Where I live there's only 2 companies really, and I'm guessing in almost every market it'll be 1 to 3.
ilmoi 1y ago
and? network effects. what's so surprising.
hintymad 1y ago
Isn't it funny? Lina Khan and the US government in general blocked all kinds of tech acquisition and merger to the point that companies got creative and as a result many Windsurf employees got screwed. On the other hand, it's totally normal that a handful companies control our food supply chain. And it's totally normal for the federal government to spend $2.5B to revamp a 4/5-story HQ. In contrast, China built Hangzhou Bay Bridge of 36 kilometers for less than $2B. The U.S is starting to feel more and more like the late Western Roman Empire — tangled in the competing interests of entrenched factions, with real reform no longer possible
- dathery 1y ago
  > Lina Khan and the US government in general blocked all kinds of tech acquisition and merger to the point that companies got creative and as a result many Windsurf employees got screwed. On the other hand, it's totally normal that a handful companies control our food supply chain. Lina Khan's FTC also successfully sued to block the Kroger-Albertsons merger...
ram_rar 1y ago
Can someone help me understand how many companies are generally needed for healthy competition, as opposed to a market being considered fragmented or monopolistic? To the untrained eye, having 5 players might seem like a reasonable level of competition and suggest a functioning market. Personally, I’ve always seen food delivery as a premium service rather than an essential one — so it makes sense that there's a higher cost for the convenience of having a burrito delivered to your door in near real time.
- hn_throwaway_99 1y ago
  Because the 5 players are for the entire planet, not any individual market. In any particular market, there are one or two big delivery companies. The 5 companies are Meituan, DoorDash, Uber, Prosus, and Delivery Hero. I'm in the US, where DoorDash and Uber Eats are the major players. I've never even heard of the other three, which dominate non-US markets.
nikolayasdf123 1y ago
I expect some open-source, distributed, and free service will disrupt all of this
rightrighton87 1y ago
The thing about food delivery services is that it has one outcome people want -- to get their food delivered. It's no surprise the biggest contenders in the beginning of instant food delivery now have a monopoly. Now to stand out you need to be dirt cheap or offer something innovative/creative..I guess like with every other industry these days
xcxhjjg 1y ago
[dead]
deleted 1y ago
[deleted]
PieTime 1y ago
Responding to a deleted comment on tech control: They do already, google, Microsoft, meta, Amazon all AI defense contractors using their technology to suppress negative feedback to their involvement in military contracts. Police using surveillance to spy on journalists phones. Healthcare approval completely automated by AI and school that don’t know difference between student or AI homework.
BiteCode_dev 1y ago
Getting in the market now is super tough. We have a French company, called Delicity, that has been doing just that for the last few years. They have a smart strategy and determined people. It works, but they have to fight tooth and nail for each city they get a foothold in. I had a call with the founder, the guy has more dark circles than visible eyes.
lupusreal 1y ago
The elites don't want you to know, but you can pick up your own food for free. I have picked up 200 pizzas.
tomaytotomato 1y ago
All fueled by illegal/irregular/undocumented migrants. I think there will be some sort of socio-economic reckoning from this in the future...
LightBug1 1y ago
Tragic that I spent much of my economics classes at high school and university learning about "perfect competition". I get that it's a theoretical underpinning, and rarely a reality, but still. I remember learning that monopolies being really frowned upon ... and yet here we are ... in a world of increasing monopoly. The last two decades have been a joke in relation to anti-monopoly action.
denvermullets 1y ago
i stopped ordering delivery for the most part as i'd rather walk and get it than pay the markup. a lot of restaurants are either spinning up their own app with discounts OR are offering a discount for ordering directly thru them. and honestly, i'd rather a local restaurant get more profit than just cutting it over to one of the apps. a month ago my wife wanted to order chipotle on a lazy sunday and it was $64 for delivery and only $31 when i went to stand in line and get it. unreal.
physicsguy 1y ago
Is this not missing that lots of places still do their deliveries themselves? For e.g. in my city I can order Pizza from Dominoes or Pizza Hut. Both are located on the same road. Dominoes uses it's own staff, Pizza Hut uses Deliveroo. I've tried both but Dominoes will delivery reliably in 25-35 minutes, and Pizza Hut took over an hour and a half. Guess which one I use still!
AbstractH24 1y ago
These delivery companies have become a far bigger "Evil" than Amazon or any other megatech company people often like to criticize. Because they provide nearly no benefit to anyone on any side of the marketplace and increasingly offer horrible customer service. But as I write this on the deck of a lake cabin I rented in New Hampshire, I'm reminded how different the world is outside of big cities like my home in NYC. There is one place on Doordash up here.
- delichon 1y ago
  Please explain why people are collectively spending billions of dollars on these services if they provide nearly no benefit to anyone.
  - AbstractH24 1y ago
    I said "nearly," not no benefit whatsoever. Personally speaking, I use it because it allows me to be lazy. Every time I do I say next time I wont.
    - deleted 1y ago
      [deleted]
  - grafmax 1y ago
    VC funding subsidizing the entry of these firms into the market. Few competitors contributing to pricing power among these firms. Network effects arising from coordinating the multi-sided market of drivers, restaurants, and consumers. Early subsidization has led to the position of these firms as middlemen that can extract something akin to rent from their dominant market position. The vig that middlemen collect isn’t a benefit to consumers but something they pay for with every transaction (price mark ups, service fees, narrowed choices). No, profit isn’t a sign of consumer benefit. Often it’s quite the opposite actually.
robertlagrant 1y ago
How do they measure 90%? If every restaurant in the US used Uber Eats and also had their own delivery, what % would their methodology say that Uber Eats had?
AtlasBarfed 1y ago
Do they control your car, legs, and bike? Shockers, cartel to monopoly power exists in virtually all markets. Even things like farming whose geographic distribution and commidification maybe monopoly resistant are monopolized in processing, seed, tools,etc by companies like ADM.
marve087 1y ago
A person shared how a post about a hacker named Marie helped them. They said they reached out to her through email:(infocyberrecoveryinc@gmail.com and Telegram:@Marie_consultancy) trusting she would help. Marie successfully hacked into their husband's phone and email. The person was able to see everything for themselves, realizing their husband was cheating. They posted this to help others who might need similar help
hnburnsy 1y ago
Five seems not that bad when compared to things like phone OS, CPUs, GPUs, browsers, where we get 2-3.

