We really need a true crisis. Free market economy needs to let such companies to buncrupt. Lesson must be learned.
Unfortuanetelly looking what FED is doing, it won't happen soon :(
Doordash and Pizza Arbitrage
221–230 of 534 posts
Re: Doordash and Pizza Arbitrage
#222Just some back-of-the-napkin math if you wanted to do this "right". Let's say you hire drivers as employees and pay them $15/hr plus tips and reimburse them for mileage. You charge a $4.99 delivery fee. Drivers work set shifts and are paid hourly whether they are making deliveries or not. That means each driver needs to be making at least 4 deliveries an hour or you're losing money. That's not even really counting fo…
$15/hr plus tips plus mileage is overkill. Let's say you cut out the awful feature that is tipping and make it $15/hr plus mileage, which is a perfectly good wage. If I was previously paying $6-7 in fee+tip for a limited selection of restaurants, I'd be okay paying $10 for places that don't normally have delivery. If that means two trips per hour, and you're not in one of the ten worst cities for traffic in the entir…
You forgot wear and tear on the car, and gas. 15/hr is decent without additional expenses. Take out gas and tires and brakes and maintenance and it's poverty level.
Re: Doordash and Pizza Arbitrage
#223The real arbitrage opportunity is for a competitor to DoorDash to place orders through DoorDash, and pay the delivery person a small fee plus let the delivery person collect the DoorDash fee. You could scale this up to huge numbers.
Curious if doing so would survive a lawsuit. On the one hand, DoorDash could argue that it's unfair competition, but only by admitting that their deliveries are priced too low, which itself is unfair competition. I don't know how unfair competition is regulated.
Re: Doordash and Pizza Arbitrage
#224Very important note (near the bottom of the post) on why Doordash did what they did: > Note 1: We found out afterward that was all the result of a “demand test” by Doordash. They have a test period where they scrape the restaurant’s website and don’t charge any fees to anyone, so they can ideally go to the restaurant with positive order data to then get the restaurant signed onto the platform.
It doesn't fully explain why they priced a $24 pizza at $16. I wouldn't be surprised if they're subsidizing purchases, but just skipping fees doesn't explain that.
They are taking a loss on every order, but they are hoping to make up for it with volume.
Re: Doordash and Pizza Arbitrage
#225I 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.
> Works fairly reliably in supermarkets
No it doesn’t.
Not just because they can be badly calibrated, but also because the range of weight they have to deal with must make it hard to manage any sane range.
The only SCO I’ve seen doing a decent job at dealing with weight use a binary check (“was there any product at all added to the to total weight of the basket ?”) and they still miss products like lollipops or anything too light to pass the range.
Sure much more reliable system could be built, especially at Amazon’s engineering scale. But so far supermarkets are mediocre at best at this game.
Re: Doordash and Pizza Arbitrage
#226Earlier 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.
Meanwhile, door dash never asked for the restaurant to participate in the "promotion," so screw them... They are offering to deliver boxes of dough at deathly inflated prices, with no other agreements with the restaurant. How is taking advantage of that "service" fraud?
Re: Doordash and Pizza Arbitrage
#227Earlier quoted context omitted.
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.
Not if the customer ordered plain pizza dough
Re: Doordash and Pizza Arbitrage
#228Earlier quoted context omitted.
Usually gets your Uber account terminated or not able to sign up in the first place with a prepaid.
Hopefully not a problem with small businesses?
It does become a problem depending on their POS vendor deciding to flag prepaids, I've seen several dislike this because of the ability to modify transactions afterward / tip or something of the sort, for the restaurant industry.
Re: Doordash and Pizza Arbitrage
#229Interesting. I always suspected this to be true but not the extent, especially the overall profits generated by food delivery cos. For e.g. one of India’s largest delivery co reported a loss that was double the revenue! [1]
The other way to look at this is to think of it as a global capital transfer mechanism, from the super rich to the “real” economy. Sure, it is not sustainable in the long run but while it lasts there is significant transfer of capital which appears difficult to otherwise do, thanks to resistance to capital taxes. I really do not know what to make of the incentives for fraud though.
1 - https://yourstory.com/2019/12/foodtech-startup-swiggy-loss-r...
Re: Doordash and Pizza Arbitrage
#230I 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…
But Amazon isn't intentionally trying to lose money here.