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UberEats could be underpaying delivery drivers on 21% of trips

businessinsider.com

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Re: UberEats could be underpaying delivery drivers on 21% of trips

#81

Post by lotsofpulp »

barkingcat wrote: post #47
AlexandrB wrote: post #35

Earlier quoted context omitted.

> It's like Uber are trying to shoot themselves in the foot with all the cost squeezing and profit seeking at the same time they're in a fundamental fight defining what they are. I don't think they have a choice. UberEats is fundamentally unprofitable. If it was run profitably, the high(er) prices would drive a large portion of their customers away and into the arms of other "startups" willing to run at a loss or tow…

I can imagine a UberChef where an Uber driver gets an order, and drives a freelance Chef to a freelance kitchen where the chef cooks the food (groceries provided by an uber shopper who can also get one-off ingredients from specialty stores), the chef cooks the food to order (steak, medium rare, or seafood boil for a party of 2, etc) - and then uber driver delivers the food.

If you’ve ever managed a food business, this is unimaginable.

Re: UberEats could be underpaying delivery drivers on 21% of trips

#82

Post by cortesoft »

iso1631 wrote: post #62
ab_testing wrote: post #54

Earlier quoted context omitted.

COVID-19 is like the golden age of food delivery. If these food delivery apps are not profitable now, they will probably never be profitable. When the severity of COVID subsides in a few years, people will like to go out to eat again rather than have it delivered.

The only reason I could think of to use something like ubereats, deliveroo, justeat, etc would be if I wanted a non-pizza delivered while I was staying in a hotel in a strange city somewhere. If I'm at home I'll look at the menu of my favourite indian/chineese/whatever place, phone them up, and they deliver it as they have done for decades. I've spent two nights in a hotel since March, normally it's 70 a year. One ni…

I get so frustrated when people act like these food delivery services aren’t a WAY better user experience than the old version of having to call for delivery.

So many times, I will be super busy with the kids, or work, or housework, and I will just pull up DoorDash with one hand (while the other is feeding a hangry 1 year old) and hit ‘reorder’ on one of my past meals. Literally 15 seconds and food is on the way.

Compare this to having to call someone, wait on hold, give my phone number/address, tell them my order, correct the mistakes, find my wallet, get out my credit card, give them the number, confirm the number and expiration and security code, then sign a paper copy with the tip when the driver drops it off.

Can I do the old style of delivery? Sure, but man it is a lot easier now.

Re: UberEats could be underpaying delivery drivers on 21% of trips

#83

Post by selestify »

lotsofpulp wrote: post #81
barkingcat wrote: post #47

Earlier quoted context omitted.

I can imagine a UberChef where an Uber driver gets an order, and drives a freelance Chef to a freelance kitchen where the chef cooks the food (groceries provided by an uber shopper who can also get one-off ingredients from specialty stores), the chef cooks the food to order (steak, medium rare, or seafood boil for a party of 2, etc) - and then uber driver delivers the food.

If you’ve ever managed a food business, this is unimaginable.

Why?

Re: UberEats could be underpaying delivery drivers on 21% of trips

#84

Post by Jasper_ »

supernova87a wrote: post #59
zadkey wrote: post #50

Earlier quoted context omitted.

The biggest reason I would say that the drivers are not independent contractors is that they are not allowed to set their own rates. Uber's argument that they are not employees is based on the concept that they only a platform facilitating a connection between drivers people who need rides or in this case deliveries. But if the contractors are truly separate entities, then Uber by controlling the cost of the ride/del…

Wouldn't Uber's argument about this be that drivers do get to set their rates by the platform showing them and matching them with jobs that are at a rate they accept? Just because they can't put out a published $ figure on their desired per job rate, doesn't mean they're not setting their own rates that they accept?

Uber Pool functions so that drivers automatically getting more and more riders added to their trip, without any way for them to reject passengers. I've been told stories of drivers getting 20+ pool rider chains in a row, without any option to take a break.

