Difficult Business Model. Ordering from home has been a trend for some time that was accentuated by Covid. 3rd Party Delivery Apps take a 20 to 30% commission, charge a service fee and a delivery fee. They are in actual fact a channel to market and the consumer isn't the restaurants customer. In reality they own the market place and the customer. Typically food is marked up 3 times. A 66% margin, deduct 30% for the Delivery, 5% for packaging and the fixed production costs like energy, staff rent etc. And there isn't much of anything left. A Buy One Free Offer {50% off} leaves the restaurant 1% to cover costs.
Bottom line is this 30% sustainable? Most people don't think so, but it doesn't look like prices are going to be driven down by competition, the 3rd Party Apps are still losing money and buying market share. Platforms are natural monopolies so it is difficult to compete with ones own deliveries etc. They are online businesses which means they need to be branded on line something alien to most restaurantiers. Branding is critical and if you ain't got a good differentiator you better have a good price.
It looks like the business model is here to stay though and restaurants are adapting to make it sustainable. Bottom line the consumer is prepared pay for the convenience, the drivers and restaurants are going to get squeased and in reality the industry is going to get controlled and owned by Gig Economy Multinational Corporates. Modern slavery.
