Editor’s Note: As this post has gotten a bit of attention, we wanted to add in the name of my friend’s restaurants. They’re fighting the good fi

Doordash and Pizza Arbitrage

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2021-06-13 18:30:05

Editor’s Note: As this post has gotten a bit of attention, we wanted to add in the name of my friend’s restaurants. They’re fighting the good fight right now, so if you happen to be in the Kansas area, please support Aj’s NY Pizzeria (it’s NY-style pizza based in Manhattan and Topeka, Kansas, and while I’m biased, it’s good).

If capitalism is driven by a search for profit, the food delivery business confuses the hell out of me. Every platform loses money. Restaurants feel like they're getting screwed. Delivery drivers are poster children for gig economy problems. Customers get annoyed about delivery fees.

Last week's Uber-Grubhub news set off some antitrust alarms for me and got me thinking about the business of food delivery as a whole. But let me start this newsletter with a story about Pizza Arbitrage.

In March 2019 a good friend who owns a few pizza restaurants messaged me (this friend has made appearances in prior Margins' pieces). For over a decade, he resisted adding delivery as an option for his restaurants. He felt it would detract from focusing on the dine-in experience and result in trying to compete with Domino's.