Exactly. There isn't a billion dollar market to tagging $5-10 on each Five Guys order for a 30-75 minute delivery. I order food delivery from these places about twice a month, and almost never pay anything, due to competitive pressure. End of the day, I'm never, ever paying $10 to get $20 of burger delivered.
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.
Re:Munchery Shuts Down
by beaconstudios on Tuesday January 22, 2019 @08:37AM
(#18968111)
basically the model is operate at a huge loss subsidised by investors until you can monopolise, then start vertically integrating and increasing prices. It's like if an Indian takeaway took a $MM loan to buy out all the other Indian takeaways in the area and then doubled the prices everywhere. The "tech" angle is just putting a happy face on monopolisation and price gouging.
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).