I Delivered Food To Find Out…Can These Apps Survive?
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- čas přidán 9. 05. 2024
- The revenue from the food delivery market in the United States is projected to reach $353 billion this year. But, somehow, none of the big names have ever been profitable. So where do they go from here?
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it's impressive how all are true:
1. the service is too expensive
2. drivers make too little money
3. the company is hemorrhaging money
4. restaurants get ripped off
Restaurants sign up to sell on the services. If they can't read the terms, that's on them.
@@mydogeatspukebut, like, everyone is losing?
race to the bottom!
@@mydogeatspuke if they don't sign up, their orders dry up.
Goes to show how much of a luxury getting a single meal delivered to you doorstep is.
I support the movement to end tipping entirely. Should be a voluntary reward for good service, not a replacement for pay. If a company can't pay its workers without making them beg their customers, it should NOT exist.
Even more so with preemptive tipping
Tipps replacing pay is just another way of capitalism abusing the good will of people. Everything must be exploited.
Props to the reporter. Doing the actual job, recording complicated pieces to camera with confidence… I see good things in her future in journalism.
I agree, this is what true journalism looks like, she's already a professional.
This is the kind of reporting we need.
She honestly didn't need to go out herself, she could have just interviewed a bunch of deliverers, but that is so much more interesting to watch.
She's Macy Gilliam, credited as the producer!
She didn’t show print reports of how in the red DoorDash is.
I remember a time when if your business didn’t make money, then you couldn’t have the business anymore.
That's because everyone was dirt poor and couldn't invest into innovation, and all the cool start-ups that exist today all around us couldn't raise money
Almost everything around us wasn't profitable for quite a while
The only reason that changed was because of the very low interest rates that began in the mid to late 2000's. This allowed companies access to enormous amounts of VC money. Amazon lost a lot of money for awhile, but to be fair the model could be made to work and they knew that from the beginning. That's not true with Uber or some others, and Uber has had to jack up prices in response. Now that interest rates are normal again (the current 5.25-5.5% interest rates on bonds and the circa 8% mortgage rates are normal by historical standards, even if on the high side), a lot of these companies are struggling to work.
Unless you are over 1000 years old i highly doubt that.
All failed ideas last a little while while they try and tweak it so it works. Had it not been for the shutdowns giving delivery a boost it would be no where near as common as it is now.
@@volodymyrhusak not true. Transatlantic trade, tons of projects, happened because there was gold to spend
Equally impressed and terrified of your ability to read a script while biking through a major city
you might have noticed that i did ~slightly~ clip a city bus at one point there, but mostly went well lol
Lmaooo @@MacyMorningBrew
As someone who identifies as a city bus, I do enjoy getting clipped sometimes
@@MacyMorningBrewI give you mad props for getting out there and living this story. As someone who has delivered for restaurants (by car in the burbs) for many years I could never see myself working for one of these companies. And in my opinion account renting is very big in NYC. Oh yea and being hungry while bringing other people their food is real.
@@MacyMorningBrew you did great! took risks but not too much.
This is wonderful modern journalism. Keep it up.
+
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garbage one sided reporting as usual.
@@ShovelShovel
And please enlighten us what the other side is? Who are the millionaires making money riding around delivering for doordash?
Well it’s not really reporting. It’s a girl on CZcams with a camera with no training lol
The basic problem here is that they’re trying to apply the pizza delivery model to all types of food, despite the fact that pizza delivery is built on a system that is designed to spread the delivery cost across many customers. I don’t think this model is, or ever was, feasible. And it’s so typical of that Silicon Valley mindset. Just fix everything with an app, right? Wrong!
RECURRING SUBSCRIPTION REVENUE DYUUUUDE!
Yeah to bad we don't allow companies to fail anymore.
and also that pizza is one of the cheapest and simplest foods there is. And compared to all the "fast" food it does not become inedible when being served luke warm / cold. I can not understand people ordering fries and burgers with these apps. I tried it once and it was all greasy/soaked and the luke warm to cold fries were horrible. And that basically at three times the price of mc donalds
Move fast and break things. Isn't that their moto? How's that working out there fellas?
@@BlackHoleOfTimeThese delivery apps are burning through the $ of investors who think they will end up the next Amazon. The "smart money" isn't so smart.
The fundamental problem is that paying someone to bring your food to you is expensive. If you don't want to pay, go pick it up yourself.
Or two words....saucepan and can of soup. Actually that's five. But soup and saucepan are two words.
This.
Or folks can cook at home.
Restaurants used to hire and manage their own delivery drivers. Customers didn't always have to pay.
Neither party wants to pay anything up front in this scenario. I imagine drivers would make substantially more if restaurants paid flat fees to these apps. Should cost them less considering drivers can be busy regardless of whether a single restaurant is getting enough orders.
If you put a middle man between the restaurant and the delivery person, it gets worse for everyone.
Who would have thought?!
Specialization is generally good, the market just needs a drought to sort itself out, but every time the tide starts to go out governments intervene to make sure no voters lose their jobs… at least not while their in office
Main benefit being that the digital infrastructure should, in theory, help make more efficient delivery. Not sure if it's working out in practice now though.
Living in Finland (home of Wolt and labour is expensive), the drivers/app would batch orders a lot more than what I see now (in Austria).
@@arildedvardbasmo490 ~ The thing that kills the whole app model is that the digital infrastructure takes people and money to run. That's more expense between the customer and restaurant, and the delivery people and the restaurant, which tarnishes the relationship between the customer and the delivery person.
We did successful deliveries for years without the apps in the middle, and things were fine. This is just another solution in search of a problem.
I delivered pizzas 35 years ago. We had no GPS, no apps, no credit cards; It was all done with landline phones, paper maps, and cash.
That's because of the point I made above. True entrepreneurs would perceive the truth about the situation, if value could be added by inserting a middle man. And if it was possible, what's the best process for achieving profitability? Obviously these deliver app guys are entrepreneurial poseurs.