294 points by goinggetthem 1y ago

I would care a lot more if this market had even existed as recently as 15 years ago, but most of what this article is making a case for is that the next 5 years in this space are almost completely unpredictable.

mattmaroon 1y ago
And the alternative to restaurant delivery service is really the way we get the other 98% of our food. Anything I can ignore without being at some sort of disadvantage I don’t really get worked up about consolidation. I wish we had more than 3 cell phone networks, this could all be one and I’ll just drive to the restaurant.
- tptacek 1y ago
  There was a discourse prior to the last election about how cost of living was out of control based on people sharing delivery bills from their "burrito taxi". I do get that this article isn't "about" that discourse, it's about an investment thesis, but my real point is just: there is no reason to believe any part of this market has settled to the point where you could make reliable predictions. Everything is very new.
  - mattmaroon 1y ago
    Yeah I remember Jeff Bezos saying something very much like that at the launch of the kindle phone. Something like “smart phones have only been around for seven years there’s no reason to think the two platforms in the lead now will always be the only two.” Sometimes a market has already ossified five years in. I guess we’ll see.
deleted 1y ago
[deleted]
morsch 1y ago
I don't understand, are you saying the market was so small that it might as well not have existed? I don't have the impression that it's gotten magnitudes bigger here in Germany, maybe in China it did (what hasn't), in the US...? People just use the web instead of using a phone. AT&T didn't charge a commission.
- tpmoney 1y ago
  Realistically in the US before the various online delivery companies figured out how to make it work, most places just didn't do delivery at all. Traditionally pizza places and Chinese food were something you could order delivered. Almost everything else was either drive through or take-out.
  - asdff 1y ago
    What is sort of crazy is that these delivery services didn't even supplant pizza delivery. All the major chain pizza delivery places and most of the local spots all still run their own delivery service long into this app era. It kind of makes sense. App delivery is notorious for being pretty terrible service quality and having the food end up worse with more time spent between kitchen and you eating it. Pizza delivery on the other hand has been seen as quick with drivers interested in earning their tip, pizza places being conservative with delivery radius to not overextend their drivers, etc. Customers don't like getting an inferior product or service one day.
    - to11mtm 1y ago
      > App delivery is notorious for being pretty terrible service quality and having the food end up worse with more time spent between kitchen and you eating it. Pizza delivery on the other hand has been seen as quick with drivers interested in earning their tip, pizza places being conservative with delivery radius to not overextend their drivers, etc. Customers don't like getting an inferior product or service one day. Additionally, at least in my experience it's pretty easy to get to where just paying the delivery fee of a pizza place is cheaper than paying for inflated per-item rates.
- 1y ago

ro_bit 1y ago

The title scared me a bit before I opened the article and realized it was talking about restaurant->consumer food delivery services. While that isn't great, I was initially thinking was that the companies that facilitate the food delivery supply chains around the world were massively consolidated (I sure hope they aren't)