Re: UberEats could be underpaying delivery drivers on 21% of trips

#85

Post by et-al »

rrrrrrrrrrrryan wrote: post #51
AlexandrB wrote: post #35

Earlier quoted context omitted.

> It's like Uber are trying to shoot themselves in the foot with all the cost squeezing and profit seeking at the same time they're in a fundamental fight defining what they are. I don't think they have a choice. UberEats is fundamentally unprofitable. If it was run profitably, the high(er) prices would drive a large portion of their customers away and into the arms of other "startups" willing to run at a loss or tow…

I wouldn't go so far as saying they're "fundamentally unprofitable". They have a couple long-term options: the often-discussed one is autonomous driving (though it's becoming increasingly obvious this is many years out), but the less discussed one is vertical integration. It's not hard to imagine them choosing to pursue Amazon-style vertical integration where they own the "restaurants" themselves. I put "restaurants"…

> If UberEats can really squeeze both the drivers AND the restaurants, there's no fundamental reason that food delivery can't be done profitably - pizza companies have been doing it in almost all markets for decades.

Pizza delivery is profitable because they sell cardboard and depend on teenager drivers relying on their parent's auto insurance.

Anyone who's actually looked at the person delivering their food would have thought twice about the margins in food delivery. To spell it out: food delivery is often performed by immigrants with few choices for under-the-table work. The margins are thin-to-none. The current system has worked because no one's investigating the thousands of independent restaurants.

Now tech companies are trying to do the same thing, but multimillion dollar corporations have a harder time hiding their labor exploitation from the public.

Going back to ryan's point, I agree that with full vertical integration (dirt cheap ingredients and centralised factory kitchens), food delivery could be profitable, but at what point is one just selling frozen food from a microwave/oven in the back of a car?

Re: UberEats could be underpaying delivery drivers on 21% of trips

#86

Post by zepearl »

rrrrrrrrrrrryan wrote: post #51
AlexandrB wrote: post #35

Earlier quoted context omitted.

> It's like Uber are trying to shoot themselves in the foot with all the cost squeezing and profit seeking at the same time they're in a fundamental fight defining what they are. I don't think they have a choice. UberEats is fundamentally unprofitable. If it was run profitably, the high(er) prices would drive a large portion of their customers away and into the arms of other "startups" willing to run at a loss or tow…

I wouldn't go so far as saying they're "fundamentally unprofitable". They have a couple long-term options: the often-discussed one is autonomous driving (though it's becoming increasingly obvious this is many years out), but the less discussed one is vertical integration. It's not hard to imagine them choosing to pursue Amazon-style vertical integration where they own the "restaurants" themselves. I put "restaurants"…

>It's not hard to imagine them choosing to pursue Amazon-style vertical integration where they own the "restaurants" themselves.

I always wondered something about those meals that are available on airplanes:

in the past I liked quite a lot most of them (e.g. a small piece of meat/fish/other, some vegetables and/or rice, a slice of bread, a small dessert) => wouldn't it be quite profitable to have a similar delivery service for "kits/menus" like those ones (just e.g. ~4 different "kits" available to be ordered daily), cold (but pre-cooked if needed) that only need to be warmed up at home? (if 3 stewards/esses, on a moving tube, managed to warm that up for 300 people then I guess that I'll manage to do the same for myself at home)?

I admit that on one hand the "delivery"-part of the service would be related only to getting fresh (uncooked or "freshly pre-cooked") stuff (not ready for consumption), but on the other hand that way the delivery could be spread over a longer timespan (multiple deliveries per trip, better delivery organization, therefore less costs) and could be left in the mailbox (assuming at least a mediocre insulation of the package).

Here in Switzerland/Zurich I am aware of some similar services, but they deliver only the ingredients (then I would still have to actively cook). Supermarkets do have some similar pre-cooked stuff, but most (not all, but most) is quite terrible (probably because there the stuff has to be able to lie there for days/weeks - definitely not similar to what I used to eat on airplanes) and especially it never changes.