I think it could be possible to add value, especially in a big city, by offering delivery service to businesses that otherwise would find it costly to maintain their own delivery services. But possible doesn't mean it works in practice.
You forgot to explore one side if the story - before these apps, restaurants were still making deliveries and we're profitable. The customers were getting their meals and the riders were making at least minimum wage. Everything was fine till these apps came and fixed something that wasn't broken. Running an APP means more people are involved - app developers, marketers, accountants, HR, legal.. and all these people need to be paid as well. The CEOs of these loss making apps make millions a year. Where does that money come from? Where does the money to buy uniforms, insulated boxes, insurance etc come from?? If restaurants were charging $10 for delivery, at least 7 went to the guy delivering. Now, that 10 has to be divided into many more bits. Everyone loses in this game. Except the app makers themselves. They sold a "dream" to the investors and are getting paid hand over fist even though the investor, the delivery rider, the restaurant, the customer all lose in the process.
Also not all food is made to be delivered, and usually it has a range. Pizza is famous for delivery not just cause its so delicious, but because it holds up so well during travel.
@@invention64And because a single pizza feeds more than one person, AND it’s pretty easy to deliver multiple pizzas to either the same or multiple places.
how do they make money? From the moron who now plays 20 bucks for a sandwich and from the gullible "gig" worker that runs around like a hamster for pennies.
Not comparable, those old delivery styles are small scaled and restrict to a narrow range of food selection, as hiring an exclusive delivery team just isn't feasible for most restaurants
Exactly! Those real employees (app developer, marketing, accountants, HR, legal) are the ones making the big bucks.
I find the framing of this a bit odd. I don't see "well-meaning government ruins struggeling market further" but rather "predatory companies try to build monopolies on the backs of underpaid workers". If they are not profitable they should charge more. If this means that less people use food delivery--then this is how it's going to be! Stop underpaying workers!
The companies are losing money as it is. If they try to charge more their sales will drop because they will be too expensive. The problem is that the entire business model doesn't actually work, for anyone.
@@xyzzyxyzzy2it only works for people who can afford it, the wealthy. If I made 150k+ a year I wouldn't mind paying extra to have my food delivered
@@xyzzyxyzzy2 Yeah, these companies need money to pay their execs and board members. How can they do that, if they have to pay minimum wage?
@@xyzzyxyzzy2if the concept doesnt work then these companies just shouldnt exist
Absolutely. These companies got market share by buying out all the local delivery services so they could set their own prices and control the market. Now they are using that monopoly power to try to control the government. The real silicon valley business model.
I never used any of this type of service. Seems like exploitation and destruction of local economy.
Same, I don’t use delivery and if I want takeout I call the place directly and go pick it up
It’s funny the companies pushed for tips when it benefited them more, because it meant lower cost. Now they hide it because it goes directly to the driver and won’t affect their base salary, imagine someone making money other than the company 💸💸
A true entrepreneur wouldn't mind if the employees are "making more" than the company, the company is concerned about their rate of return on the capital invested. It wouldn't surprise me if envy and greed were screwing things up.
@@jamesedwards.1069 lol that entrepreneur would be out of business quickly.
How it’s funny??!🤦🏼♂️ have ever owned an business?
@@user-Socrates I do and own currently 2 businesses with 4 employees and 2 part-time employees. What is intersting in this scenario is tips would lower the cost to the business, and they pushed for more tips.
Now the tips goes directly to the driver, and suddenly the tips button was deprioritized.
Tips should be rewarded for good service level, and not be expected to make a living wage..
Why is American service industry so reliant on tips. In any other country the full cost of labour is built into the price and no tip is required (unless the receiver is feeling generous)
Uber Eats was a complete waste of my time. I tried it last summer and was getting offers for $2-3 for 15-30 minutes of driving/waiting. Best case that would be $12 an hour minus gas etc. I turned the delivery off after just a few tries when I realized how terrible it was.
I did a bit of it, and quickly calculated (go dual college degrees) it's only workable and profitable if you treat it like a very small gig if you have a bicycle and stay within a small area. Otherwise, the expenses of the car exceed the income from delivery. I think I made something like $400 over two weeks but I did not use a car at all. It's not a coincidence that all the delivery "drivers" don't actually drive if they've been doing for any length of time.
@@langhamp8912Bicycle is so bad on Uber Eats, forget about it on DoorDash. Even if you're a top Dasher. Maybe 2 years ago, you could make some decent money, which I did I started back in 2020? But let me tell you something 2024 on E bike, even driving a car. It's so bad drivers are waiting around forever? I've worked in Miami. I've worked in California, Seattle in New York. I moved around. It was terrible. It's been very bad and actually quite depressing times have changed and I don't think they're gonna get better for food delivery. They'll never be the same before
@@langhamp8912 Yup...electric bike. The real story of vehicle electrification in the last ten years hasn't been Telsa it's been Schwinn. I'm assuming Schwinn makes electric bikes. They must....right?
@@drmodestoesqbut the electric bike isn't free though, is it? You fuck it up or someone steals or messes with it, there goes your month worth of dashing
@@crimsonlightbinder True....but a lot of trades require to bring your own tools. So you could say that about anything. I've worked fixing movie craft trucks and the problem was my boss stiffed me out a month's pay. So anything can happen.
And you can put a GPS tracker in your bike. You're going to have to get a bat or in America...you know....to retrieve it because we all know the cops don't care about your stolen bike.
I pretty much stopped using food delivery apps because the prices have gotten so high. It used to be that delivery was free, no service fee and same price as in the restaurant. But now, you have to pay for delivery, pay a service fee, and on top of this the price is often about 20% more than if you actually go to the place. You have to be really lazy/rich/hungry/dumb to order food on an app imo.
For local places in my neighborhood I've found other online options to order and pickup. That usually has little or no "service fees" and the regular menu prices.
