Delivery platforms boost restaurant profits in Europe

Uber Eats, a unit of the ride-hailing service, Britain’s Deliveroo and Spain’s Glovo expanded the market by supplying their own delivery to chain restaurants. (Reuters/File)
Updated 02 December 2019

Delivery platforms boost restaurant profits in Europe

  • We are in front of a big business opportunity, says Uber Eats’ European head

LONDON: Food delivery platforms are helping independent and chain restaurants in London, Paris, Madrid and Warsaw serve more meals every week, boosting the sector’s revenue and profit, according to a Deloitte report commissioned by Uber Eats.

Food delivery has grown rapidly across Europe, initially driven by companies such as Just Eat and Takeaway.com that offered marketplaces for restaurants that had their own delivery services.

Uber Eats, a unit of the ride-hailing service, Britain’s Deliveroo and Spain’s Glovo expanded the market by supplying their own delivery to both independent and chain restaurants.

The share of restaurants that reported an overall increase in sales after joining the Uber Eats was 69 percent in London, 74 percent in Paris, 67 percent in Warsaw and 59 percent in Madrid, according to the report.

Uber Eats’ European head Stephane Ficaja said the survey was commissioned to gauge the impact the company was having on the 60,000 restaurants that had joined its platform in 250 cities across Europe in little over three years.

“We were hoping to see top line and bottom line growth, that means that restaurants generate not only more revenue thanks to food delivery but also more profit,” he said in an interview.

The growth was seen by small independents and big chains, which were able to compete on a level playing field on the platform, he said.

The biggest number of extra meals delivered as a result of third-party platforms was seen in London, where 606,000 servings were made by chain restaurants and 305,000 through independents weekly, resulting in a £323 million ($414 million) increase in annual revenue and £189 million of extra profit a year, it said.

A 4.7 percent rise in meals served was seen in Paris, while there was a 1.5 percent increase across the board in Madrid and a 1.9 percent rise in Warsaw, the survey found.

The food delivery sector has already started to consolidate, and two Netherlands-based companies — Just Eat and Prosus — are competing to buy Britain’s Just Eat.

Uber Eats, like its parent, is loss making. Its revenue increased by 64 percent to $645 million in the third quarter but its loss on the adjusted earnings level widened by 67 percent to $316 million.

“We are still in front of a big business opportunity. We still have a lot of markets where delivery is not mature where we need to invest,” Ficaja said.


China's aviation regulator raised concerns with Boeing on 737 MAX design changes

Updated 12 December 2019

China's aviation regulator raised concerns with Boeing on 737 MAX design changes

  • China is reviewing the airworthiness of the plane
  • China was first country to ground plane in March

BEIJING: China’s aviation regulator raised “important concerns” with Boeing Co. on the reliability and security of design changes to the grounded 737 MAX, it said on Thursday, but declined to comment on when the plane might fly again in China.
China is reviewing the airworthiness of the plane based on proposed changes to software and flight control systems according to a bilateral agreement with the United States, Civil Aviation Administration of China (CAAC) spokesman Liu Luxu told reporters at a monthly briefing.
He reiterated that for the plane to resume flights in China, it needed to be re-certified, pilots needed comprehensive and effective training to restore confidence in the model and the causes of two crashes that killed 346 people needed to be investigated with effective measures put in place to prevent another one.
China was the first country to ground the 737 MAX after the second crash in Ethiopia in March and had set up a task force to review design changes to the aircraft that Boeing had submitted.
The US Federal Aviation Administration (FAA) will not allow the 737 MAX to resume flying before the end of 2019, its chief, Steve Dickson, said on Wednesday.
Once the FAA approves the reintroduction into service, the 737 MAX can operate in the United States, but individual regulators could keep the planes grounded in other countries until they complete their own reviews.
“Due to the trade war, the jury is still out on when China would reintroduce the aircraft,” said Rob Morris, Global Head of Consultancy at Ascend by Cirium.
Chinese airlines had 97 737 MAX jets in operation before the global grounding, the most of any country, according to Cirium Fleets Analyzer.