Hold on now, Domino’s is doing just fine. On a tear actually.[1]

[1] https://www.fool.com/investing/2018/07/19/dominos-pizza-exte...

(If that sounds funny, read up on how Domino's has improved customer sat regarding their pizza quality in the past few years. It's a great case study, incl. how to do marketing when your brand is in the dumps.)

So Domino's provides the backend support + marketing + development and for that it gets a hefty fee from whoever attaches Domino's flag to the location.

The model is sufficiently different enough to make it extremely viable, and perfectly scalable for the smartphone era.

Most restaurants typically have a mostly fixed menu. Munchery varied the menu daily.

I can't say what Munchery was paying its drivers, in a traditional restaurant or through the bullshit gig companies, driver typically make at or below minimum wage.

Most traditional restaurants farm out their site (e.g. bullshit gig companies will handle the photography and pay the photographers a pittance) or have a minimal online presence. Munchery had the overhead of maintaining much more of their online presence.

That said Munchery wasn't real-time delivery when I used it. There was an ordering window that closed by mid-afternoon. If I had to guess the constantly rotating menu created a ton of waste. Or maybe they were simply that bad at it.

That's your problem right there. The Bay Area is not dense enough to make this viable.

like the meal kit companies, anything you can do from a centralized site the local companies, home grown or franchise, can do as well. both restaurants and grocery chains co-opted the idea of meal kits and then had the built in neighborhood loyalty.

This is the big thing. I can walk into a Stop and Shop or an ACME or a Shopright and buy a meal kit on my way home, and they usually have a decent selection. They aren't gormet, but they are fit for human consumption ;).

I can just throw it all into a skillet, saucepan/pot, or an instant pot and have it done in 30 minutes without chopping/dicing/slicing.

this selection contains the answer to your question: all those cuisines's recipes use few ingredients in a lot of variations and have preparations that can easily sit waiting for a customer.

it's harder to find restaurants or other places with large or daily menus that can sustain a structured delivery chain as primary income source, maybe they can support the more unstructured uber food aproach but usually that's it. exceptions apply, but parent listed a good deal of causes why this is capital inefficient.

these startups are trying to create a "microcatering" market, which is radically different.

1) Pizza is made on demand, quickly, from a small number of relatively non-perishable, cheap ingredients. You won't throw away a significant dollar value of raw materials. Also, pizza is popular, and your delivery drivers can stay busy. Pizza is so suitable for delivery that it's the ur-example.

2) Indian does have long lead times (the sauce cannot be made on demand), but the core food item is rice (which can be made in advance in bulk, and is also very cheap), and sauce, but the way the restaurant works is they make up a small number of sauce bases, cook up some meat, and then combine when the order is made. You don't necessarily know how much butter chicken will be ordered in a night, but you can cook batches during the night to adjust to demand.

3) Thai, around here, is always run out of an existing successful Thai restaurant, so they can piggy-back off the volume of the restaurant. It also tends to be a bit pricier, probably to reflect the higher margins. It also tends to centre around stir-fry, which again is cooked mostly on demand from a small-ish number of prepared ingredients.

4) Sushi...not popular around here (sushi is, but there is ZERO delivery options), but sandwiches, mexican, and turkish kebabs are. Again, you can get a bunch of cheap bread, tortillas, or pitas, a small number of mostly cheap, mostly non-perishable, mostly interchangable ingredients, and churn out chicken quesadillas, beef burritos, etc. Leftover bread is a small cost, and if you're careful you can minimise loss of meat, as you prepare more batches over the night.

5) Fish and chips (very popular around here), made from frozen ingredients and a VERY small selection of fresh ones, deep friend on demand.

See a pattern? A lot of "combine cheap starch with some fresh vegetables and/or meat that can be prepared quickly, ideally from frozen", where in many cases on-demand labour (putting the sandwich together, putting toppings on the pizza) will be a major chunk of your inputs, and ingredients will be minimal. In all cases you're looking at cuisines where it's relatively popular, the ingredients are relatively cheap, and critically you have a lot of interchangeability, a small number of ingredients, and low preparation times, etc. The fish and chip shop doesn't care if they sell 80 scoops of chips or 40, they've got tons spare in the deep freezer, and they're being cooked on demand; no wastage. Their main concern is just selling enough of anything to cover the cost of the oil in the deep fryer.

What will NOT work is something like a steak, roasts, ribs, fancy fish; stuff that has expensive ingredients and (especially) long lead times. You can't just cook up 40 plates of ribs on spec to see if you'll sell any tonight. (Well, not and stay in business for long.)