Back when it was free for you, the apps were burning investor money. Now, when you order you are upfront paying to the restaurant, the app and the delivery person.
and now you have to tip.
Same here (though in Poland). The food delivery prices make no sense for a childless bachelor, it's twice as much as I would pay directly at the restaurant. I just cook for myself on the weekends and for the rare days I need to work from home, I just buy some packaged food on advance. Delivery would probably taste better, but even disregarding the price, I just hate how I can never tell when I actually get to eat. By the time the guy arrives, I sometimes would have become so hungry, I'd have had an extra snack.
Ahaha free delivery, no price increase no tax.. In what magic world do you live to hope it would stay like that
STOP USING THESE APPS
I'm so tired of hearing people complain about being broke while also hearing those same people talk about how they spent $50 to have 2 burgers delivered to them.
The only people who should be using them is high-income workers who make more money in 15 minutes (after taxes) than what the meal costs.
I agree with your logic - though you can’t use the argument of needing to make as much as what the meal costs in the time it takes to be delivered. When you go to a restaurant in-person, are you making more than it costs during the hour you’re there? No. You don’t need to be profiting every second of everyday just live your life, be happy.
@@mattdukeshire3837I think the idea is that going to a restaurant is an experience, but ordering food back is just a time saving thing. It's more expensive than eating in the restaurant and the food will be worse than eating it fresh from the kitchen on a plate. So there are only two reasons to order back, one being work pressure doing something highly productive and the other being laziness - the one to avoid.
The delivery app makers are basically saying they can't sustain their business with just above-average income workers making orders.
@watamatafoyu those delivery apps are all LONG overdue for consolidation. They all do the same thing the same way and pretty much the only difference is branding. They have redundant costs and at this point that's one of the only ways they can reduce costs
I’m a millionaire and I won’t pay these prices. Maybe that’s how I became a millionaire?
These apps are terrible for customers, for companies, and for "not-quite-employees". The idea of food delivery really needs to be rethought from the ground up
If door dash cannot achieve profitability with all their economies of scale, then it seems like this business is not feasible.
Maybe the USPS could do the grocery deliveries.
Does it though? The system worked just fine when individual restaurants who wanted to offer delivery would employ someone to make deliveries for the restaurant.
@@alexanderreynolds6018 I agree that it needs to be rethought. I don't think that delivery worked as well as it appeared. Obviously, it works well for those, who had in house delivery, but other restaurants weren't pressured into it. Put it this way: if the government mandates delivery services for every restaurant, then will it work? No, because not every product and service is worth the price of having it available. The problem with these services is that they complicate the prices, and it makes it impossible for businesses to truly be free.
If it was such a good deal, then you wouldn't see businesses adjusting prices. They would have done so before the service.
Also, I'm not an expert, but restaurants were able to put the driver to work during empty moments, like washing and mopping.
I do UberEats and Deliveroo in the UK and actually enjoy the job but the prices customers pay is ridiculous. I delivered a 6 inch sub from subway with a drink and some chips and looked at the receipt and it was equivalent to $20! UberEats pay is attrocious so it's only worth doing short orders or taking a long order if I have an order from the other app going in the same direction
Some years ago Domino's had a delivery in 30 mins or its free promotion. A friend on his motorcycle was hit broadside by one such driver who ran a red in order to make the 30 min window. Friend woke up in the hospital with 26 broken bones, steel pins galore and a serious limp for the rest of his life. So that a pizza wouldn't be late.
There is a good reason those promotions are illegal now
@@MrJimheerenThey are?
@@orppranator5230 yes, it’s basically a scam to steal money from employees
That was decades ago. Domino's got rid of that in 1993.
@@xyzzyxyzzy2 so OPs 'some years ago' could be over 30, got it
As someone who used to work in a restaurant and as someone who's almost been hit by delivery drivers on multiple occasions, I prefer not to give my money to anyone but the restaurant or grocery store. As long as my legs still work, I'll just pick it up myself.
And there's a thing called frozen pizza.
although I agree with your sentiment, I must also say that in my country, South Africa, gig work like Uber and Bolt have allowed many people to get a job where they otherwise would be jobless. Especially since our unemployment rate is 40%. third world countries benefit more from these gig apps than countries like America. Now I did Uber Eats for a while and it still sucks. but it helped pay food and utilities per month when I was looking for work.
I just wish that these companies weren't as scummy. Gig work could (theoretically) be great, if the model is done right.
@carmanterblanche Food delivery in South Africa sounds like a nightmare, it's dangerous to even stop at traffic lights there. I wonder how many people there can even afford to order food like that.
Had any dangerous encounters? I assume tips are pretty rare to come by, huh?
@@yarpen26 I personally never encountered a dangerous situation (although I did find myself in very sketchy situations that posed potential danger). I do know of other people who were held at gunpoint and got robbed while delivering.
in terms of affordability, I found myself delivering more in areas where people were poor.
This episode was ABSOLUTELY FANTASTIC! I watched many Morning Brew shows but only subscribed today because of how good this video was in terms of creativity, execution, and information. Macy is so incredibly likeable and professional. She is a prize asset of the channel and should feel amazing about all the hard work that brought her to this point.
I don't understand how the government allowed "active hours"
Going to the restaurant and waiting for the order is part of the job
That's how long haul truckers get paid, too. That's why it's not a great job anymore.
Yeah wouldn’t it incentivize slower delivery? As when they have the food is when the hours count…
@@benaloneyNo because you are paid so little per delivery that the end goal is always to do as many deliveries per day as you can. I deliver and I am thoroughly pissed if any single order takes too long. It means I'm making way less money.
Because it´s a capitalist society that puts the profits of companies above worker´s rights? We're all living in an oligarchy at this point.
