Aligning Business Models to Markets - Kwokchain

How did we get to a place where billions of dollars are exchanged in millions of business transactions but there are no winners? My co-host Can and my restaurant friend both defaulted to the notion “delivery is a shitty margin business” when discussing this post. But I don’t think that’s sufficient here. Delivery can work. Just look at a Domino’s s... See more

For founders in search of a dominant model, the trickiest situations are when the value chain of an industry doesn’t allow for customer preferences to be the top priority.

Since the cost to provide utility is dropping, business models are evolving from rent-seeking to skin-in-the-game. Instead of just providing a service (utility), companies need to invest in their customers (vanity)

Where CloudKitchens and its peers rely on centralized processing and a flattened, undifferentiated business model, Tock starts from the assumption of distributed processing and a business model that differentiates on its prime costs: labor and ingredients.

Third-party delivery platforms, as they’ve been built, just seem like the wrong model, but instead of testing, failing, and evolving, they’ve been subsidized into market dominance. Maybe the right model is a wholly-owned supply chain like Domino’s. Maybe it’s some ghost kitchen / delivery platform hybrid. Maybe it’s just small networks of restauran... See more

Yet, despite this new source of e-commerce demand, restaurants have struggled to keep up. The dominant reason is that restaurant demand is inherently “peaky.” It’s even more peaky now that delivery and pick up are turning restaurants into omni-channel retailers. Restaurants have fixed labor costs that do not scale up or down with volatile demand th... See more