Food Delivery Services Adapt To COVID-19

Photo Courtesy of Eggbank via Unsplash

As the US moves closer towards the end of the coronavirus, food deliveries have definitely been normalized— restaurants and cafes even set up a section just for couriers to pick up food. Throughout the past year, social distancing guidelines have deeply hurt the economy, and any outdoor activity has posed a threat to public health due to COVID-19— the risk of bringing in the virus through plastic bags and other items from stores have also led many to immediately sanitize every one of their belongings. But what does this mean for companies that revolve around delivery and contact, and how will their consumer base fluctuate?

The appeal for delivery not only grew, it also acted as support for restaurants in financial stress; DoorDash’s 2020 economic impact report revealed that their services were an important asset to bringing in business for restaurants as 65% of them saw an increase in profit during the pandemic. A profit for those restaurants means a profit for DoorDash as well. The company reported that they were valued at $16 billion in June of 2020, a $3.4 billion increase compared to their valuation in 2019. Another well-known food delivery company, GrubHub, also reported they made $459 million in sales in 2020, which was a 41% increase from their 2019 sales. However, this trend was not the same for others; Uber, which had a gross revenue of $4.1 billion in 2019, announced that their revenue decreased to $2.9 billion at the end of March 2021.The reason was because of the decrease in demand for their original ride-hailing service—Uber Ears quickly become their main source of revenue.

Many of these companies have branched past delivering only for restaurants— it’s popular to request shipments of groceries, snacks from convenience stores, and even deliveries from Petco (partnered with DoorDash). Despite the upwards demand for delivery, many have begun to wonder if the growing success will last once the pandemic is over— this creates many conflicts in terms of profit in the future. In 2019, DoorDash claimed that their couriers earned an average of $18.54 per hour, including tips, but this raises questions about unemployment; although 2 million couriers joined DoorDash during the beginning of the pandemic, CNN reports that people will probably continue working for food delivery services even if wages decrease or are very low. Keep in mind that it is also common for couriers to work for multiple delivery services at once.

Even through the crisis of the pandemic, these delivery services continue to practice social distancing guidelines; Uber and Lyft have even partnered with the White House to provide free rides to COVID vaccine sites. But as vaccines continue to roll out and the effects of the pandemic begin to recover, the future demand for food delivery and couriers remain unknown.