Layoffs Rock Delivery Hero
Cartken bots head to retirement homes, NYC pay law in effect, instant delivery data
Robots, pay raises, layoffs, beautiful data… today’s newsletter’s got it all; read on!
Today’s edition is brought to you by the DRA Restaurant Marketing Summit.
Today:
Cartken Heads to Retirement Homes
NYC Pay Law Boosting Courier Earnings
Chart Time | Instant Delivery Preferences
Delivery Hero Cuts in Berlin, Istanbul, Taipei
AUTOMATION | Cartken’s Delivery Bots Head to Retirement Homes
Even the loneliest retiree is about to have a new friend that’ll visit them: Cartken’s delivery robots. The California startup just launched its services at Hoosier Village Retirement Community, a 300 acre retirement community north of Indianapolis. Food services at the suburb-sized complex are managed by CCL Hospitality Group, a subsidiary of Compass Group USA, giving Cartken a foot in the door for universities managed by the dining giant.
The Big Picture: Campus environments are great for delivery robots, as they offer a defined environment to map, and usually have low (or no) conflicting auto traffic. Retirement communities are likely even better than college campuses, as the elderly are less able-bodied than their college aged peers (although perhaps a university senior is more likely to be “glued to the couch” and need an emergency taco delivery after his or her 10th midnight bong rip…) The race to claim specialty campus environments is heating up; Europe’s Delivers.AI just announced its finally coming to America in Q1, starting with a planned community outside of Atlanta.
PARTNER | Restaurant Marketing Summit Returns Jan 31 - Feb 1
It’s that time of year again! The DRA Restaurant Marketing Summit powered by Branded is January 31st and February 1st and we want you to be the first to know!
Join the DRA for this free, two-day, virtual conference that brings together industry experts to showcase their knowledge and expertise on topics including: brand engagement, customer loyalty, customer acquisition, profitable 1P & 3P delivery, and utilizing data & marketing insights! You will hear from 20+ industry leaders including CEOs, Founders and speakers from Google, Ovation, Voosh, McDonald’s, Lineup.ai, Marqii, and more. Register Now!
POLICY | New NYC Pay Law Filling Courier Pockets
NYC’s new pay and employment mandate for delivery workers went into effect December 4th, meaning many couriers have now received checks reflecting the updated wage rules. With the base pay rate now at $17.96/hour or $29.93/active hour, couriers are reporting that the percentage of their pay coming from tips has fallen to 5-15%, down from around half under the old model. An NYC study in 2022 found that the average delivery app worker made $11.12/hour with tips, $4.03/hour without, far below the city’s minimum wage. Workers are already reporting that they’ve seen noticeable jumps to their take home pay.
The Big Picture: To cover the new costs, 3PDs are adjusting their models. Uber and DoorDash have moved tipping to post-checkout, while Grubhub has reduced the suggested tip amount. Uber has added a new $2 fee, Grubhub has added a fee of up to $9 and DoorDash is planning to raise charges as well. Bigger changes are still coming; in January Uber will roll out a “first come, first served” system that caps the number of couriers on the platform at any time. While that will ensure any working courier has less downtime between trips, it may keep other workers from earning at all.
CHART TIME | Consumers Willing to Pay for Fast Delivery
The longer that quick delivery has been around, the more consumers get used to it. And the more acclimated they are, the more they’re willing to pay for it. That’s one of the findings in a McKinsey deep dive into same-day delivery, alongside interesting findings regarding which shopping categories use decentralized fulfillment vs ship-from-store vs dark store, peak order time, vehicle regulations and more. That said, there’s a pretty obvious error on the “urban density” chart — hit us back in the replies if you see it too. :)
3PD | Delivery Hero Closes Offices, Cuts Staffers
Multinational 3PD Delivery Hero just enacted a painful round of belt tightening, with CEO Niklas Östberg sharing the company was closing its tech hubs in Türkiye and Taiwan, as well as slashing headcount at its Berlin HQ. Combined with an earlier round of layoffs in January, the company has cut 13% of its employees, who numbered 51,118 at the end of 2022. The company is also still rumored to be looking for a buyer for its Foodpanda business in Southeast Asia.
The Big Picture: Delivery Hero has been trimming the fat as it looks to eke out profitability; the company is aiming to be adjusted EBITDA positive by year’s end. With only about 3,000 employees at its Berlin HQ, the brunt of any further cuts will be largely felt in other corners of the world. Its tech hub in Istanbul, where it operates the brand Yemeksepeti, just opened in late 2021; it planned to “build a digital ecosystem driven by big data and robust technological capabilities.” At the time Delivery Hero hoped to expand the facility to 1,000 employees, joining its 14 other tech hubs in cities like Dubai, Singapore, Buenos Aires, and Seoul.
A Few Good Links
Jumia exits food delivery biz in Nigeria, Kenya, Uganda, Morocco, Tunisia, Algeria, Ivory Coast; Jumia Food accounted for 11% of overall GMV. DoorDash replaces Zoom on Nasdaq 100. USPS ready for holiday rush. FedEx, UPS hike fuel surcharges, despite low diesel prices. C-stores turn to food and merch for holiday sales boost. BJ’s modernizes inventory ops. Meijer offers SNAP users discounted milk. Papa Johns intros Cheesy Calzone Epic Stuffed Crust Pizza, hope it travels well… Coupang buys Farfetch. Google to pay $700M over Play store monopoly. NY lawmakers want Chick-fil-A to serve on Sundays. Gov’t may require automakers to add anti-drunk driving tech. Port of LA cargo up 19%. New DOT bigwig used to work on AI truck parking. Truck driver incentives slip. How Target uses AI. Understand mobile driver’s licenses.
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