Tostino 1y ago
I built one of the trade promotion management (TPM) tools used in that space and had to deal with these companies daily for the last decade. There are absolutely a bunch of acquisitions/ consolidation in that food distribution space, but there are still hundreds of different distributors just in the US. However, most volume does flow through the largest distributors. For example, I had to build a specific feature to merge distributors after an acquisition happens in the industry, to make the product work properly because that's such a common occurrence. Had the same type of feature for manufacturers (my customers) also, because they kept buying each other.
- ro_bit 1y ago
  Thanks for your response! I love this forum for how many experts chime in in the comments section
ks2048 1y ago
I'm pretty sure the food supply sources are massively consolidated. I don't know about the delivery part or why that would matter more than the actual food production. A quick search will lead to quotes like "Four companies now control more than half of the market in chicken processing (Tyson, JBS, Perdue, and Sanderson), close to 70 percent in pork (Smithfield, JBS, Tyson, and Hormel), and nearly three quarters in beef (JBS, Tyson, Cargill, and National Beef)"
- khurs 1y ago
  Margins on food staples like Chicken are very low, which suggests that consolidation is inevitable. Supermarket margins are also very low.

closewith 1y ago

> total food delivery market worldwide This is the article's claim, but I'm fairly certain it's of the food delivery aggregator market. There's still plenty of independents.

flymasterv 1y ago
Yeah, there’s no way Domino’s doesn’t appear on that chart.

mrweasel 1y ago

One of those companies are available where I live, and I'll never use them, because they make my pick ups insufferable. I have kids, and can see McDonalds from my bedroom window, so I have more McDonalds points than I care to admit. Wolt is pissing me off every time. The amount of time the McDonalds staff needs to dedicate to Wolt staff is insane. They could easily serve twice the customer in resturante/drive-through if they didn't have to help a borderline incompetent Wolt staffer on a moped. It's actually rude to priorities deliveries over in restaurant customers. For that alone I will never use Wolt. Fortunately every single good pizza place nearby have their own drivers, who are actually polite and competent.

blibble 1y ago
I don't see the attraction of these apps either the food arrives lukewarm, in a smaller portions and costs more in addition their widespread use hurts the restaurants you like and drives down wages for society, because the only people who can live on what they pay out to the drivers are illegal immigrants paying zero tax (with the state paying for room and board) it's all negatives
bowsamic 1y ago
I’ve had this experience specifically with Wolt in Germany: sat in a busy restaurant with sit in diners waiting 2 hours for their meals while the kitchen seemed to be catering for a constant stream of Wolt drivers. And the real kicker is that of course since this is Germany all the negative reviews have been sued away, including my wife’s very moderate 3 star review. Of course German restaurants will claim it is libel if you write that you had to wait for your food

salomonk_mur 1y ago

Rappi is missing. It's huge in all of Latin America.

neoecos 1y ago
You're absolutely right, I'm guessing the GMV of rappi should appear on the graph. My guess is about 3-5B.

hn_throwaway_99 1y ago

This is essentially the story of tech companies across nearly every industry where they have come to dominate. This is one reason that I see most tech companies as essentially a net negative for society at large, as the goal is nearly always to control a large monopoly (and this is fully admitted by many tech leaders, e.g. Thiel) which the Internet makes possible. Pre-Internet you would see the same dynamics, but usually on a much smaller regional scale. I think that many of the growing problems in society today are fundamentally attributable to the extreme concentration of wealth and power that modern tech enables.