"Going to the restaurant" is not accurate - the activity in question is "going near restaurants/hotspots so when an order comes in I'm closer." And "waiting for the order" is in fact not part of the job - waiting for the food that's been ordered is, but until an order actually comes in, you are not on the clock and are not doing any actual work for the company so why should they pay you? And how do you differentiate an employee "waiting for orders" versus an employee who has had enough and is on his way home (which may or may not be close to the order hotspot). Should workers be considered "on the clock" even if they reject orders, how many orders do you cancel/miss before you're no longer counted as "active"? Wouldn't workers exploit this to add a couple extra minutes after their final delivery for the day despite providing no service at all, in fact, reducing the quality of the service as orders are sent to a single driver (or maybe a few) at a time, meaning waiting until the order offer times out before another driver potentially accepts it, increasing the delay in customer service?
I made really good money delivering for Jimmy Johns. But they had tight defined delivery areas, work to do in down time, and a single base of operation with support staff. Completely different experience.
shout out to all the Jimmy Johns homies, y'all are the true OG's and super fast. thank you for your service
Old timer jjs employee but now I do DD on the side with my full time job
The only delivery models that worked for food was Pizza And Chinese food. 30-40 years experience for this model. No other food except sandwiches could possibly be delivered in edible form. Door dash from McDonalds runs close to $20 a meal with tip tax delivery added in. And the food is cold, the soda diluted and flat and the French fries cold and soggy.
How much average??
I make really good money currently driving delivery for my own business and I don't sweep floors or wash dishes in the downtime.
You got the key to making money correct. Small, defined delivery area. Every trip is short and completed quickly with very little mileage.
I don't deliver for a restaurant. I pick up food for customers. They order takeout and text me a screenshot of receipt. About 40 restaurants in my zone, all close together, and I don't go more than 2 miles in any direction.
When I've talked to drivers who started when the platforms were new, they found that they were great when there were times of low driver availability (surge pricing kicking in). As drivers started doing it as a full time job, or trying to, the competition made the surge windows less common. And the ones who wanted to do an 8 hour shift really get hit because there's only a couple of times of peak hours.
The more people that get involved in a process the more diluted the profit....Raise prices and customers leave.....Vicious cycle
This is why I hesitate on any app based company. Airbnb, Rideshares, and these delivery apps aren't doing anything that improves the process or makes better use of assets they are just shuffling costs around and adding new costs on top to cover the app companies expenses.
They connect the two sides…there is absolutely value in that. The question is if it is profitable
@@Tunafishyme they are, but how much is just regualtory arbitrage? Thats why uber was cheaper than cabs (improper insurance, no checks), air bnb (no tourism charges, inspections). They are also backed by massive vc cash allowing them to run at a loss for a long time pushing out the encumbants.
It's interesting that we are having this conversation. Your comment suddenly reminded me of the job application process and dating. Everybody is miserable.
I'm baffled by advertisements for jobs, when the companies already have hundreds or thousands of applicants for a given job. What are they thinking??
The delivery service testimonies that I have are the ones where people worked in a small area, and had almost a monopoly. It would be like a small town, and the customers didn't make unreasonable demands.
Some make sense, others do not. The fact that these companies don't even make money as the middle man makes even less sense. They shouldn't need a massive team to run, 10-20 people at most but nope, they probably have over 100 employees.
You are not correct. You dont need a middle man who takes calls, manage driver, fix the car or bike. Its taken care of by the app and getting assigned automatically. And no one is force to take part in that.
All the downfalls are the reason why some cities are driving out places like uber/doordash by making their own local delivery platforms. My local chick fila has their own delivery car.
That's how it was before the apps came along, they probably just never got rid of their own delivery service because they had sufficient demand to keep it going
Thats how things used to be especially with pizza places. Then the delivery driver would be an employee who can so deliveries when needed and do other work during down time.
In Colombia we have Rappi, I didn't make the minimum wage either, in two hours I made ~$2 USD and that's not enough to pay for a cellphone, data plan, a flat tire, the effort itself to ride a bike makes you eat more, a number of variables that make the job totally unprofitable.
Why do Riders continue to work for the app if the pay is so low?
@crisp854 They work smarter. Good skills in obstacle and traffic voidance, navigation, thrifty with maintenance, knowing your market. All these can go a very long way, believe me!
@@crisp854 why do you asume they keep continue to work for the app?
@@deltakid0 Indeed, employee turnover is high and basically runs on the same model that US fast food giants have used for decades: Bank on a significant pool of desperate labour to keep filling up vacancies and make sure little to no training is required to do the job to keep onboarding costs to a minimum.
I loathe these apps. We can't give people real jobs so we have the most vulnerable run all over town on their crappy two stroke scooters, polluting the air with noise and fumes and being a danger to those around them because they are driven to exhaustion from a "job" that barely pays.
All this to satisfy the recently emerged need to order food from across town instead of walking your ass to the pizzeria across the street like some kind of normal person.
The quality on this video is stupid good. Hats off to ya!
Definitely do a piece on marketplaces! Because this is def part of the "marketplace of everything" concept we see in the patments industry.
When I use delivery apps, I try to be as conscious as practical. I have a self imposed minimum $50 order, 20% tip guarantee, ask the restaurant to combine/reduce packaging, give clear instructions on the best spot to meet me, and always meet the driver.
ah a unicorn! thank you for being considerate. If you order late at night though I would recommend not meeting face to face after dark, being diligent about porch lights, and getting oversized or multiple sets of house numbers(important for emergency responders to find you quickly too)
Danielle, you need dessert.🤣🤣🤣 🍰 🍰
Danielle needs to tip if she's gonna be like that
Multiple collections, stairs to climb and no tip?
Danielle is a dick.
I work in VFX, which is mostly gig based. And in CA we got AB5 which no longer allows companies to classify us as independent and forces them to pay us as employees, meaning they are forced to share the tax burden. These horrible app based companies convinced (or tricked) voters to vote to carve them OUT of AB5 allowing them to continue to put the burden on customers. It's disgusting!
Who do you expect to pay when the government puts a tax on a business?
