Doordash and Pizza Arbitrage • Hacker News Board

Re: Doordash and Pizza Arbitrage

#171

Post by valuearb » Mon, May 18, 2020, 4:48 AM UTC

MattGaiser wrote: post #130

ngngngng wrote: post #64

I don't understand why doordash, uber eats, deliveroo, and similar business are starting to exist. Restaurants have been running successful delivery operations independently for ages. And there are many software offerings to help businesses get set up with delivering food. Why do we need a centralized on? Is it just the benefit of being able to browse in one app/website everything available for be delivered to you?

> Restaurants have been running successful delivery operations independently for ages. Crappy phone call driven ones with few checks for information accuracy. > Is it just the benefit of being able to browse in one app/website everything available for be delivered to you? Yes, that is a large part of it. I can be hungry and just pick up the DoorDash app and browse for food. I also have a single point of complaint for…

And still your order is wrong half the time.

Re: Doordash and Pizza Arbitrage

#172

Post by tptacek » Mon, May 18, 2020, 4:53 AM UTC

asdfaoeu wrote: post #169

astura wrote: post #104

Earlier quoted context omitted.

Yes, it's fraud. In general, knowingly obtaining money, goods or services you know you are not entitled to is fraud/illegal. Here's an example of someone going to jail for knowingly exploiting a glitch: https://www.inquirer.com/philly/hp/news_update/20071026_N_C_...

Your case is more clear cut because that is a glitch in the website. It seems that in this case Doordash is offering a promotion. Calling that fraud would be like calling taking advantage of reward points fraud.

It gets dicier when the restaurant starts shipping out plain pizza dough.

Re: Doordash and Pizza Arbitrage

#173

Post by [deleted] » Mon, May 18, 2020, 4:55 AM UTC

imgabe wrote: post #156

akiselev wrote: post #144

Earlier quoted context omitted.

How many transient backpackers actually work for these companies to fund their immediate journeys and what do they have to do with a debate on localized externalities that they never experience?

No idea. It is probably not anywhere near the number of salaried employees who bully local governments into passing wage laws they will never experience the unintended consequences of. Yet somehow they still feel entitled to decide for other people what working arrangements they should be allowed to make for themselves.

[deleted]

Re: Doordash and Pizza Arbitrage

#174

Post by adrr » Mon, May 18, 2020, 5:00 AM UTC

MattGaiser wrote: post #47

alteria wrote: post #42

This is absurd. Can someone explain to me why DoorDash exists? They're #1 in share, but I get the impression that they basically bought their spot. Grubhub has been operating in the space forever, is public, and generally had been profitable until VCs came to town. How is DoorDash doing anything than Grubhub? Wouldn't this capital do better in other investments? From the outside it seems like they've duped investors…

DoorDash is winning in terms of market share for one thing. https://www.cnbc.com/2020/01/17/doordash-took-the-lead-in-th... I bet a big thing for DoorDash is DashPass. That would lead to people ordering food for anything as the price is basically the same as in restaurant then.

I have Dashpass free from my credit card. Its not the same as ordering from directly from restaurant as Doordash marks up the prices 10% to 25%. I always thought Doordash was a terrible deal without it, you're paying marked up prices, delivery fee and a tip. Doordash is winning because they have the widest selection of restaurants since they are using their own drivers compared to Grubhub. Not sure why Postmates and UberEats failed to capture more market share since they offer the same service.

Re: Doordash and Pizza Arbitrage

#175

Post by wyattpeak » Mon, May 18, 2020, 5:04 AM UTC

ngngngng wrote: post #64

I don't understand why doordash, uber eats, deliveroo, and similar business are starting to exist. Restaurants have been running successful delivery operations independently for ages. And there are many software offerings to help businesses get set up with delivering food. Why do we need a centralized on? Is it just the benefit of being able to browse in one app/website everything available for be delivered to you?

One reason I haven't seen mentioned, maybe because it's not the case in America, but in Australia before Uber Eats your options for takeaway were somewhat limited. You could have all the Italian/Chinese/Indian you wanted delivered, but if you wanted a burger, or Mexican, or French food it was probably 50/50 there'd be anyone around who delivered.

Uber Eats vastly expanded the range of cuisines available, if they simultaneously lowered the quality (since these restaurants had no experience preparing food for delivery, and the delivery was usually slower since they didn't have in-house drivers).

Re: Doordash and Pizza Arbitrage

#176

Post by jrockway » Mon, May 18, 2020, 5:08 AM UTC

mlthoughts2018 wrote: post #38

MattGaiser wrote: post #31

Earlier quoted context omitted.

>rather having a large majority of other orders coming from these services. DoorDash has managed to change my behavior to the point that it is where I do when I am hungry, so I can see that being viable for a portion of the population.

Until the prices inevitably rise back up to the level they require to make up for the massive losses. Then that’ll just drive your behavior right back, probably much much faster than it took for DoorDash to establish this, meaning the “monopoly mode” profit time will be so short-lived as to recover next to nothing of the losses.