JumpCrisscross 1y ago
It’s the story of most mature industries. Food delivery also remains cutthroat enough that this is a strange place to launch this complaint from.
- sroussey 1y ago
  It is also weird that there isn't a company with 2/3 of the market. Eventually it will happen i guess.
  - TylerE 1y ago
    Sysco is probably pretty close if you ignore the extremes of the market.
    - drivingmenuts 1y ago
      While Sysco is a monopoly, they apparently don't make anyone angry enough to get rid of them. My guess is that they are pretty even-handed across an entire industry and their customers are knowledgeable enough to not screw up a good thing when they see it.
      - Karrot_Kream 1y ago
        No I think tech just gets obsessive media coverage these days (both from MSM and from influencers.) I know lots of event companies that hate Sysco, it just doesn't get as many clicks as a tech company does.

Reason077 1y ago

Less competition would certainly be bad for consumers and drivers. But has that actually happened here? Doordash and Deliveroo do not operate in the same markets, so their merger would not reduce competition in any given market. Prosus is a big conglomerate with its fingers in many different industries. But unless it starts buying multiple delivery companies that operate in the same markets, its acquisition of Just Eat also doesn’t appear to be reducing competition.

asdff 1y ago
I think tech companies that are in sectors like this with a great deal of money moving around a few different entities tend to inadvertently operate as de facto cartels in a lot of ways. They tend to mirror business decisions due to poaching eachother for the same talent and consulting with the same agencies who are giving them the same information and findings. The way they set up their companies and operate is all pretty much the same and designed to be similar so as to be useful for investors looking to compare businesses in the sector. ux patterns are the same or similar enough. How they pay their drivers also the same or similar enough. When there is this much similarity of behavior in the sector one has to ask if there would even be a difference for the consumer between having all delivery under 1 company or 10000 companies all operating the same business model? No different than a small town restaurant scene lost to 15 different chain fast food restaurants all operating the same franchise model: customers have diversity of business on paper, but not really since it is all just more or less the same sort of business with marginally different offerings.

andybak 1y ago

I still tend to discover a takeaway or restaurant and then figure out how to get them to deliver. I've never not ordered from somewhere I was keen on based on their choice of delivery service. If the consolidation results in price hikes and poor service, what's the lock-in? Why can't the takeaways just go rogue and offer independent deliveries?

spacephysics 1y ago
Lots of their infrastructure for handling orders (iPads, software integration into their payment system) was done around Covid, and some have started to integrate in-person orders through the same “single unified system” creating a higher and higher cost to switch delivery systems. AFAIK there’s no well-supported open source order/delivery management software. The companies that were ready during covid took all the extra, enormous demand for building delivery and order online systems built atop a typically antiquated order management system and have stuck around since Sometimes i’ll get a cheaper delivery/food cost calling vs ordering online, but now some places are just raising their other prices to match online
- b112 1y ago
  And yet, why do you need software? In the 80s, I delivered pizza with no software. The place had a normal cash register, for pickups. People would call, order, and we'd write it down. They it'd go on a wire with a clothes pin, until made. Then it went with the driver. Each delivery was written down before leaving with it. This worked for decades for everyone in the industry, flawlessly, perfectly, without issue. Why is software required? Any given reasons are an unneccessary complication. And here's the thing. Even in Palo Alto I order from companies still doing it this way. The above system, paperwork wise .. again, is perfect. It's been done forever. It is faster and far less expensive than any unified payment and order system. Seems to me, they're the smart ones.
  - asdf6969 1y ago
    Everyone hates calling and apps give customers a list of restaurants with menus to browse. Restaurants also do all of their in-restaurant management with software (why not paper? ask them idk) which I assume has some integration with the app. I can imagine some type of open protocol that lets them self-host an order service though, or at least an open solution that’s hosted by many providers and many separate apps. That would be nice for everyone

thisisit 1y ago

I think this will be even more consolidated in the future. Or mostly duopoly in many markets. Food delivery is capital intensive. It is unlikely that new players enter the market.

daedrdev 1y ago

I think the truth is restaurant food delivery is a luxgury good, literally “private taxi for your burrito” yet many people spend like it isnt.

