Doordash is the future of restaurant delivery. They help hungry people get food in more than 4,000 cities in the US, Australia and Canada. But Doordash’s story starts much earlier than this. Back in 2013, when they first launched, the industry was completely different.
By building out their Dasher program, Doordash was able to see explosive growth, to the tune of 800,000 daily deliveries, which experts predict will give them a 15% market share by 2022.
Continue reading to learn how Doordash makes money.
The History Of Doordash
There is a story behind every success, and the same goes for Doordash. So, in January 2013 in Palo Alto, four Stanford students named Evan Charles Moore, Andy Fang, Tony Xu, and Stanley Tang came together to create a food Delivery Company called Doordash. In June 2013, the company was incorporated in Delaware.
The establishment of this company revolutionized the food delivery industry. People are busy, always on the move, and want to get things done quickly with no hassle. This tech solution created a platform for ordering food with just with a few taps on a device.
Assisted by Y Combinator, the company started to receive funding in 2013. Investors including Pejman Mar Ventures, Khosla Ventures, Andy Pachleff Charles river ventures, and others, followed suit.
In October 2017, CFO Mike Dinslade resigned from Doordash, about a year after joining the company.
In 2018, it rose to become second most used app in its niche behind Grubhub, overtaking Ubereats in total sales in the United States.
Surprisingly, by March 2019, it had overtaken Grubhub in total sales, which made it the largest food delivery company in the US, a position it held for the rest of the year.
In October 2019 Doordash established its first ghost kitchen, named Doordash kitchen, in California. By December of the same year, it raised $37 billion through an IPO.
How Does Doordash Work?
So, its operation is quite simple. A customer places an order from a restaurant either through the Doordash app or directly from their website. After this, the Doordash driver gets a notification via the app installed on their device. This can either be accepted or rejected by the driver.
Therefore, after accepting the order – the dasher drives to the restaurant, gets the food, and delivers it to the customer.
Restaurants can also partner with Doordash to access its customer base. This is done by filling out a partner application form. This is available to restaurants of any size. Once registration is completed, Doordash will design how the restaurant will get the orders and shares the restaurant's name, location, and phone number with customers.
To get started, the Doordash app can be downloaded on both Android via the Google Play Store and IOS devices via the Apple App Store.
What Does Doordash Do?
Doordash is a platform that allows customers to order food and drink from local restaurants. Orders are delivered by a dasher (one who has signed up for delivering on Doordash).
With this arrangement, Doordash makes it easier for restaurants to get food and drink delivered without having to hire delivery drivers.
What Is A Dasher?
Dashers are the drivers that work to deliver the foods. Several people have subscribed to the platform as dashers to earn some extra income. As a dasher, one can decide how many hours they would like to work delivering food. Dashers can work a regular nine to five job or just a few hours per week if they want.
To become a dasher, you must be 18 years or older. Most competitors require tha you must be at least 21. To become a dasher, you must have access to a car, a motorcycle, or a bicycle.
How to get started:
- Submit an application
- Select the appropriate driver orientation
- Download the app and start dashing
Requirements of becoming a dasher:
- 18 years or above
- Access to a car, a scooter, or a bicycle
- Valid driver’s license
- Social security number (only for US residents)
- Background check
What Is The Top Dasher Program?
This is an arrangement that recognizes and rewards top-performing food delivery drivers. Top dasher status is attained through good customer ratings, high ratings of successful deliveries, and also higher acceptance ratings.
The top dasher program aims to motivate delivery drivers to accept and complete as many deliveries as possible.
So, in summary, to qualify for the top dasher program, the following must be achieved:
- Not below 95 per cent delivery completion rate
- More than 100 completed deliveries in the month
- Not below 70 per cent order acceptance rate
- Not below 4.7 customer ratings
- The driver must have completed over 200 lifetime deliveries as a dasher
What are the benefits of becoming a top dasher?
The following are the major benefits of becoming a top dasher;
- Access to high-value orders ($30 and above)
- Dash anytime and anywhere without necessarily scheduling in advance
- Access to more deliveries
Is the top dasher program worth it?
The answer to this question is based on the driver's preference. Some drivers believe that it isn't worth putting in the effort, because higher acceptance rates often mean accepting lower-value orders.
However, a handful of other delivery drivers are in love with its benefits, one of which is that drivers can get the best deliveries and higher pay.
How does the top dasher work?
It works monthly. This implies that once you meet the conditions, you automatically qualify as a top dasher from the beginning of the next month.
Does Doordash Pay Daily?
No, Doordash does not pay daily. There are two options through which delivery drivers can receive payment; regular weekly deposits into the driver's account or through the Fast Pay option.
