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More delivery + That burger + Oversharing
Welcome to Expedite, a (mostly) weekly newsletter by Kristen Hawley covering what’s important in restaurant technology.
I was really hoping to avoid writing another 1,500 words about third-party delivery, but the hits keep coming. Here’s a quick rundown of where we are right now.
On pizza arbitrage: Thank you to everyone who sent me this truly excellent piece about a restaurateur who made money by ordering his own pizzas via DoorDash. Ever the optimist, I’m hopeful that these moments might reset some of the unsustainable business practices that have fueled off-premises growth in the last few years. I’m hopeful the inevitable consolidation will come with terms that are more sustainable for restaurants, and a business model that supports everyone’s growth while treating workers fairly.
On regulation: Los Angeles is the latest city to cap the commission fees charged by third-party delivery services. The measure limits the fee to 15 percent via emergency order, so it’s not permanent — yet. It also applies only to restaurants within the city limits. Like the legislation in New York, the bill differentiates between delivery orders and those placed via third party apps for pickup. Pickup fees are capped at 5 percent. I’m interested to watch what happens as local businesses and legislators push for these changes to become permanent. These emergency changes could prove what restaurants are saying — that delivery businesses are predatory — or what the third parties say — that the economics of their business won’t work with such low fees.
On Chuck E. Cheese: If you find this Pasqually Pizza story reprehensible but get excited about finding restaurants like "F#ck Gluten" and "B*tch Don't Grill My Cheese" on Grubhub, boy do I have a story for you! (The story is that ghost kitchens can create short-term, viral, digital-only brands that deliver a limited offering and can spin up literally overnight.)
If you feel duped by this, you haven’t been paying attention. Uber Eats has used its own data to encourage digital-only brands for years. (Here’s a piece I wrote about this trend two-and-a-half years ago.) It’s a fundamental piece of the ghost kitchen puzzle, the ability to spin up a business based on local need or even just trends. I also find it curious why people feel so duped by this marketing — if you’re willing to choose a restaurant based on its delivery listing without taking ten seconds to Google it, I don’t know you can claim to truly care which kitchen it came from… right?
On the Grubhub/Uber situation: Rumors of slow takeover progress persist a week later, with the latest reports indicating negotiations have continued, even as some lawmakers call for an antitrust investigation. I’ve also seen this reported as food delivery “saving” Uber, which I’m not sure is the right take; Uber Eats has been both a bright spot and a black mark for the company, though now that we’re playing by pandemic rules it could be a short term solution to stem some of the big losses we’re sure to see in the coming months and years.
What else is happening?
On that burger: I think one of the most challenging things about this phase we’re at in the U.S. is watching other countries resume small senses of normalcy. I’m feeling jealous, you’re probably feeling jealous. But are we jealous of Noma’s cheeseburger, or are we jealous of a society that seems to prioritize the safety and well-being of its citizens?
As Eater’s Hillary Dixler Canavan pointed out in her analysis last week, this temporary operational shift also requires Denmark’s support system to be a viable operation. I am not an expert on Danish culture. But from my personal experience of only three trips to Denmark, I can confirm that the Danes are, as a rule, friendly and rule-following. I tell this anecdote all the time, but as a fellow rule follower, I love it. On our most recent flight to Copenhagen from San Francisco, the flight attendants repeatedly admonished Americans casually moving about the cabin while the seatbelt sign was on. They did this from the safety of their own jump seats. It was beautifully refreshing, honestly. (aw, remember seat belt signs?!)
I do think it’s newsworthy when a restaurant consistently ranked among the best in the world makes an adjustment like this. At the very least, it's an inspiration for others — I mean, how many times have you read the story out of Vilnius, Lithuania of the city closing down its streets in favor of open air dining?. Every story about every city potentially doing this (looking at you Berkeley) references it. It won’t work everywhere, but it’s momentum and progress and — I think — encouraging. Unfortunately, none of these things happen in a vacuum, and I suspect this American will spend a tortuous summer in foggy San Francisco full of jealousy of the people and places that work together to move forward, while enjoying actual warm weather.
On documentation: There’s been no shortage of guides, tips, how-tos, and handbooks from restaurant groups and brands helping each other work through this crazy situation. (Though very little straightforward guidance from government leaders in this country, but I’m done being surprised at those levels of ineptitude.) The one from Black Sheep Restaurants in Hong Kong feels like a dispatch from the future, since those restaurants are actually operational right now (but, like Denmark, this seems to require a level of cooperation that our country is not ready for.)
I’ve also been impressed by Sweetgreen’s own documentation of the changes it’s faced over the past two months. The company detailed the launch of Plates, its more-than-salad dinner service, in a Medium post, noting that the entire process, which would normally take a year, was crammed into “30 socially distant days.” Later, as regulations relaxed across the country, the country also detailed the changes in store for its in-store experiences, an exercise in information and oversharing to ensure diners feel safe. Remember: restaurants have long practiced the sort of safety and hygiene practices now mandated for doing safe business, but now — like the Chipotle of five years ago — businesses need to make this information impossible to miss as they work to coax a wary dining public out of their homes.
Have a nice, and safe, Memorial Day weekend. If you're looking for something to do, my friends at ChefsFeed* are offering a weekend full of digital programming from well-known chefs. A Chefstival! A weekend pass costs $150 and benefits SF New Deal. You can also purchase a pass for an individual class. Details here.
*disclosure: ChefsFeed staffers are my actual friends, and I have done contract work for the company in the past.
Yours in dreaming of socializing complete with summer beer and chilled rose,
Expedite is produced by Kristen Hawley, a San Francisco-based journalist with over six years of experience covering the restaurant technology industry. Previous iterations of this content were available via Chefs+Tech and Skift Table. Thanks for reading.
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