A Bigger Truth About Restaurant Food Delivery

Grubhub’s original model was a marketplace for consumers to order food from independent restaurants that already had their own delivery fleets. Though this was a game-changer for consumers, it constrained supply to only listing restaurants that could perform their own deliveries. This was a mistake.

There’s work involved in making the shift to delivery and takeaway — time and money that a restaurant likely does not have to spend. In the best-case scenario, the model effectively turns restaurants into so-called “ghost kitchens,” eliminating the need for nearly all front-of-house staff. David Chang has called the pivot to delivery “fools gold.”

Before the pandemic, delivery apps made sense to drive incremental sales for restaurants that primarily made money on dine-in customers, says Chris Monk, founder and chief executive of Your Fare, an Austin, Texas-based startup that sells a system to restaurants for consolidating orders from delivery services. For most restaurants, though, the math ... See more

Despite these enormous acquisitions and partnerships, delivery app giants struggle to reach profitability, even while charging feeble restaurants exorbitant fees. From this viewpoint, the food delivery ecosystem is broken. It’s one of the reasons why smaller, more localized delivery services have emerged with a new focus: to help restaurants market... See more