The weekly payment option is cumulative of completed deliveries between Mondays and Sundays of the previous week, ending at Midnight. The cash is available as soon as the bank receives the payment. This is also dependent on the bank, as it could take two to three days for the bank to receive the money.
For a driver to qualify for Fast Pay, a total of 25 deliveries must have been completed within a week to initiate. A fee of $1.99 might apply to this option. However, it enables drivers to get paid as soon at the end of each day.
Does Doordash Pay For Gas?
No! Doordash does not pay for gas. Neither does it reimburse dashers for mileage or any other expenses. Delivery drivers are signed up as freelancers, and therefore do not qualify for employee benefits.
Total income is cumulative of base pay (determined by time, distance, and desirability), promotions/bonuses (determined by peak pay and challenges), and other forms of tips.
Delivery drivers must factor in gas expenses when in comes to predicting their take-home pay will be.
What Is Doordash’s Business Model In 2021?
Does A Restaurant Make Money From Doordash?
Yes, restaurants make money from Doordash after subscribing to receive Doordash's custom financial advice and storefront service. This is a program that makes it possible for owners of restaurants to amplify their store/services via the Doordash drive platform.
The restaurant will have to pay certain fees, which might range from $6 to $10 weekly, also depending on the plan opted for. The company assures that this program will help to boost the restaurant's revenue by up to 50 per cent.
Is Doordash Profitable?
Over the years, Dordash has established itself as a force to reckon with in the United States food delivery industry, surpassing the achievements of competitors UberEats and Grubhub.
In a bid to boost its profit and revenue, it launched a shared kitchen in 2019, which is similar to those of UberEats and Deliveroo. These shared kitchens are used in areas with low delivery expenses, helping cut down on operational costs.
Doordash went public on the New York Stock Exchange in 2021 with a total valuation of $72 billion.
The following are the ways Doordash makes money:
Commission: the restaurant is charged a commission fee of about 20%
Delivery fees: the customer is charged between $5 to $8 per order
Advertising: in addition to the commission that restaurants pay, they are also charged for marketing and advertising on both the app and Doordash website. However, the charges may vary from one restaurant to another.
Who Are Doordash Competitors?
In the food delivery business, the following are the competitors of Doordash:
First Watch Restaurant Group, formerly known as Al Fresh was launched in 2017 as a daytime restaurant for made-to-order meals. Also, with about 9,000 employees and with headquarters located in Bradenton, United States, it prides itself as a strong competitor in the food and beverage delivery marketplace. It is valued at over $1.3 billion.
This is an online restaurant platform for customers to order meals and have them delivered. The mobile app offers information about the restaurants, rates, and reviews.
It was founded in 2008 in Gurgaon, Haryana, India by Deepinder Goyal, Gaurav Gupta, and Pankaj Chaddah and has since established itself with restaurants in over 24 countries.
It was launched in 2011 by Bastian Lehmann, Sam Street, and Sean Plaice. With its headquarters in the San Francisco Bay area. Other locations in the US include Vancouver, Bellevue, Nashville, and New York. Postmates is designed to have better customer support and is also good at meeting specific requirements.
With an estimated revenue base of $1 billion and over 5,000 employees, Postmates is a strong competitor in the urban logistics and on-demand delivery marketplace.
UberEats was launched in 2014 and has since established itself in about 20 different countries, including Canada, Mexico, United States, Spain, Brazil, and France. Others are Japan, Australia, Poland, UK, Italy, Portugal, Switzerland, Chile, Taiwan, South Africa, and Belgium. When compared with Doordash – it does better with large orders, because Doordash has a service fee of between 7% to 15%. See how delivery drivers maximize their earnings on UberEats.
It began operations in 2004 as an online and mobile platform for delivering orders and restaurant pick-up. Once the app is downloaded, users type their address, and a list of available local restaurants is provided to them.
As of 2019, its net income stood at $18.57 million, while its total revenue was $1.31 billion. GrubHub subsidiaries include Tapingo, OrderUp, Seamless, Eat24, and BiteGrabber. Its founders are Matt Maloney and Mike Evans.
Also known as Roofoods was launched in 2012 by Greg Orlowski and William Shu in London. It focuses on marketing, selling, and helping to deliver restaurant meals from one place to another. Its offices are located in the UAE, Italy, Singapore, Kuwait, Netherlands, Ireland, and Spain. Others are in Hong Kong, Australia, Belgium, Dublin, France, and the US.
Competition in the food delivery marketplace is becoming stiffer daily due to there being so many third-party players, including GrubHub, Deliveroo, UberEats, and others who are also improving their quality of service.
So, if you want to make some extra bucks, you could sign up as a dasher. If you want to increase the revenue of your restaurant, there's an opportunity to sign yourself up and showcase your restaurant to a far larger audience.