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Five companies now control over 90% of the restaurant food delivery market

marketsaintefficient.substack.com

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Re: Five companies now control over 90% of the restaurant food delivery market

#111

Post by folkrav »

astrange wrote: post #88
koakuma-chan wrote: post #35

Earlier quoted context omitted.

And why is a large monopoly a net negative? I read his book and he says that monopolies are 10x better products, and if monopolies are 10x better then why are they bad? Are you arguing that it would be better to keep using 10x worse products, for the sake of there not being any monopolies?

Five companies in an industry isn't a monopoly. That's very competitive actually.

How? Do these 5 companies even operate in the same places? Around here we have DoorDash, Uber Eats, and that’s pretty much it. We have SkipTheDishes, which was present before the other two outside urban areas, but I don’t even bother talking about them, most restaurants in the area have switched away from them. The other alternatives just never existed outside highly urban areas or have simply been pushed out by the bigger players. Where are the effects of this highly competitive market, exactly?

Re: Five companies now control over 90% of the restaurant food delivery market

#112

Post by blibble »

mrweasel wrote: post #6

One of those companies are available where I live, and I'll never use them, because they make my pick ups insufferable. I have kids, and can see McDonalds from my bedroom window, so I have more McDonalds points than I care to admit. Wolt is pissing me off every time. The amount of time the McDonalds staff needs to dedicate to Wolt staff is insane. They could easily serve twice the customer in resturante/drive-through…

I don't see the attraction of these apps either

the food arrives lukewarm, in a smaller portions and costs more

in addition their widespread use hurts the restaurants you like

and drives down wages for society, because the only people who can live on what they pay out to the drivers are illegal immigrants paying zero tax (with the state paying for room and board)

it's all negatives

Re: Five companies now control over 90% of the restaurant food delivery market

#113

Post by fasterik »

budududuroiu wrote: post #108
fasterik wrote: post #106

Earlier quoted context omitted.

Anti-trust for an industry where there are at least five companies doing well in any given space? That's not called a monopoly, it's called competition. Edit: I wasn't accusing everyone who is critical of tech of being a Luddite. The attitude that nearly every tech company is a net negative for society goes quite a bit beyond criticism.

You read an article that talks about consolidation of food delivery and increasingly high barriers to new entrants and think that’s competition?

Where does the article mention barriers to entry? My reading is that that the consolidation is due to venture capital moving investment to other areas. Anyone who wants to start a new food delivery app is still free to do so, as long as they can find funding.

This is the definition of competition according to Wikipedia: "Competition is a scenario where different economic firms are in contention to obtain goods that are limited by varying the elements of the marketing mix: price, product, promotion and place."

Yes, sounds like competition to me. Network effects are not anti-competitive.

Re: Five companies now control over 90% of the restaurant food delivery market

#114

Post by drivingmenuts »

TylerE wrote: post #85
sroussey wrote: post #48

Earlier quoted context omitted.

It is also weird that there isn't a company with 2/3 of the market. Eventually it will happen i guess.

Sysco is probably pretty close if you ignore the extremes of the market.

While Sysco is a monopoly, they apparently don't make anyone angry enough to get rid of them. My guess is that they are pretty even-handed across an entire industry and their customers are knowledgeable enough to not screw up a good thing when they see it.

Re: Five companies now control over 90% of the restaurant food delivery market

#115

Post by jonator »

hn_throwaway_99 wrote: post #11

This is essentially the story of tech companies across nearly every industry where they have come to dominate. This is one reason that I see most tech companies as essentially a net negative for society at large, as the goal is nearly always to control a large monopoly (and this is fully admitted by many tech leaders, e.g. Thiel) which the Internet makes possible. Pre-Internet you would see the same dynamics, but usu…

Capitalism does facilitate monopolies or industries with razor thin margins like airlines. However, the space of competition is a revolving door with constant opportunity to create something better (that people want) than the established players or to enter a new arena entirely. Ultimately, since consumers are the choosers, it works in their favor. It was the consumers that wanted these companies to exist, and the profits are a proof of that.

However, sometimes there are unpriced externalities like the competitive advantage of removing your own manufacturing waste by dumping it into a stream. That is where governance (whether self or the state) comes in.

Re: Five companies now control over 90% of the restaurant food delivery market

#117

Post by pbh101 »

folkrav wrote: post #111
astrange wrote: post #88

Earlier quoted context omitted.

Five companies in an industry isn't a monopoly. That's very competitive actually.

How? Do these 5 companies even operate in the same places? Around here we have DoorDash, Uber Eats, and that’s pretty much it. We have SkipTheDishes, which was present before the other two outside urban areas, but I don’t even bother talking about them, most restaurants in the area have switched away from them. The other alternatives just never existed outside highly urban areas or have simply been pushed out by the…

Without more context this is silly to say. It isn’t as if we know the natural or correct construction of this market a priori and that 5 is clearly a distortion from that. Consolidation can sound bad in the abstract but in this relatively immature market you could still expect major shifts to get to a steady state. Just a little bit ago people were remarking on VC-subsidized delivery; as that goes away, consolidation is not unreasonable.

Edit: ‘this’ in the original parent comment was along the lines of ‘five out of potential thousands of actors’

Re: Five companies now control over 90% of the restaurant food delivery market

#118

Post by Yeul »

Workaccount2 wrote: post #62
esco27 wrote: post #28

The food industry is due for a good old opensource disruption, where each restaurant can setup their private menu hub (like you would an instagram account), add their payment processing details, and start delivering their own orders. It's a win-win for the restaurant and their recurring customers.

Worked years ago at a restaurant that had its own website and app ordering... Ubereats and the like still dominated the orders even with the 15% upcharge and even after notifying repeat customers that they can save money ordering direct The convenience of having one centralized app with one account that can summon any food from any restaurant in a 10 mile area is just way too strong.

Yeah I sometimes go to the restaurants own website but to be honest I'm often too lazy.

But I only order food once or twice a month- it's a little indulgence for me.

Re: Five companies now control over 90% of the restaurant food delivery market

#119

Post by pico303 »

daedrdev wrote: post #23

I think the truth is restaurant food delivery is a luxgury good, literally “private taxi for your burrito” yet many people spend like it isnt.

I thought the headline was implying something else. When I read the article, I thought, “Is it a monopoly to worry about if you can just do it yourself?” Feels like complaining there is a monopoly on services to pour you a glass of water from the tap.

Re: Five companies now control over 90% of the restaurant food delivery market

#120

Post by Yeul »

asdf6969 wrote: post #59
b112 wrote: post #27

Earlier quoted context omitted.

And yet, why do you need software? In the 80s, I delivered pizza with no software. The place had a normal cash register, for pickups. People would call, order, and we'd write it down. They it'd go on a wire with a clothes pin, until made. Then it went with the driver. Each delivery was written down before leaving with it. This worked for decades for everyone in the industry, flawlessly, perfectly, without issue. Why…

Everyone hates calling and apps give customers a list of restaurants with menus to browse. Restaurants also do all of their in-restaurant management with software (why not paper? ask them idk) which I assume has some integration with the app. I can imagine some type of open protocol that lets them self-host an order service though, or at least an open solution that’s hosted by many providers and many separate apps. T…

I remember when McDonald's didn't have kiosks. Human interaction with a fast food worker is vastly overrated. Both sides hated it.
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