# 5 Big Reasons the Delivery ‘Boom’ May Soon Go Bust



## MHR (Jul 23, 2017)

Photo: Bloomberg/Bloomberg via Getty Images​When lockdown restrictions forced the closure of dining rooms around the country, it seemed like a gold rush for Big Delivery, the collection of app-based services like DoorDash, GrubHub, Seamless, and others that act as third parties to connect hungry users with restaurants. Restaurant owners desperate for revenue had no choice but to turn to them. Customers stuck at home went from standing in line to ordering online; the act even took on something like a moral imperative as customers were told delivery could “save” the industry. In reality, what looked like a delivery boom now seems more like a delivery bust in disguise. DoorDash and GrubHub both owned up to losing $155.9 million and $145 million, respectively, last year, and it seems very likely things won’t get better, short of a total ghost-kitchen takeover. Here’s why.

*Growth Probably Isn’t As Big As It Seems

Regulators Are Eyeing the Services’ Most Controversial Tactic

Local Governments Are Looking at Other Ways to Empower Delivery Workers*

*Restaurateurs Are Actively Looking for Alternative Solutions

Customers Have Proven They Want to Order Directly From Operators*


Full article may be found at https://www.grubstreet.com/2021/05/5-reasons-the-food-delivery-boom-may-soon-go-bust.html


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## tohunt4me (Nov 23, 2015)

MHR said:


> View attachment 594263
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> Photo: Bloomberg/Bloomberg via Getty Images​When lockdown restrictions forced the closure of dining rooms around the country, it seemed like a gold rush for Big Delivery, the collection of app-based services like DoorDash, GrubHub, Seamless, and others that act as third parties to connect hungry users with restaurants. Restaurant owners desperate for revenue had no choice but to turn to them. Customers stuck at home went from standing in line to ordering online; the act even took on something like a moral imperative as customers were told delivery could “save” the industry. In reality, what looked like a delivery boom now seems more like a delivery bust in disguise. DoorDash and GrubHub both owned up to losing $155.9 million and $145 million, respectively, last year, and it seems very likely things won’t get better, short of a total ghost-kitchen takeover. Here’s why.
> 
> ...


Pizza Delivery seems to have slacked off.
For the 1st time in over a year, things seem to be returning to pre Covid " Normal".

Even more pronounced , after the Frenzy created by the last stimulus checks.


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## Lissetti (Dec 20, 2016)

I think it will still be busy. In Seattle, all the work from home tech workers and state shut down caused many of the small restaurants that relied on them, closed permanently. I'm sure this is a nationwide condition. As more people return to the office, they are more likely to order lunch rather than jump in traffic and drive to a restaurant.


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## tohunt4me (Nov 23, 2015)

Everywhere i go on the internet, i see DOORDASH adds. They are trying to oversaturate. A rerun of Ubers actions that we have all seen before. We know how the story goes.


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## Aw Jeez (Jul 13, 2015)

Pre-pandemic, having food delivered to your house wasn't really possible, other than pizza. But people have become accustomed to ordering-out. The industry may not see explosive growth in the future, but I think that people in general will continue to take advantage of non-pizza food delivery. Yes, it makes food more expensive, but there are other advantages - like for one thing, not having to go out to a restaurant, especially if you have kids. Here in Florida, restaurants were never totally closed to in-store dining like they were in other states - although some places _voluntarily_ stopped it. (Restaurants were limited for a while to 25% of their maximum rated seating capacity but that, and setting tables six feet apart still left some of them surprisingly crowded.) And yet Door Dash, etc. flourished. Here in my town, food delivery drivers make more (and especially more per mile) than "regular" Uber drivers. 

So the death of food delivery as a "thing" may be premature. In the past, the only thing we could really get delivered was pizza. That has changed. It's not going to go away. And as long as restaurants don't want to hire their own drivers, food-delivery apps and jobs will still exist.


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## tohunt4me (Nov 23, 2015)

We are past peak for food delivery.
I am no longer making over $200.00 cash tips in a day.

During pandemic, EVERY NIGHT was like Game Night.


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## ANT 7 (Oct 14, 2018)

When the music stops their will be no empty chairs left.

Peoples credit cards will get maxed out again, and the delivery cycle of turning $5 Starbucks coffee into a $10 coffee will end.


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## tipster98122 (Dec 10, 2015)

@Lissetti is right. The boom will still go on.

But, it won't be for everyone.

The delivery boom is over for most mom & pop and local fast casual restaurants as they will return to filling seats and cutting back on the delivery apps they used. These fast casual restaurants will also drop some of the delivery apps, if not all, as those apps return to charging(extorting) the ridiculous 30-35% commission prior to the pandemic(not all cities forced a reduction on delivery commissions). These restaurants were using these apps to just pay the bills and stay open. It was never a money-maker for them. 

The larger chains, however, will be shifting more of their operations towards delivery only concepts. It might come in the form of downsizing their existing dining areas to allow for more drive-thru and pickup areas, using an all ghost kitchen operation or a hybrid or even starting a spin-off brand that operates solely out of a ghost kitchen. Applebees, Chili's, Denny’s, TGI Fridays, and Carrabba’s started spinning off brands that operate solely out of ghost kitchens. NPD Group, which tracks U.S. restaurant sales, says delivery now makes up 11% of restaurant sales, up 86% since the pandemic began. 

The other guy who will likely be doing very, very well in this new market is the former CEO of Uber, Travis Kalanick, now CEO of Cloud Kitchens. 
He saw this trend coming. But I'll bet he never dreamed this pandemic would propel his company this far forward this fast.


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