to11mtm 1y ago
Restaurant delivery... I tend to agree. 'nonperishable food' or 'properly packed short travel' (i.e. dairy/frozen) IMO is a fairer niche of 'could be non-luxury with better societal outcomes', except for the 'as close to JIT as possible'. There's ways to optimize the process to where something on the scale of 10-20 homes could get their main groceries delivered two or 3 times a week and the overall cost would be lower than all of them doing so. Yeah you'd need a reefer van or an otherwise replenishable source of cold for dairy/frozen but at that scale the cost of such makes a lot more sense. Biggest problem is getting the right buy-in and mindset from consumers.
- watwut 1y ago
  Difference is you can stock large quantity of frozen foods any time it is convenient to shop. As in, frozen food delivery is not all that useful. When you work from home and cant cook, delivery can happen right now. Or if you are having a small gathering with friends, delivery makes your life easier exactly when you need it.
- mtrovo 1y ago
  I totally agree in theory, in the same way I agree that Amazon delivering everything from a nearby warehouse is far more optimal than having thousands of small bookshops or random shops in prime locations. I think that's the main vision behind Travis Kalanick's CloudKitchens since he left Uber. You could order food prep for your week from a choice of menus, and the food would be prepared in an industrial kitchen for you and thousands of other people around you. It's basically restaurant-quality food that you can eat at home and isn't frozen. Unfortunately for the meal prep market, I believe the break-even point for scale is much more difficult to achieve. Food is like hardware but with a much shorter end-of-life. You would need consistency in ordering to avoid excess spoilage and to operate at scale within small geographical pockets to make the delivery worthwhile. I really believe this could work with the right demographics and in the right geography, it's just much harder than simply delivering takeaways.

esco27 1y ago

The food industry is due for a good old opensource disruption, where each restaurant can setup their private menu hub (like you would an instagram account), add their payment processing details, and start delivering their own orders. It's a win-win for the restaurant and their recurring customers.

redleader55 1y ago
What about users? Will they install one app for each restaurant they order from on their phone or will they prefer to do everything in the same app?
- nickjj 1y ago
  There are middle man services for certain types of food in certain areas. For example Slice is a popular one for pizza. I know a business owner who uses it. They have an app and optionally an online menu on your custom domain to take online orders and physical hardware for taking orders in your store. Think POS system, register, terminal, printers, etc.. For a business owner that covers you for accepting online and offline orders, and you can deliver direct to your customers. 95% of his online delivery orders go through this system because DoorDash charges him (the business owner) 30% for each order so he raised his prices there to partially offset that. Slice on the other hand is 5% cheaper than his baseline price for online orders for customers so it's a no brainer most use that. With that said, way more people call in or come in person than using the app. Probably a 90% / 10% split.
- carlosjobim 1y ago
  There's no need for apps to make online orders.
Reason077 1y ago
These certainly exist. My local favourite Thai restaurant has its own ordering website and has its own staff deliver the order, with no markup over the in-restaurant menu prices. The company that operates their ordering platform is mobihq.com (I have no affiliation with them)
1y ago

Neywiny 1y ago

I think 5 is a good number based on no data or experience. Feels like enough where you could reasonably tell one to pound sand if they start getting too greedy, while not being forced to just take the other 1.

faizshah 1y ago

Meanwhile I have seen a lot of local restaurants advertising how ordering through their own delivery/pickup service can be 30% less than Uber Eats or DoorDash on their takeout boxes (and consequently in your uber/doordash order). It’s interesting that some of the POS companies are getting into the market: https://www.toasttab.com/local https://www.toasttab.com/local There’s huge room for disruption in this model when a $12 chipotle order costs the consumer $30 after higher menu prices + delivery fees + tip.

Workaccount2 1y ago
When I worked at a restaurant that did Ubereats/door dash/GrubHub, we had a 15% upcharge on order through those platforms. We would tell repeat customers they could use our website/app/phone to order directly and save the 15%. Almost no one converted. Convenience really is king.
- faizshah 1y ago
  So what this POS company is doing that’s kind of interesting is they have a mobile app just like Uber Eats/Doordash but it seems to be direct through the restaurant: https://apps.apple.com/us/app/local-by-toast/id1362180579 https://apps.apple.com/us/app/local-by-toast/id1362180579 Actually when I ordered through it I paid $45 instead of $60 via DoorDash/Uber Eats but the order was delivered by Uber. The reason why I think this version will work is because it’s the same level of convenience in a centralized mobile app so single payment method, single portal to browse restaurants etc. (I have no association with this company I just was looking into this last week on the train)
- carlosjobim 1y ago
  Win-win then, since you made the upcharge.

TheMagicHorsey 1y ago

I know these are three sided marketplaces and difficult to coordinate demand and supply ... but why isn't there more locally hosted town and city level options that undercut the national/international conglomerates? Food delivery is ultimately a local thing.