I never used any of those apps to order food, i do order takeout occasionally, but i always pick it up myself.
What scares me the most is how much money people are wasting on lunch. I just had a sandwich and chips at home for about $2.
I used to have a loaf of bread and make toast with a slice of cheese for my lunch. Very cheap for the week.
Exactly. And here's a great tip. Your company sends you to another town and book you into a hotel without a microwave in the room. But the room has that cheap plastic coffee maker. You can boil water in that to make your Ramen noodles.
And put that fat...fat....fat per diem in you pocket baby.
chips are not healthy. sandwiches idk it depends on the ingredients but mostly not so healthy. it's fast and cheap but probably will take a toll on your health gradually. And one day you find yourself in the hospital with a hefty medical bill
@@invisi6l339 I would wager it is healthier than what most of these people are ordering in.
That's like saying "Why does anyone buy expensive wine when they can get water from a tap for free".
As a restaurant worker i would occasionally get a tip on a to go order. Now with these apps the person picking up the food is at work too, so there's zero chance theyll tip me, yet i still have to prepare the order, which takes me away from the in store customers who will tip me.
Americans and their tips. The rest of the world does not tip. In some places it is a crime. Just pay your people already.
So you're complaining about doing the minimum work required for your employment? Quit your complaining, you're not entitled to a tip.
If you don't like your current state of employment, make your labor worth more by a new career, education, or licensing otherwise be quiet poor and learn your place. You're expendable.
@@Number6_ tip culture started when restaurants would hire black people and underpay them and customers wouldn't tip. Of course the white workers got tipped so it was just a way to discriminate and originally the white workers loved the idea. So I really don't even feel bad about not tipping.
@@Number6_ In my state the minimum wage has increased a lot and restaurant workers are paid pretty well (at least compared to other states). We havent had that whole "tips count as part of hourly wage" thing that they do in the MidWest/South for a long time... And yet tips are still expected here like any other state. In fact its gotten even worse as the prompt for tipping has expanded to all electronic payment and things that didnt used to be tipped are now expected to IE: ordering your food at the counter of a fast casual place most want tips now! I swear that was NOT the case when I was younger.
Paying workers better is the solution for a lot of things, but it is not the solution for getting rid of tipping in America. Its engrained in the culture, its societal, short of a Federal law banning or regulating tipping its not going anywhere unfortunately. In the meantime increasing wages has just made restaurant prices more expensive.
I still order over the phone and pick up my own food 95% of the time. It has nothing to do with fees as much as it’s mentally healthy to get out and do things. Picking up your own food falls under that category. Interacting with other people is also psychologically very healthy. The only times I use apps is super late at night or really bad weather and I tip well for both.
After Dan took up Good Work and stopped the Morning Brew content I thought for sure they wouldn't be able to replace such a character, but Macy is filled the role and is carrying the channel like a boss, whether serious or funny stuff, she kills it. Kudos
I knew I wasn't crazy. So he was associated with them?
@@YesHumphreyAppleby yep since 2020 Dan was the one who was running the Morning Brew Content especially the shorts, he was doing it solo & even the first few episodes of Good work before they officially named it Good Work, were Morning Brew Content and I think they spun it out to make it it's own thing but it's still under Morning Brew, which I think was a great move. I love both channels
Also why no body else seems to bring this up. Some door dash contractors spend 20 hours plus driving around orders. Why are truck drivers limited but not them? It’s extremely unsafe.
As a California driver, I am limited to 12 hours. But any limitations cost me profit! It’s hard enough making a living using these apps without another governmental restriction.
When Uber came along, a relative of one of our friends decided to become one of their drivers. His car did not qualify for their ‘age’ requirements so he had to lease a car, pay higher insurance for the new car, and between gas and the time spent in the job, he figured he was making $5 an hour. It is actually lower when you consider the added overhead,
For restaurant food, it appears to more than double the cost for your meal to have it picked up and delivered to you. Why not go get it yourself, or better yet cook at home? These drivers are in fact employees, they just are not called by that name. This business model is failing unless they can figure out a way to cover all the true costs including employee pay!
Hypothetically and monetarily you could justify the extra cost induced if you made at least the same amount of money with the time spent it would take to get the food yourself
"He had to lease a car".......what?
She can only afford to work delivery because she is literally working a second job at the same time 😂
She’s not doing it for a job. It’s an expose on delivery apps. I admire that she’s willing to get into it to give a good review
@@Dbb27wow. Nothing gets past you.
@@ryanthompson591 🤣🤷♀️🧚♀️🙃
My rule for take out is if you really want it, go get it yourself. It's a great reality check to determine if you're really too lazy to cook instead. Also the timing of you walking and talking to the elevator was perfect. Not a single motion was out of place.
many, many takes
I would agree, but sometime you don't have the right ingredients for a Chinese stir fry to give an example.
What if you don’t have legs? Or bum knees?
@@Nohandleentered So, you're being ableist, now?
I don’t agree. You can argue someone is lazy just because they ordered food I. The first place, instead of making it themself. If the offer is there and you feel it’s worth it to pay for the delivery, there’s nothing wrong with that.
How isn't this channel more popular?
It's been blowing up in my feed
Isn't this an expansion from the Morning Brew Newsletter?
The videos are improving in quality quickly. Even a few months back their content wasn't close to this well put together.
they can't do math.
5.75 + 5.00 = 16.50 according to their math. 6:20 @@rafaelsalamat
She forgot to include deducting 10% for costs and 40% to pay your personal business taxes...
Love this type of "case study" videos, please, keep the quality work up!
This is the kind of reporting that Vice wish it did. No wonder they went down the tubes.
This entire business just seems like something that could never scale with the amount of overhead required. The service is expensive because the revenue needs to go not only to the driver, but customer support workers and infrastructure, offices, executive salaries, marketing, server space, etc.
