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McDonald’s adds another delivery provider

The company is launching with DoorDash in Houston later this month, ending its exclusive arrangement with Uber Eats.
Photograph courtesy of McDonald's Corp.

McDonald’s is bringing in another delivery provider to supplement its McDelivery service in the U.S., adding delivery through DoorDash in a deal that ends its 2-year-old exclusive arrangement with Uber Eats.

The company said it would start offering delivery with DoorDash at more than 200 restaurants in the Houston area on July 29, and that it would ultimately make the service available to DoorDash customers nationwide. DoorDash is available in all 50 states and reaches 80% of the U.S. population.

“In a few short years, McDelivery has become an important part of our growth and our customer-centric strategy,” said Chris Kempczinski, president of McDonald’s USA, in a statement.

McDonald’s added delivery in 2017 in an exclusive deal with Uber Eats, jumping head first into the third-party delivery trend.

The Chicago-based burger giant had negotiated a new deal with Uber Eats earlier this year that included a smaller commission and an end to its exclusive relationship.

That shift in thinking came as operators grew frustrated over delivery’s profitability. Franchisees had said in a survey earlier this year that McDonald’s needed to renegotiate its deal with Uber Eats.

More companies have been shifting to multiprovider strategies to broaden delivery’s reach and expose their brands to more customers—believing that each service has its own base of customers and stronger presences in different regions of the country.

McDonald’s also wanted to ensure that more of its 14,000 U.S. restaurants have delivery available so it could start marketing the service. The company said that 9,000 of its restaurants have the service, and it recently started advertising McDelivery.

McDonald’s said that delivery is now about a $3 billion business globally.

The chain said it would be part of DashPass, DoorDash’s subscription program that offers members free delivery on orders of $12 or more. It boasts more than 1 million members.

“Our leading U.S. market share and best-in-class operations paired with McDonald’s scale makes this an attractive, win-win partnership,” said Christopher Payne, DoorDash COO, in a statement.

McDonald’s and DoorDash have integrated their systems so the delivery provider’s orders are sent directly to the burger chain’s point-of-sale system.

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