Aeolun 1y ago

Two companies now control 90% of the phone market. I think the restaurant food delivery market is quite healthy.

khurs 1y ago
Do you mean the App Stores rather than the phone market? That is soon to be 3, as Harmony OS takes hold in China and other markets.
- immibis 1y ago
  I thought Harmony was a banned word in China. It's what the government called its own totalitarianism, then it's what the people called the government's totalitarianism, then the government banned it because they don't want people to talk about the totalitarianism.

bawolff 1y ago

5 companies dominate a market that 5-10 years ago didn't even exist. That doesn't exactly sound terrible.

afavour 1y ago
Of course it did. People have been ordering delivery food for decades. They just called up the restaurant to do it.
- bawolff 1y ago
  I dont know where you live, but that was absolutely not true where i lived. The only exception was chinese and pizza. Nobody else offered delivery. The current delivery market is much more than that.

throwpoaster 1y ago

Sounds like a fairly normal market structure.

deleted 1y ago

[deleted]

v5v3 1y ago

My understanding is that the drivers are non-exclusive and can work for multiple companies at the same time. So as their is a ready supply of drivers, anyone who can raise an amount of money, and find a niche can enter the fray? The suppliers (restaurants) are not happy with 30% or so being taken by the giants.

kurofune 1y ago

Is this surprising? This is what our actual economic system is all about: a series of market oligopolies whose greed is unchecked by our political establishment and legal apparatus with the complicity of the voting masses. Any attempt to implement measures to palliate the social decay and corruption it breeds will be branded as chinese communism and opposed by the media and the public. We have collectively decided that the economy shouldn't be in service of the people, canis canem edit.

gonzo41 1y ago

Regardless of market position, are food delivery companies actually making money at the moment?

paxys 1y ago

I can't think of a single industry or segment, whether consumer or enterprise, where 90%+ of the market isn't controlled by 1-5 companies. That's just how business works.

readthenotes1 1y ago
Chinese food restaurant? Lawn service If I spent more than 2 seconds I could probably think of others
diatone 1y ago
Schooling

thaumasiotes 1y ago

This post doesn't appear to present any evidence that five companies control any significant share of the food delivery market. It looks at transaction volume of major deliverers, comparing them to each other. But it's not at all clear that major deliverers are even a majority of the delivery market. There are no pizza chains on the list. There are certainly no individual restaurants on the list. > Why is my $8 burger $23 after fees - An average reddit user Delivery in China (through Alipay, which may or may not be backed by Meituan) is generally cheaper after fees than it would be if you just went and bought the food in person. This might explain why Meituan has so much more transaction value than Doordash and Uber Eats. But it's not something I'd imagine drives a lot of user complaints.

mupuff1234 1y ago

I honestly just can't comprehend how people so easily just throw away money on these apps - The fees are ridiculous on top of already expensive restaurant prices.

bravesoul2 1y ago

> As long as food delivery is better than other ways of consuming food, like cooking, takeaways, or dining out, it will be able to keep customers in the network. Made me laugh out loud. It's strictly the worst option. Only use it if my job wants to pay, or if very sick. Cold food. Unpredictable delivery times. More expensive than eating out. Usually less nutritious than cooking yourself. And of course expensive as hell.

protocolture 1y ago

It continues to be crazy to me that there isnt a delivery driver owned competitor that has just taken over 100% of the market.

NoPicklez 1y ago

I see these types of stats often, x number of companies now control over x% of x. On the face of it, what's the issue? Food delivery starts out as this awesome new tech that allows delivery and its prices are cheap for early adoption, lots of small players come to the market to try and ride the hype. The service grows in popularity and becomes steady state, companies start to look to drive further profit, companies consolidate where possible to avoid shutting down altogether. Global markets impact fuel prices, food costs and sees the delivery services grow further in price for all those across the supply chain. How we have a number of steady state food delivery companies that have the capital, and/or subsidy capacity to run across different markets globally. Also fun fact, Deliveroo doesn't operate in Australia and had to close due to high costs. Australian Government has been looking to increase rights of gig-economy workers, a cost that smaller player wouldn't be able to handle.

kotoriii 1y ago

[dead]

mkbelieve 1y ago

I'd love to live in a country where these apps are developed by the federal government as open source freeware tools for local governments to offer tip-free deliveries to citizens, and well paying jobs with good benefits.

