DoorDash pushing new “DoorDash Self-Delivery” as last-mile logistics war heats up in the US

The program allows restaurants and other providers to list their products on the DoorDash platform, but fulfil the order using their own delivery networks.

In exchange, DoorDash will take a reduced commission, and allow the restaurant’s delivery drivers to collect and keep whatever tips may be earned in the process of fulfilling the order. DoorDash offers the ability to integrate traditional DoorDash delivery drivers to complement the restaurant’s in-house delivery system but at the traditionally higher commission rate. DoorDash pitches this change to restaurants as a way to better control their customers' delivery experience.

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In reality, the move is meant to keep restaurants from pulling out of the system entirely to control the costs of third party delivery. I don’t have any information to say whether this program is being offered here, or whether any of the other competitors are offering a similar program to Filipino restaurants, but this major shift is something worth watching in case it's successful and is adopted here.

When the lockdowns first started, the third-party delivery apps in the Philippines had the upper-hand on pricing and commissions.

Established giants like Jollibee [JFC 197.00 0.10%] and McDonald’s [AGI 10.00 1.38%] were caught half-dressed with in-house delivery systems tuned to the pre-COVID world of 80% dine-in and 20% dine-out; when that ratio flipped due to COVID movement restrictions and contagion fears, the stores realized that they would need to ramp up delivery capacity to serve the future post-COVID demand of that segment.

For McDonald’s, the initial commission level of 18% was alarming and pushed the company to consider going full in-house delivery. A move like this from our 3rd party delivery apps, featuring reduced commissions, might help convince McDo to stay in the app ecosphere, rather than doing its own thing.

This is a good move for consumers, as it (theoretically) makes JFC and McDonald’s products more readily available on a wider range of platforms, and it may be a good move for the quick service restaurants as it could provide them with a means of reducing commissions while maintaining an efficient level of delivery staffing by availing of  “surge support” from the aggregators during times of higher-order flow. We’ll have to see how this actually plays out. 

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