Drivers being contractors is the only way that this can even feasibly work because they can save on all the expenses that come with treating your employees as, well, employees. And even with that, it seems they're still struggling to make a profit.
I think the only way that food delivery works is at a micro level. A driver employed by the restaurant itself that can be paid hourly like normal, earn tips as a REAL bonus and not a part of your minimum wage, and during downtime can help out in the restaurant. No driving to and from different restaurants and hotspots, only ever to the delivery destination and then straight back. Minimal time spent not delivering, and when waiting on an order you can just help out at the restaurant itself. No overhead. No six figure salaries to the C-suite to pay for. No HR department to fund. No customer support wages to pay. No advertising costs.
Some things just are not meant to be corporatized.
Then again, these days you can just increase prices forever and people will simply keep fucking paying for it. For what reason, I don't know.
This is REAL reporting. Excellent analysis. It's hard to imagine a more screwed up business model than food/grocery delivery. Take a simple business model like a restaurant that involves two parties -- restaurant and diner -- with directly aligned goals (good food for adequate revenue/tip then spread that work across FOUR parties -- restaurant, app, driver, diner -- with no directly aligned goals between any adjacent pair of actors. Is it any wonder no one likes the result and makes any money?
Thorough reporting. Nice job.
There has been this mantra that Investors make returns these days by being disruptors. What does that generally mean? Cheap labor, taking advantage of some other industry (in this case restaurants) and using a business model that burns through capital. Do not waste your tears on the investors, cry for those who the model takes advantage of.
I assume he consented to it (and presumably/hopefully won't face any repercussions from it), but it seems wild to be like "this guy is doing an illegal thing" and then put his first AND last name on screen.
nothing's gonna happen to him, he's in NY "waiting processing"
DoorDash also charges 30% of the sale price to the restaurant on the backend too. Last time I checked, they don't have 30% margin to give away like that. It doesn't seem like a sustainable business.
I can't even remember the last time I used those delivery apps. They were starting to cost an arm and a leg, so I just started grabbing my own grub. Now the app's down a customer, and the delivery folks have less on their plate.
based on your reasoning, it sounds like you were one of those who wouldnt tip, so the delivery folks actually have more on their plate as a result of you not making orders...
F the apps and the few making bank while being vampires on the common folk.
Had family work for uber eats, they had horrible experiences, ppl who ordered were not answering their doors, gated apt complexes were like fort knox, pets, druggies, almost kidnaps, and finally car accidents, everything falls on you, awful awful job, at least real contractors have higher wages, all these food app biz are paying you penny's, for sure ppl will go else where to find jobs.
so just like pizza delivery used to be.
The employment classification for these service app workers is such a big deal, at least when it comes to shoehorning it all for tax season. I really appreciate the look and take on the amount of self-management and problem solving the workers have to go through, even with the support given by the apps. Great insight, great details, great report
Morning Brew is becoming the new Vice. I really enjoy it, hope it continues with the amazing content.
It hasn’t been a while because:
1-I know that ordering from local joins directly earns them more money and helps them stay in business
2-I know that ordering from chains doesn’t keep money in my community, the quality of food is lower, and it’s worse for my health.
3-I’m not fucking lazy and I can just go get it in most circumstances.
"Pre-tip" would actually not be a tip at all, but a BID for service. A tip would be in response to services rendered. Now, we have to tip more to ensure they don't spit in it. There must be a better way.
The only reason I'm watching Morning Brew is for Macy 🙃
She's the bessst
Why do you think that?
Simp
What happens when every company cuts out employees? Will there be ANY CUSTOMERS????
4:45 wait aren't you exposing your own source's identity and background?
As a restaurant owner i despise delivery apps with a passion. We refuse all orders with those delivery services.
Why?
@@Nohandleentered because they charge restaurants 20% of total, and we have to raise our prices like 30% percent to cover any future charges. It's not fair to my customers.... And they way I see it, I provide great food with 25 different fresh salas made daily, that if a customer doesn't want to come pick up the order himself he's not with my customer. Maybe one day I'll offer delivery, if I do I'll charge like a $10 min delivery fee... That will be strictly for the driver. ( Unlike some pizza chain that actually has the never to charge a "delivery fee" yet printed on box that the delivery fee is not for the driver.
@@RobertBrown876 they can't charge you a penny if you didn't agree to use their service lmao. If people can place an order at your restaurant on their app, you signed your restaurant up for their services.
@@RobertBrown876 they charge if you signed up to market your place on their app. You won't get orders from their app unless you signed up.
@@RobertBrown876 no idea why my reply keeps getting deleted 🙄 restaurants have to sign up to use the services. They can't charge you a fee you haven't agreed to. You can't receive an order from a service you haven't signed up for. That's just not how anything works.
I started driving last June when I moved back to California. I only did it to get the “free” college for ASU. I’ve added 25000 miles to my vehicle and the only time the money has been good is summertime, when it rains and Christmas season between thanksgiving and Christmas. I’m transferring credits from my old school to see what crosses over before making a decision to stay or not.
Thank you for doing such a thorough incredibly job with your reporting. You put in the work to research and report on every aspect of this issue, and even stepped into the shoes of a delivery gig worker to learn what it's really like, the amount of work it takes on a daily basis and issues the delivery gig workers has to deal with. You studied the economic situation, profitability issues and the laws. This is one of the best reports I've seen recently on YT. Respect and appreciation for your very helpful and informative reporting on this.
karens arbing their uber accounts to undocumented workers is not something i expected lol
They didn't go too much into it, but these apps don't check worker eligibility. All you need to sign up is a drivers license and insurance. Probably not even that if you are doing bike delivery. The reason these immigrants choose to pay to rent an account is to keep it under the table, so when the government digs into their background for their immigration application, the delivery job won't show up anywhere. If an immigrant doesn't care about ever becoming legal, they can easily have their own delivery account.
UberEats knows this happens. At least when I signed up, there's a clause in the terms of service that specifically allows subcontracting. Given the safety concerns associated with that, you'd think governments would be clamping down on it, but no.