atomicnumber3 1y ago
Unfortunately, in the US that would just mean every 4 years someone goes in and tries to literally destroy it so their buddies can privatize it. The poor post office, man.

deleted 1y ago

[deleted]

jamboca 1y ago

I have always been curious why I don't see more local food delivery companies in my city. I imagine for all cities where there is a market for DoorDash, a local company could beat them out with more specialized services catered to that region.

efitz 1y ago

If there are 5 companies, doesn’t that count as “competition”? If not, how many companies does there have to be to have “competition”? If there were only 1 or 2 companies, that would seem much more of a problem.

huitzitziltzin 1y ago
Great question! And a great example of why the central question in any antitrust issue is defining the market. Define it narrowly enough, and Firm A buying Firm B might create a monopoly - the regulator cannot approve that. Define it broadly, and Firm A buying Firm B takes the market from 21 firms to 20 - the regulator is unlikely to stand in the way. (In practice the market definition question in the US will often happen in front of a judge and the two sides are the merging parties vs. the regulator (FTC or DOJ).) In this case, is the relevant market “restaurant delivery service via an app” ? In that case five firms is (likely) moderately concentrated at last. (If you have the market shares of the five firms, you can compute an index called the HHI to get a rough sense of how much more concentrated the market will be before and after a merger.) However… “app based food delivery” doesn’t seem like a credible market to me. The firms are unlikely to have pricing power either over restaurants or customers. Candidate competing markets: - going to the restaurant directly - making food at home - delivery provided by the restaurant Any one of the five firms currently in the market who wanted to buy another would argue to include all three as the “relevant market” in which case their share (both before and after) is tiny. The regulator will argue for a narrower definition. When you see commentary on this website about “X is a monopolist” or strong claims like that (which are made frequently!), almost never is there any appeal to a market definition! Fortunately judges get better input than HN commentators.
hn_throwaway_99 1y ago
But there are only 1 or 2 companies in any particular market. I'm in the US, where DoorDash and Uber Eats dominate. I've never even heard of the other 3 (Meituan, Prosus, Delivery Hero) which dominate in other regions.
ikurei 1y ago
5 companies in a city is probably great, but this is 5 companies globally. Where I live there's only 2 companies really, and I'm guessing in almost every market it'll be 1 to 3.

ilmoi 1y ago

and? network effects. what's so surprising.

hintymad 1y ago

Isn't it funny? Lina Khan and the US government in general blocked all kinds of tech acquisition and merger to the point that companies got creative and as a result many Windsurf employees got screwed. On the other hand, it's totally normal that a handful companies control our food supply chain. And it's totally normal for the federal government to spend $2.5B to revamp a 4/5-story HQ. In contrast, China built Hangzhou Bay Bridge of 36 kilometers for less than $2B. The U.S is starting to feel more and more like the late Western Roman Empire — tangled in the competing interests of entrenched factions, with real reform no longer possible

dathery 1y ago
> Lina Khan and the US government in general blocked all kinds of tech acquisition and merger to the point that companies got creative and as a result many Windsurf employees got screwed. On the other hand, it's totally normal that a handful companies control our food supply chain. Lina Khan's FTC also successfully sued to block the Kroger-Albertsons merger...

ram_rar 1y ago

Can someone help me understand how many companies are generally needed for healthy competition, as opposed to a market being considered fragmented or monopolistic? To the untrained eye, having 5 players might seem like a reasonable level of competition and suggest a functioning market. Personally, I’ve always seen food delivery as a premium service rather than an essential one — so it makes sense that there's a higher cost for the convenience of having a burrito delivered to your door in near real time.

hn_throwaway_99 1y ago
Because the 5 players are for the entire planet, not any individual market. In any particular market, there are one or two big delivery companies. The 5 companies are Meituan, DoorDash, Uber, Prosus, and Delivery Hero. I'm in the US, where DoorDash and Uber Eats are the major players. I've never even heard of the other three, which dominate non-US markets.

nikolayasdf123 1y ago

I expect some open-source, distributed, and free service will disrupt all of this

rightrighton87 1y ago

The thing about food delivery services is that it has one outcome people want -- to get their food delivered. It's no surprise the biggest contenders in the beginning of instant food delivery now have a monopoly. Now to stand out you need to be dirt cheap or offer something innovative/creative..I guess like with every other industry these days

xcxhjjg 1y ago

[dead]

deleted 1y ago

[deleted]

PieTime 1y ago

Responding to a deleted comment on tech control: They do already, google, Microsoft, meta, Amazon all AI defense contractors using their technology to suppress negative feedback to their involvement in military contracts. Police using surveillance to spy on journalists phones. Healthcare approval completely automated by AI and school that don’t know difference between student or AI homework.

