DoorDash president unsure 15-minute delivery a viable business model

At a conference last week, Christopher Payne, president of DoorDash said that while consumers love 15-minute delivery he isn’t sure that it is a money making venture.

Restaurant delivery giant DoorDash is tentatively testing ultra-fast delivery with Albertsons and other chains in New York City and other US cities.

“I don’t know where the edge is,” Christopher Payne said on Tuesday during a keynote discussion at the Shoptalk retail conference. “All of us are beginning to test the boundaries. Does 15 minutes matter? Does 30 minutes matter? Can you make the economics work at those service levels?”

Payne admitted that unless a company gets the logistics right it can cost a lot of money with little in the way of returns. “I think you’ll see people come and go in that space,” Payne said during the fireside chat this week at the Mandalay Bay hotel in Las Vegas.

DoorDash moved into 15-minute delivery with its ‘DashMart’ dark store customer fulfilment centres in New York City. In February it then partnered with Albertsons to offer half-hour delivery from 330 of its stores in more than 20 cities across the US.

“Can we make it work in 15 minutes? We don’t know yet. I’m confident though that there’s positive signs to suggest we can,” he said. Payne said that customers love the service but he remains doubtful of its potential as a major income stream.

The news comes as GoPuff, an international fast-delivery company has announced it is to cut 3% of its workforce to reduce outgoings by US $40 million annually. One thing is clear – in the five or so years since the concept was first tested, no fast-delivery company has made money despite minimising costs such as pay for their couriers.

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