Heh, heh! I agree. Why isn't there an app for that?
Or maybe there is....
If there's one thing people are good at it's finding ways to make money. We also love exploiting loopholes, from your local karen to multinational conglomerates (the latter free to get away with it).
Unfortunately, this talent usually seems to be restricted to a relatively small part of the population.
A bigger percentage spends all they earn and all they can borrow ----on JUNK!
Right?
Always go outside and meet the delivery person, it is insane making someone navigate buildings!
I didn't even realize that was an *option*.
Yes and no. Yes because the delivery person gets paid so poorly but at the same time you are paying so much extra for delivery why should you not expect it to come right to your door?
@@mchiarelli91They ARE coming to your door, your front door that is. Expecting someone to navigate inside your building is insane.
at night I prefer not meeting people face to face because people like to rob dashers a lot and drunks like to pretend they're the ones that ordered other people's food
@@orppranator5230 My building requires some navigation and understanding of how North/South towers work, which is why I tip extra.
Its insane not to navigate buildings. You deliver the food where the customer is and if you cant do that, find another job
Thank you for being committed for this video. But mate, this tip culture sucks in America. 😢
If I ever went to America for a trip, food will be so expensive for me almost 30% extra for tips for every time I eat is quite maddening
While I agree about tipping, assuming the country you're coming from just pays service peopel regular wages, the food will probably be about the same price, you just don't have to do math at the end to get it up to the final amount.
@@cloudkitt lol food is cheaper in every part of the world buddy
@@cloudkitt This is not true. Eating out is often cheaper in other countries.
20% is normal, 25% is that the service was better than normal and 15% is worse than normal. At least for restaurants and haircuts anyways.
@@orppranator5230that's crazy. In Romania, it's customary to tip about 5-10% and people are happy. Also restaurant workers are paid a livable wage, and this is the same in the entire Europe. 25% is just crazy stupid
Very cool breakdown of the business side. The sad thing is too many people are just flat out LAZY & the tech world is exploiting every niche.
I'm retired dasher. From my experience, food delivery in a small town I live, I get reasonable earnings per miles driven. They're not worth it in a big city.
How small was your town?
@@soon1429 My town was so small we didn't have a town drunk. Everyone just had to take turns.
retired dasher 😂
@@crimsonlightbinder I laid off myself 😒
@@drmodestoesq 😂
Macy is the GOAT!
The only way they could make this efficient or profitable is if they had much wider delivery time windows and were way smarter about scheduling jobs so they could aggregate multiple orders along similar routes. Doing one delivery at a time is killing the productivity, but if drivers could expect 3+ orders in a bundle all going in roughly the same pathway with enough time to pick them all up before delivering them all (or with new pickups near the last delivery) then there would be way less overhead.
Of course, customers would balk at waiting 45 minutes instead of 15 for their order and it would make the delivery people seem more like employees (because they would have less direct control over individual deliveries) so it won't happen.
That's what the Chinese apps do. One driver can have 5 or 6 different orders in a trip. Means the food will take 2 hours to get to you sometimes, but it is more efficient.
DoorDash stock up 71% in the last year - Have to wonder what Wall Street is seeing.
It's BS not to pay people for time they spend waiting to pick up orders. I was a waitress for a year and I had two hours of set up work at $2.13 an hour before customers came into the restaurant and I started making tips. In Europe and Australia, workers make at least $25 an hour and have government healthcare whether they work or not, and so baristas can still afford to live in the communities where they work AND take vacations. The US needs to pay workers fairly. We are SO far away from this benchmark, it's infuriating. Boo to California for not passing the law that would have made Uber drivers employees. Capitalism wins again.
lady you must be in some different europe, what f-ing restaurant pays waiters 25 bucks!?
Of course the illegal immigrant needs to pay the person also committing fraud… she is taking a big risk by doing so. You think they should just be able to use citizens accounts for free?
Maybe the citizen shouldn't also be committing fraud by breaking the TOS and giving someone her login. Maybe she should get a real job.
Thank you so much for covering this! Especially jumping in the trenches for a bit to see how brutal it is, and that's even with new protections.
I’ve just stopped using these delivery apps. It seems they are mostly bad for the restaurant, the customer, and the delivery person. When you break down the flow of money it seems like the only clear winners are the executives getting their millions in pay packages.
I don't understand how this is possible. How many deliveries does a delivery employee make per hour? 2? 3? And the minimum wage is $16? So that's $5-$8 per delivery into wages. Add a 10% profit for the company. No tipping needed, everything fixed. What. How are these businesses run so poorly?
Such a great content, thank you!
So... delivery apps are fundamentally nonviable. Mismatch between labor cost and produced value. How are these apps even still operating?
The same was said about Amazon as soon as they became more than an online bookstore. Many, many years of operating in the red. Only after they transformed multiple leviathan legacy businesses (Logistics, B&M retail, Media Publishing, etc.) did they begin to print money.
Undocumented immigrant labor was cited in the video as one reasonable factor.
@@GoFastGator Amazon's cash cow is AWS. Everything else is mostly a loss leader. Building the largest server farm in the world isn't an option for anyone else.
@@q45ij54q agreed on where the revenue comes from. But AWS wouldn’t exist without the website and streaming services that justify vertically integrating the data centers. And for either of those two “loss leaders” to work as they do today, Amazon turned the retail, logistics, and media rental modes inside out. My guess is that initially it wasn’t an intentional strategy to build AWS, more like a happy accident that smart MBAs capitalized on.
During COVID my friend thought UBER and DoorDash was a scam. He contracted, verbally, with two restaurants, to deliver their food for them in 30 minutes cycles. Meaning he would stop by the restaurants every 30 minutes and deliver any orders they had ready. All they had to do was charge a 5 dollar fee per delivery. He never asked for a tip nor did the restaurant ask for one.
