Orders for delivery of takeout food via mobile app have reportedly slipped as restaurants have raised prices and some delivery companies have boosted their fees in an inflationary environment.
Higher prices have added to the pressures delivery companies were already facing as the pandemic-driven lockdowns — which drove orders for home delivery of prepared food — came to an end, the Financial Times reported Friday (Oct. 21), citing the recent earnings results of Deliveroo and Just Eat Takeaway as well as an interview with food industry consultant Peter Backman.
“People aren’t going to casual dining chains in the numbers that they were and that’s only going to get worse,” Backman said in the report, adding that the cost to the customers has gone up as some restaurants have raised prices and some apps have raised fees to boost earnings.
Deliveroo’s orders declined 1% year over year during the quarter ended Sept. 30, the company reported Friday in its Q3 2022 Trading Update, with Deliveroo Founder and CEO Will Shu mentioning “the ongoing economic uncertainty.”
At Just Eat Takeaway, the parent company of Grubhub, global orders dropped 11% year over year during the same quarter, the company said Wednesday (Oct. 19) in a press release.
Commenting on the results for the quarter, Just Eat Takeaway CEO Jitse Groen noted in the press release that “the consumer backdrop will likely be challenging due to the macro-economic environment.”
Despite the drops in orders, Just Eat Takeaway achieved profitability in the quarter due to cost reduction efforts, including a hiring freeze, as PYMNTS reported Wednesday.
Deliveroo benefited from gains in its grocery delivery business, which has performed better than restaurants in terms of growth in the number of orders, as PYMNTS reported Friday.