I am guessing that DoorDash will succeed in the very long term. Eventually they will not need independent restaurants, they can just start their own (and cut ingredient costs to whatever they need to make a profit). And eventually deliveries will be done by robots, so no workers to pay. I'm not saying this will happen tomorrow, but think 20 years out -- there is a lot of money to be made.

I am not sure that making something a commodity is necessarily bad. You can go to the grocery store and get store brand macaroni & cheese, kraft dinner, or some organic brand. Kraft and Amy's stay in business, so people must be buying those despite the higher cost. But the lower quality / lower cost version is available for people that want money more than better cheese powder. I don't think that's a bad thing, and is the direction that food delivery is going. (Starbucks didn't kill independent coffee shops, McDonalds didn't kill fine dining. DoorDash seems like that kind of thing to me.)

Re: Doordash and Pizza Arbitrage

#177

Post by beart » Mon, May 18, 2020, 5:08 AM UTC

joshvm wrote: post #165

ChuckMcM wrote: post #147

I love this story, especially about ordering dough pizzas. It reminded me of this twitter thread: https://twitter.com/meslin/status/1225834920611848192?lang=e... In which the author tries to order the Uline "box of boxes", a box of twenty-five (25) 6" x 9" x 6" boxes, only to have Amazon deliver a 6" x 9" x 6" box containing some random product. The collection product from Uline has the same bar code as the box itsel…

The automated system should say "weight, that can't be right". Works fairly reliably in supermarkets, especially if you allow a bigger margin of uncertainty on sku weight. Or verify the volume/shape - or both, like volumetric weight that shipping companies use. I'm guessing amazon has some system to automatically assign boxes based on the dimensions of stuff that's being picked.

Not all distribution centers validate weight, don't recall if Amazon does but I would be surprised if they don't. High speed scales are expensive.

Re: Doordash and Pizza Arbitrage

#178

Post by johntiger1 » Mon, May 18, 2020, 5:09 AM UTC

Barrin92 wrote: post #168

cletus wrote: post #166

Wow, that was great. And honestly good on them for profit-taking on this arbitrage. The author likes to pin this on zero-interest rates ("ZIRP") and that certainly explains why the system is awash with cash but I'd say he's missing a key point here. When I moved to NYC (~10 years ago) I didn't order delivery at all. Honestly it's a huge pain. To call someone up and try and communicate an order to someone who probably…

I honestly don't know if I'm living in a different world than everyone else but I've been ordering food and taking cabs all my life and I've never had to deal with any friction. Like, you call the pizzeria, tell them what you want and then some college student delivers your stuff, and if you order for more than 20 bucks it doesn't cost you anything. Not even being facetious, but what problem do these apps solve? I al…

Yeah, it seems like you didn't grow up in a big city?

Re: Doordash and Pizza Arbitrage

#179

Post by trixie_ » Mon, May 18, 2020, 5:10 AM UTC

mlthoughts2018 wrote: post #37

dvduval wrote: post #16

Lose a few 100 million today for a monopoly next year. I make the assumption here that these delivery services are intent on dominating the search results so that independent restaurants are not able to compete. They are forced into using the services, or rather having a large majority of other orders coming from these services.

The problem is all these businesses (ride share, food delivery), have extremely low margins and the tech to spin up a competitor is extremely cheap and commodity. Thus the “monopoly” you allegedly get later is deeply unsustainable at the profit level and scale required to recoup losses on any timescale that would work for investors, assuming you can even hold onto it in the face of constant reemergence of competitors…

It works great. All those management middle men of thousands of delivery and taxi companies have been replaced with software. Razor thin margins are enough to keep the servers running and a small team of developers managing it - for the entire planet.

It's difficult for any company to abuse their position as they're easily repalcable. So the margins will get lower, and more of the money paid by the customer will go directly to the supplier. Efficiency incarnate.

Re: Doordash and Pizza Arbitrage

#180

Post by LawnGnome » Mon, May 18, 2020, 5:10 AM UTC

Barrin92 wrote: post #168

cletus wrote: post #166

Wow, that was great. And honestly good on them for profit-taking on this arbitrage. The author likes to pin this on zero-interest rates ("ZIRP") and that certainly explains why the system is awash with cash but I'd say he's missing a key point here. When I moved to NYC (~10 years ago) I didn't order delivery at all. Honestly it's a huge pain. To call someone up and try and communicate an order to someone who probably…

I honestly don't know if I'm living in a different world than everyone else but I've been ordering food and taking cabs all my life and I've never had to deal with any friction. Like, you call the pizzeria, tell them what you want and then some college student delivers your stuff, and if you order for more than 20 bucks it doesn't cost you anything. Not even being facetious, but what problem do these apps solve? I al…

I bet you have the same accent as most of the people you deal with. I do not, having moved halfway around the world, and doing things over the phone is often surprisingly painful.