DoorDash Puts Delivery on the Menu for Small Restaurants
Most of us have that one favorite restaurant that we know about, but a lot of people don’t. It’s not a national chain, but rather a privately-owned operation that makes you believe in America’s small businesses again. Yet even these inspirational wonders of the American culinary landscape still find themselves struggling against big business, and the combination of the small restaurant and DoorDash—which opens up delivery for just about any restaurant—is proving a winner.
DoorDash has become increasingly prominent over the years, and recently landed a funding round worth $250 million thanks to investors like DST Global and Coatue Management. With a $535 million funding round recently preceding that $250 million—the company is now valued at $1.4 billion—it’s clear that DoorDash is proving a viable alternative to restaurants setting up their own delivery services.
With this new funding, DoorDash has expanded its business and added new features, like the DashPass system. DashPass is a subscription service—just $9.99 a month—that offers free delivery from a range of delivery options, including Wendy’s and the Cheesecake Factory. Plus, it’s been stepping up its delivery range, with a plan to be in 2,000 cities by the end of the year.
The earlier expansions have already paid off for DoorDash; it’s the fastest-growing last-mile logistics platform in the United States thanks to growth of 250 percent over last year’s figures.
However, there are signs the company may have grown too fast for its own good. Some small restaurants, like Darci’s Bacon Blues in Cape Canaveral, report that DoorDash added the restaurant without its consent or even knowledge. Owner Darci Kropp found out the hard way when she kept getting calls about orders for delivery that never arrived. The problem here was that Darci’s Bacon Blues doesn’t offer delivery, yet DoorDash seems to have claimed it did.
This is a major problem for small restaurants; DoorDash is a great way to get into the delivery market, but for those who don’t want to—some food just doesn’t travel well—being enrolled without consent can lead to serious problems with potential customers. Who won’t be eating at Darci’s Bacon Blues ever again after getting stiffed on a delivery they should have never made?
That’s a big potential cost to restaurants, and one that DoorDash needs to address promptly.