Uber started out well as your "personal chauffeur" with premium cars and polite, professional drivers. Then they started chasing numbers and valuation, and it was all downhill from there.
Is the Ride over for Uber?
31–40 of 304 posts
Re: Is the Ride over for Uber?
#32Earlier quoted context omitted.
What economies of scale? Their primary expenses, workers, are fixed cost.
Quoted post unavailable.
People care a lot more about timeliness for their hot food and their own person than they do for a box that UPS delivers. Uber has been trying to make that particular economy work for nearly a decade now, and it turns out it's niche.
Re: Is the Ride over for Uber?
#33The problem with Uber Eats is exactly the same as the problem with Uber's rideshare: there's no difficult-to-copy element of it. It's been clear for at least seven years that it's easy to spin up a food delivery service, just the same way it's easy to spin up a rideshare service. The basic technology is something a small team can conjure up out of nowhere in a few months, the two sided marketplace is heavily incented…
Let’s say there was just 1 delivery service. Could they charge enough delivery fees to actually build a sustainable business? How much fees would you need to charge? $4/delivery means having to make a delivery in 15 mins to be able to pay the delivery person minimum wage. Plus Uber’s profit, plus the cost of the car and maintenance expenses + tickets, accidents, etc, It’s hard to see how a monopoly can also make mone…
Though they also get a 30% cut of the food price, so that considerably changes the economics.
Re: Is the Ride over for Uber?
#34Re: Is the Ride over for Uber?
#35The problem with Uber Eats is exactly the same as the problem with Uber's rideshare: there's no difficult-to-copy element of it. It's been clear for at least seven years that it's easy to spin up a food delivery service, just the same way it's easy to spin up a rideshare service. The basic technology is something a small team can conjure up out of nowhere in a few months, the two sided marketplace is heavily incented…
Let’s say there was just 1 delivery service. Could they charge enough delivery fees to actually build a sustainable business? How much fees would you need to charge? $4/delivery means having to make a delivery in 15 mins to be able to pay the delivery person minimum wage. Plus Uber’s profit, plus the cost of the car and maintenance expenses + tickets, accidents, etc, It’s hard to see how a monopoly can also make mone…
I think that if there was just one delivery service, they could absolutely make a good business.
Now, I mean, would it be a good business that was used by 80% of the population multiple times per week? No. As you point out, it's intractably expensive. But there's nothing wrong with a business that sells a relatively expensive luxury, and it's not sooo expensive to have a meal delivered that only a tiny fraction of the population would ever use it.
Re: Is the Ride over for Uber?
#36The problem with Uber Eats is exactly the same as the problem with Uber's rideshare: there's no difficult-to-copy element of it. It's been clear for at least seven years that it's easy to spin up a food delivery service, just the same way it's easy to spin up a rideshare service. The basic technology is something a small team can conjure up out of nowhere in a few months, the two sided marketplace is heavily incented…
Food delivery also isn’t very practical in developed country markets without a huge increase in productivity vs labor costs. It’s just too expensive compared to a country like China where it is cheap enough to be ubiquitous. Automation could be disruptive here…someday in the form of food delivery land and/or air drones. It really is the same with ride share: it just isn’t economical considering how much human labor i…
Food delivery is practical, mainstream and has been for 40+ years in the West.
It works great "inhouse". They tend to know all their regular customers and area and know exactly how to get there, where to park, which bell to press etc. They will also know if there is bad traffic or an accident closing a major road and adjust wait times and order frequency accordingly.
The person that runs the delivery joint can also wait until he knows his/her driver will be making his way back, and only start cooking then, so the next order doesn't get cold waiting for a pickup.
It all goes to shit when you put a tech platform which has absolutely no real interaction with the kitchen and outsource the riders entirely, with virtually no quality control and no local knowledge. Plus they also want to take 30-50% commission for the privilege.
Ubers margins are comically bad. Uber Eats did $13bn of revenue and they made $30m of EBITDA - 0.2%. The credit card networks are probably making 10x the money that Uber on each order. And that EBITDA will be with them pulling out all the stops now they have realised they need to get profitable fast.
Re: Is the Ride over for Uber?
#37I was on work travel last week. No Uber from the airport - three cancelations then I caught a Lyft. It was over $500 for a 50 mi ride to a neighboring city which I was mostly looking at out of curiosity. My friend was recently held up (well, attempted) by an Uber driver in Nashville who had canceled last second so he could not even find who the driver was to file a complaint. It seems like the former gap in user expe…
Counter point:
I just got rejected for a short ride from a cab at the airport in nyc. Dude was very angry I was only going a few miles. Hopped out, ordered a Lyft, got a great ride from a dude with a wife and kids.
Re: Is the Ride over for Uber?
#38No post body was provided.
Re: Is the Ride over for Uber?
#39The problem with Uber Eats is exactly the same as the problem with Uber's rideshare: there's no difficult-to-copy element of it. It's been clear for at least seven years that it's easy to spin up a food delivery service, just the same way it's easy to spin up a rideshare service. The basic technology is something a small team can conjure up out of nowhere in a few months, the two sided marketplace is heavily incented…
It's typical "bait and switch" and that's why it simply doesn't work out in the long run...
A company starts a web site and sets pricing on their service at a very low rate, while subsidizing it's financial loss with investment money at a loss. The company gradually increases costs and pricing over time for suppliers, employees, and on users until it finds a sweet spot in hopes that no one will notice, while also protecting itself carefully with PR and legal moves and careful management of overhead costs for operations... Most often the company manages minimal customer support, insurance, lawyers, a web site, marketing teams, and an office of public affairs, and that's the primary focus.
Often times, ownership frequently funnels profit out through selling shares, and though executive pay, until eventually the company succeeds or fails miserably.
These are not commendable business ventures like the press would have you believe, they're time sharing schemes that victimize almost everyone who invests in them, and they undermine vital services that would normally be regulated like the taxi cab industry, which was doing quite well before Uber came in and scorched it to ashes.
Many cities gave ride share companies huge subsidies and concessions to operate, few of which benefits they've passed on to drivers and riders, and surge pricing is about as scandalous and opportunistic as monopolizing a river then selling the water to the villages it used to lead to. I wouldn't be surprised if these companies are also pushing campaigns and lobbies against individual car ownership as well through employees, and brigading in places like reddit, because that only furthers their death grip on monopoly status.
The corporate world is wildly toxic these days, I'm skeptical of everything companies tell me because everyone is opportunistically dictating prices and terms, and they've abandoned customer service and all of the principles the present at orientation behind the scenes.
Re: Is the Ride over for Uber?
#40The problem with Uber Eats is exactly the same as the problem with Uber's rideshare: there's no difficult-to-copy element of it. It's been clear for at least seven years that it's easy to spin up a food delivery service, just the same way it's easy to spin up a rideshare service. The basic technology is something a small team can conjure up out of nowhere in a few months, the two sided marketplace is heavily incented…
Food delivery also isn’t very practical in developed country markets without a huge increase in productivity vs labor costs. It’s just too expensive compared to a country like China where it is cheap enough to be ubiquitous. Automation could be disruptive here…someday in the form of food delivery land and/or air drones. It really is the same with ride share: it just isn’t economical considering how much human labor i…
>Food delivery also isn’t very practical in developed country markets without a huge increase in productivity vs labor costs.
But pizza and chinese delivery was a thing in the US long before delivery apps were a thing. Clearly it was practical at some small scale in the US. I don't see any reason why it can't be expanded to other restaurants (eg. by sharing delivery drivers so a restaurant doesn't have to have an entire FTE on payroll).