> In any case, it’s seriously overpriced.

As someone on Twitter aptly put, "you're ordering a taxi for your burrito"

What do you expect the price to be?

They kept it really cheap over the pandemic. But that long ended and we are indeed back to taxi prices.

Doordash's first ever quarterly profit was in late 2024, 12 years after founding.

Just like most companies from ZIRP era it was held together by unlimited investor money that let it grow through price dumping.

There are an almost unlimited number of services out there that many people want but aren't willing to pay the true cost of providing. Food delivery (in whatever form) is one such in many cases.

It's fairly impressive how it isn't profitable to essentially act as a middleman between two resource centers that you do not need to directly pay for. I guess the unfortunate fact is that food service was always a low margin business and the compensation needed to survive in America never made food servicing itself viable. At least, not for the last 40 years or so.

It does make me curious what the costs are on the app side, though. We keep saying tech is scalable but many such apps have this same story. Is there a cost center I'm missing for such an app that makes it so hard to profit off of, or is it just reckless abandon of spending?

Service industries are all low-margin.

You introduce a middleman, and it eats into the already thin margin. And it's not just one middleman. It's two: the app and the delivery guy.

The average profit margin for a restaurant is 3-5%. Then you add the app that needs money. Then you add the delivery which needs money. The only way to keep the original restaurant price is to heavily subsidize the app and the delivery.

The "tech" is scalable but that 1.) Assumes scale and 2.) Is often being provided by developers and others that are being paid far in excess of what anyone else in the food service industry is making.

In the ideal case, your burrito is sharing a taxi with many other burritos going the same direction.

It's still a taxi for your burrito where you pay three entities: the restaurant, the delivery, and Doordash

It seems like the neighborhood Facebook feeds are full of people complaining about incorrect orders, missing food, stolen food, food that got delivered to the wrong house, as well as drivers complaining about not getting tips, customers incorrectly reporting food as stolen or missing...