(I used to fly only in Europe using "Swiss", "Air Berlin", "Lufthansa", maybe as well "KLM"/"Air France", always to/from Zurich - your experience with other airlines / in other location might be different)

Woudln't it be nice to get back home and find in the mailbox a ready-to-be-warmed-up (maybe actually "cooked", but in an extremely simple way) menu?

The delivery, being all sourced from the same place and being spread over many hours would not be as expensive as it is currently done for hot stuff coming from multiple restaurants, and the small amount of different menus (4 as mentioned above or slightly more) would allow to buy more source material for less $.

EDIT: I admit of not having any clue how the companies that prepare meals/menus for airlines operate => there might therefore be some important details that make the whole concept crumble... :)

Re: UberEats could be underpaying delivery drivers on 21% of trips

#87

Post by vkou »

selestify wrote: post #83
lotsofpulp wrote: post #81

Earlier quoted context omitted.

If you’ve ever managed a food business, this is unimaginable.

Why?

Because any food business already has insanely tight margins, and operates incredibly efficiently.

The scenario proposed by the grandparent poster adds so much waste and slack and overhead in the system that the family-owned-and-operated Thai kitchen on Main St. will eat Uber's lunch, and the Dominos franchise two doors down from it will pick through its bones.

Re: UberEats could be underpaying delivery drivers on 21% of trips

#88

Post by lotsofpulp »

selestify wrote: post #83
lotsofpulp wrote: post #81

Earlier quoted context omitted.

If you’ve ever managed a food business, this is unimaginable.

Why?

Food business is laborious, hard work that needs to be done at undesirable times (when others are out enjoying themselves). It’s hard enough to find quality workers via humans, I find it hilarious that one would be able to do it via software.

It’s also a high liability business, especially when dealing with animal products.

Not to mention prepared food is barely affordable for the vast majority even with the tiny margins that exist today, so the only people who would be able to afford such an on demand personalized chef service surely could just afford their own chef?

Re: UberEats could be underpaying delivery drivers on 21% of trips

#89

Post by Balgair »

cortesoft wrote: post #82
iso1631 wrote: post #62

Earlier quoted context omitted.

The only reason I could think of to use something like ubereats, deliveroo, justeat, etc would be if I wanted a non-pizza delivered while I was staying in a hotel in a strange city somewhere. If I'm at home I'll look at the menu of my favourite indian/chineese/whatever place, phone them up, and they deliver it as they have done for decades. I've spent two nights in a hotel since March, normally it's 70 a year. One ni…

I get so frustrated when people act like these food delivery services aren’t a WAY better user experience than the old version of having to call for delivery. So many times, I will be super busy with the kids, or work, or housework, and I will just pull up DoorDash with one hand (while the other is feeding a hangry 1 year old) and hit ‘reorder’ on one of my past meals. Literally 15 seconds and food is on the way. Com…

Not to trivialize your experiences (toddlers are not easy), but for me, the list you give isn't all that much of a barrier. Yes, it is simpler to use the app, but not all that much more. Also, where I am, they take the credit card at the door, not over the phone. Most use a Square-style card reader attached to a work phone, even the mom-n-pop delivery, even now in the pandemic (they use gloves mostly).

Re: UberEats could be underpaying delivery drivers on 21% of trips

#90

Post by lotsofpulp »

jacquesm wrote: post #44

Middlemen are always going to try to increase their take on both sides. It is the only way they can grow the profitability of their business because they can't add more value, they can only subtract.

Middlemen’s value is usually in their ability to save time for the buyer.

Costco is valuable to me because it saves me time from having to research products and supply chains. I could go to aliexpress.com, but I don’t because I’d rather spend my time in other ways.

If I land in a foreign country, I could spend time researching taxi companies, or I can save time and pay Uber/Lyft a premium if I already trust them.

As a seller, a middleman (or broker) can save me time by discriminating against buyers I don’t want to waste time entertaining.

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