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The drop on third-party delivery services

Now chains are driving third-party services.

Chipotle recently announced that consumers soon would be able to get burritos delivered to their doors—but the drop-off wouldn’t be done by its own staff. Instead, the chain is bringing a third party into the mix, partnering with Postmates, a San Francisco-based startup gaining steam. And Chipotle isn’t the only big chain signed up with the food-courier service. Starbucks revealed earlier this year that it’ll start testing two complementary delivery models: a Green Apron service using its baristas for nearby deliveries and a pilot  program through Postmates that will begin testing soon in Seattle.

While Postmates and other restaurant-delivery services have been popping up spottily in big cities for some time, the buy-in of national brands is a potential game changer—and not only for the messengers. Food takeout and delivery is a growing segment, one estimated by researcher BI Intelligence to be a $70-billion-a-year business in the U.S.

But for an operator to take on delivery in-house requires time and effort. “Delivery requires a lot of management,” Daniel Holzman, co-owner of six-unit chain The Meatball Shop in New York City, said to CBS News. “There’s a lot of liability involved. You know, to think that an employee of mine is out there in the streets of New York City … it’s scary.” So having a third party handle delivery, he said, is a “no brainer.”

That’s the attraction for restaurants. In the 22 markets in which it operates, Postmates—which has been calling itself “the Uber for stuff”—hires independent couriers as delivery folk. When consumers place orders through the Postmates app, a nearby courier can accept the request and then will call in the order to the restaurant, pick it up and deliver it, all for a fee to the diner.

But Postmates has seen fierce competition of late from a number of other third-party services (see above). Both startups and large companies—including the actual Uber—are promising fast, consistent food delivery and a wider reach than operators delivering for themselves.

And these third-parties aren’t the only ones vying for a piece of the delivery business. There’s added competition coming from a cadre of startups, including Maple, Munchery, Sprig and Spoonrocket. Instead of picking up from restaurants, these companies promise restaurant-quality meals from a rotating menu designed by local chefs. 

 UberFRESH/UberEATSGrubHub SeamlessCaviarAmazon Local
What about it?Through an added feature on its app, the cab service is getting into the game with curbside weekday lunch delivery from "favorite local restaurants."The onlineordering giant brought delivery drivers in-house in February.Another courier service touting real-time GPS tracking; its focus is on higher-end restaurants as well as independents.The online retailer's food-delivery function kicked in at the end of last year, letting Amazon users place orders for a select number of restaurants and charge it to their Amazon accounts.
AvailabilityLos Angeles, Chicago and New York City.San Francisco, Los Angeles and Chicago, plus more markets with its purchase of DiningIn and Restaurants on the Run earlier this year.18 markets including Boston, Dallas, Miami, Los Angeles and Philadelphia.Seattle.
Delivery promiseLess than 10 minutes.Arrival within a specified window of time.50 to 70 minutes with option to preorder ahead of time.24/7 availability.

 

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