Food Delivery Wars: 3 Takeaways From The UberEats, Postmates, Grubhub, DoorDash Ecosystem—How It…

The problem for the restaurants is that the more successful the “aggregators” of customer demand become over time, the less power the restaurants themselves have individually.

It would be glib to suggest that most restaurants can survive by simply pivoting to delivery. Indeed, many won’t—and not just because some consumers might be afraid of lukewarm trout. The bigger problem is that the most popular delivery items (appetizers and entrées) tend to be the least profitable, while delivery consumers rarely order the higher-... See more

A lot of what you hear and read about the big delivery networks — DoorDash, Grubhub, Uber Eats, etc. — is that they’re a terrible economic deal for restaurants. It’s an especially tough tradeoff for neighborhood restaurants and startups, which don’t have much leverage or much profit margin to spare.

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.”

It’s a bit of a different situation for fast-casual chains operating at scale, where the delivery networks sit somewhere on the spectrum between “necessary evil” and “incremental growth driver.”