BiteCode_dev 1y ago

Getting in the market now is super tough. We have a French company, called Delicity, that has been doing just that for the last few years. They have a smart strategy and determined people. It works, but they have to fight tooth and nail for each city they get a foothold in. I had a call with the founder, the guy has more dark circles than visible eyes.

lupusreal 1y ago

The elites don't want you to know, but you can pick up your own food for free. I have picked up 200 pizzas.

tomaytotomato 1y ago

All fueled by illegal/irregular/undocumented migrants. I think there will be some sort of socio-economic reckoning from this in the future...

LightBug1 1y ago

Tragic that I spent much of my economics classes at high school and university learning about "perfect competition". I get that it's a theoretical underpinning, and rarely a reality, but still. I remember learning that monopolies being really frowned upon ... and yet here we are ... in a world of increasing monopoly. The last two decades have been a joke in relation to anti-monopoly action.

denvermullets 1y ago

i stopped ordering delivery for the most part as i'd rather walk and get it than pay the markup. a lot of restaurants are either spinning up their own app with discounts OR are offering a discount for ordering directly thru them. and honestly, i'd rather a local restaurant get more profit than just cutting it over to one of the apps. a month ago my wife wanted to order chipotle on a lazy sunday and it was $64 for delivery and only $31 when i went to stand in line and get it. unreal.

physicsguy 1y ago

Is this not missing that lots of places still do their deliveries themselves? For e.g. in my city I can order Pizza from Dominoes or Pizza Hut. Both are located on the same road. Dominoes uses it's own staff, Pizza Hut uses Deliveroo. I've tried both but Dominoes will delivery reliably in 25-35 minutes, and Pizza Hut took over an hour and a half. Guess which one I use still!

AbstractH24 1y ago

These delivery companies have become a far bigger "Evil" than Amazon or any other megatech company people often like to criticize. Because they provide nearly no benefit to anyone on any side of the marketplace and increasingly offer horrible customer service. But as I write this on the deck of a lake cabin I rented in New Hampshire, I'm reminded how different the world is outside of big cities like my home in NYC. There is one place on Doordash up here.

delichon 1y ago
Please explain why people are collectively spending billions of dollars on these services if they provide nearly no benefit to anyone.
- AbstractH24 1y ago
  I said "nearly," not no benefit whatsoever. Personally speaking, I use it because it allows me to be lazy. Every time I do I say next time I wont.
  - deleted 1y ago
    [deleted]
- grafmax 1y ago
  VC funding subsidizing the entry of these firms into the market. Few competitors contributing to pricing power among these firms. Network effects arising from coordinating the multi-sided market of drivers, restaurants, and consumers. Early subsidization has led to the position of these firms as middlemen that can extract something akin to rent from their dominant market position. The vig that middlemen collect isn’t a benefit to consumers but something they pay for with every transaction (price mark ups, service fees, narrowed choices). No, profit isn’t a sign of consumer benefit. Often it’s quite the opposite actually.

robertlagrant 1y ago

How do they measure 90%? If every restaurant in the US used Uber Eats and also had their own delivery, what % would their methodology say that Uber Eats had?

AtlasBarfed 1y ago

Do they control your car, legs, and bike? Shockers, cartel to monopoly power exists in virtually all markets. Even things like farming whose geographic distribution and commidification maybe monopoly resistant are monopolized in processing, seed, tools,etc by companies like ADM.

marve087 1y ago

A person shared how a post about a hacker named Marie helped them. They said they reached out to her through email:(infocyberrecoveryinc@gmail.com and Telegram:@Marie_consultancy) trusting she would help. Marie successfully hacked into their husband's phone and email. The person was able to see everything for themselves, realizing their husband was cheating. They posted this to help others who might need similar help

hnburnsy 1y ago

Five seems not that bad when compared to things like phone OS, CPUs, GPUs, browsers, where we get 2-3.