And if we look at the screenshot of Munchery's menu, item 1 is Corn Husk Roasted Salmon, item 2 is Honey Glazed Pork, item 3 is a side, item 4 is Roasted Chicken. These are the exact sorts of thing that will wreck your economics. No doubt they were popular; people are sick of pizza, indian, thai, mexican, etc as delivery options, especially at $11 a plate! But as the joke goes, if you lose money on every sale, you can't really make it up in volume. :)

Edit: Munchery tried to work around this by closing orders early, I think at 2pm, but 1) that's going to lose you some volume and 2) that's still not enough lead time.

> why are all pizza, Indian, Thai, Sushi etc. places in my city doing this

They're doing something very different.

I don't buy this explanation. I can easily get roasted chicken, honey glazed pork, salmon, bbq ribs and a ton of other 'complex' dishes delivered with no fuss and for similar prices. Pizza, thai etc are popular because, well, people enjoy the food. There is nothing radically different about doing other cuisines, except messing up logistics or not meeting consumer demand...

The winners are going to be giants like Amazon that can absorb zero or negative real margins and can play a very long game until vehicle improvements (automation + electric) cuts into the delivery cost (and or they'll just find a way to bundle in other products/services to produce a broader profit).

Even Amazon gave up on paying me to deliver groceries to my home. They would have a guy in a deli in New Jersey (~200 miles away) slice ham and turkey cold cuts in the middle of the night, and deliver via USPS by 7:30AM. Truly a marvel of modern logistics, except they couldn't figure out how to not put big cans of olive oil on top of eggs or bread.

We probably got an average of $50/week in refunds.

All have been in business for years (at least around 2010) and most longer. I would not be supersized if they are quite profitable.

If you can outsource your driver to somebody like Deliveroo or Uber Eats, even better ...

The problem with cooking anything on demand is that scaling up distributed cooking doesn't work well while preserving quality. If you want cheap, you get fast food, and if you want expensive, you have a quality cafeteria.

1 - ordering closes (closed?) at 2pm.

2 - I generally ordered Sunday night / Monday am for the coming week: 2 meals for 2 people each.

3 - with price increases over the last 18 months, they're pretty price comparable to delivery. I have a hard time believing there's no gains to having an industrial kitchen rather than a storefront, and from closing ordering at 2pm.

Also, Munchery charged $7/delivery, and I tipped $5. So they should have been breaking even at 3.6 deliveries/hour, assuming your $25/hr number...

30% waste on meat will kill your business.

If you look at some published data from a while ago, Blue Apron has 15% user retention after one year, Hello Fresh 11%.

As a consumer, at first might sound a good idea and convenient to order pre-made food you don't have to cook but soon you realise it gets quite expensive compared to just get your groceries delivered and cook.

I don't know in the US, but in Europe for an average family of 3/4 members using meal kit companies is bloody expensive in the long run and you can't even get meals for the entire week.

Also if you get 2/3 meals a week, then you have to shop for the remaining days and you inevitably end up wasting food.

Personally, I don't event think you can compare meal-kit companies with the likes of UberEats or Deliveroo. The latter can reach economies of scale far more easier than the former.

I have tried many of the meal box companies and the real problem is quality. The food quality is usually not high and the recipes are basic. I imagine that even novice, unskilled cooks will realize after a couple of months that they don't need the box.

Maybe that's a good thing and something that these companies should push for? Maybe they already do? Sell it as a service for three months, one up front price, one'ish meal a day that you prepare and cook with the idea that this is a learning activity rather than following strict directions or assembly. As you move further through your cooking education the meals become more complex. I would think you could charge more for this while having better/more ingredients and having a smaller customer base.

The total possible market that meal kit companies can extract value from is very small - it is not only people who have more money than they have time and people who do not know how to leverage money to get others to do the entire process for them.

This is definitely true in the US as well, even in areas with slightly higher prices for groceries in which meal-kit companies still charge their normal prices. You could eat out and get a main dish in one of a variety of restaurants in any city in the US for the price of the meal-kits I found.

Delivery is expensive, so these services are out of reach for your average consumer. However, when you think about it, the people most likely to get a ton of value from prepared foods are people most likely to have a busy job where they make a higher wage than the average consumer.

Additionally, user-retention metrics in weekly subscription services can be misleading. If you're still ordering 52 cycles after signing up, you're likely a whale for the service.

- Limited meal customization. Want to order an item minus the mushrooms? Too bad, since the meals are prepped ahead of time.

- Limited inventory throughout the city. Have you ever not been able to order your favorite dish off Postmates because it was sold out? On demand apps have this problem every night.

Source: Worked for an on demand food delivery company.

I'd say that's just how the food business works. A big part of running a restaurant, a food stall, or even a supermarket is to forecast how much food you're going to sell on the day and thus how much supply you need to buy.