Originally Posted by Wolf359
The contract workers doing this gig are making even less than Uber or Lyft. The only reason they're doing it is because there's no Uber or Lyft business right now. They say Uber and Lyft people were making $200-$300 a day but the food delivery people were just making around $100. They basically don't get paid while they're waiting around for orders and you can only do so many orders before lunch time or dinner time is over.
I'm still scratching my head wondering how this works. The gig worker makes no money. The restaurant gets taken for about a 30% commission. The company charging those fees are losing hundreds of millions as they run promotions to increase volume. Just doesn't make sense. I'm just going to the restaurant directly. It's not like I'm doing anything important at home so I need them to save me some time.
1. People driving food delivery don't have the car age limitation like the ride share guys, they are likely people who can't qualify for ride share (old cars, bad driving records, have a kid in the back seats so they don't have to pay for child care while working). They lose money in accounting sense but they are likely not going to get any better alternative, so wearing out a beater is still going to keep their family feed better than unemployed.
2. Restaurants might not even know they are doing this as they got spoofed by grub hub with their listing, and they just order it for you with a company card like another customer. This is a grow at all cost we'll figure out how to make money later model, by keeping the growth story alive they can get funding from large investors (Sequoia Capital and its 20 sovereign funds investors). As long as the growth is happening everyone is happy on the accounting.
3. People who buy food from these places usually have their reason: 1. they are too busy to go out to order food far away, 2. they don't have a car and they can expense food, 3. corporate catering, 4. they have too much money / like to experiment with new things. During this pandemic we know corporate catering is dead, even good stable places like Specialty Bakery is closing (sad, as I am a huge fan), but there are people who work from home and don't want to spend time cooking and leave their kids alone at home so they are getting more business on them. People without cars and people with too much money will likely increase their businesses as well. Restaurants with their own delivery should really do as much of it as they can but without marketing, people wouldn't know about it, and order from these delivery companies instead. I personally use them when I'm on vacation in a resort area without cars, or when I have to baby sit a toddler at home, but not when I'm just lazy or have too much money.