Dozens of entrepreneurs across the U.S. have launched local restaurant delivery services. In Special Delivery, we profile 20 of these businesses. Whil

Special Delivery: Our New Report Shows How Local Delivery Services are Superior to the Big Apps

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2021-05-25 15:00:09

Dozens of entrepreneurs across the U.S. have launched local restaurant delivery services. In Special Delivery, we profile 20 of these businesses. While each is unique, all are proving that, when it comes to food delivery, locally based businesses are better and more efficient than the big Wall Street-backed apps. They charge lower fees, pay their drivers more, and keep wealth in the community. They succeed by strengthening independent restaurants, not preying on them.

The report concludes that the major apps offer no real economies of scale. Despite more than $26 billion in revenues in 2020 — dollars taken directly from the cash registers of restaurants — DoorDash, Grubhub, Postmates, and Uber Eats continue to post sizable losses. It’s a standard monopolistic strategy: By using Wall Street’s backing to expand rapidly and lock in market share, the big apps are trying to become permanent tollbooths between restaurants and their customers. Their goal is not to create value, but to extract it.

Meanwhile, the local entrepreneurs profiled in Special Delivery are building viable businesses and doing so while supporting restaurants and keeping dollars in the community. Their business models vary. Some are cooperatively owned, either by restaurants or delivery drivers. Some deliver items from local stores as well as restaurant meals. While all charge lower fees, some earn income on both the customer and restaurant sides of the ledger, while others only charge customers. As an owner-worker at one of the businesses told us, “The whole goal is to put the money back into our pockets, back into restaurant pockets, back into the community.”

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