While we do live in a small town, It did really well for him and the restaurants, especially since they did not have to pay a staff member and he was pretty busy (I think he was doing 20 deliveries a day between the two.) I said he was lucky they didn't stiff him on the fee. Then his regular job came back and he said it was much less work but it helped him out and some local businesses. I don't know why some of these local businesses don't offer more delivery. It seems like the perfect job for high schoolers looking to pickup some cash if they are willing to do the per delivery model.
The case for New York with the new laws is exactly how many services work in europe. The base pay is better (still bad) but tipping is very rare and low. Unfortunately you cannot have both high incentives and stable base pay.
Delivery apps are a waste of time and money
These Silicon Valley tech start-up delivery apps are both Silly and a Con for the customer.
Perhaps there's not enough margin in the food delivery market to afford middle men like doordash.
So just an app that other restaurants and couriers can use?
I call the restaurant and pick it up in 15 Minutes. It’s costs me about $1 in Gas and $5 of my time.
I have big respect for your going out there and doing research and not just parroting an opinion! Keep it up!
Nice work on this. Definitely worth the watch. Another win for Morning Brew.
Great video. Found you b/c of your shorts which are hilarious. This was really well done
Agree that the shorts brought me here too, AND they are hilarious!
I love this, actual journalism and really getting in there to get the full story, great work!
The worst of the gig apps right now is rideshare because they are paying .75/cents per mile in most states. NYC is the exception for both delivery/rideshare. You profit more delivering a hamburger than you do a human being.
Tech companies in a nutshell. Take investor money to make existing jobs “bit more” convenient. Drive out the traditional competition. Raise prices because drivers and customers are forced onto their platform. Lose money and exploit people. 👍🏽
While you sit there and act like your arse didn't use those apps GLEEFULLY.
Zoomers love to carp about these companies but cant be bothered to just go in-person and get your own takeout.
Just another day where I'm so glad that I've literally never used a food delivery app. If I want food, I'm going to go get it or having a friend, or having a coworker etc. I am well aware these people are not paid or treated nearly as well as they should be and I'm not adding to it.
So stoked to watch this always pushing it
As pointed out, dashing in other states is different. Here in California, Prop 22 guarantees minimum pay of $19.20 per Active hour and $.35 per mile.
To clear up some confusion, DoorDash (and I think all gig companies) passes on 100% of tips to the driver. The numbers she is giving is tips as percentage of total pay. For instance, I dash for 20 hours, 13 of which are Active (time being paid). I earn $300 and get $200 in tips. $200 is 40% of the $500 total earned.
Here, the typical delivery time is driving time + 5 minutes, and you aren't "Late" until 10 minutes after the delivery time.
Maybe I am in that part of EU thats too behind of evything, but we still rather call the restaurant for food delivery, than app
Many stopped having their own delivery because of the apps. If you need delivery, there’s no other choice for the most part. Only Dominos has their own delivery where I live.
@@sarahpercifield904 most (if not all) "take out" places in my city just have their own delivery people.
you order either through their own site (if they have one) or by using an app, you pay between €0 and €4.00 for the delivery
it depends on the place, and you're able to see the delivery fee in the same menu as where you see the different places that are open. so you know beforehand how much the delivery will cost.
so the delivery people are employed by the take out place.
those places have their own delivery vehicles, often electric mopeds or electric bicycles.
delivery is just a few €
and you know everyone gets payed a honest wage.
and there are no hidden costs, like you see on some of those delivery services in the US. were you end up with a burger that should cost $8 but after all the added fees you end up paying $30.
I still do it (calling a place to order), but I find restaurants that either have their own delivery or I just pick it up. Makes no sense to pay some huge premium on my food for it to be delivered only for the driver to still get paid insufficiently unless I pay even more. The cut that the apps take is absolute robbery. and where does it go? the companies still take a loss, so its just going into the top's pocket while they post losses. also, the app change from NY law changes was clearly designed out of raw spite. Perhaps... crazy thought... if they aren't profitable, maybe they simply shouldn't exist? there's actual profitable small businesses that can't get a dime in funding, either by loans or investors, but people are happy to dump billions into a money sinkhole like these.
"but people are happy to dump billions into a money sinkhole like these"
It's disgusting.
The top executives in those companies are the ones making bank
@@ozymandias8523 absolutely. It's almost as though it was a grift.
As an employee for one of the biggest European delivery companies: they could be profitable if they wanted to. The reason they are constantly "on the path to profitability" and "just below the breaking even point" is that if they get close, they spend on growth. If you start actually _earning_ money, that means paying taxes. And from corporate POV that's just wasted money. Spend it or lose it.
There are only two ways it’d be profitable. (1) if they rely primarily on autonomous delivery like drones or crawlers - deliver drivers and public lose out or (2) they consolidate to a monopoly this would then help profit from the consumer side and make their service less elastic or commoditized - consumers lose out (3) they are allowed to raise their restaurant charge to whatever they need for profitability, likely around 35-40% - restaurants lose out.
So none of these three are likely to happen or be permissible. The prospect of profitability of delivery services is low. But it’s a cool space and there’s lot of venture funding with tech jargon. Heck, you could call yourself a tech company like WeWork and benefit from the mystic of “tech” on your valuation and fund raising.
So while I enjoy the cheap food and promos with convenience of having it delivered - I feel sorry for their shareholders. Lol.
“Open access to work” = no unions and mass invasion.
union bit is stupid, mass invasion you are spot on. What can a uNiOn do for you?? If you're unionize like a stupid commie they'll just deliver via robots
I ❤ Macy
That's the problem specifically with food delivery apps: the margins are already very thin, there's no money left to keep the thing afloat unless you charge customers an amount they'd never pay for. Think about it: the app fees you CURRENTLY pay already results in the app company taking a loss and those fees are already high.
The lack of transparency from these companies is really disturbing. They are upending entire industries and we don't even know what the workers are making.