[spywaregorilla]

Pizza packs well, is ordered in large quantities, is easy to store on the seat, is fairly high margin, stacks, and the stores doing this delivery have dedicated drivers with good estimates for how much volume they'll be doing in a night and a fixed supply of drivers with guaranteed wages. They also didn't deliver as far.

App drivers are constantly playing this game of guessing where the next order will come from and where they'll end up.

[Macha]

Also Pizza companies doing their own delivery may be happy with the delivery fee being less than their cost of delivery if it gets them more orders than they would otherwise as long as the order is profitable. e.g. $10 pizza with $2 delivery and $8 cost of production and $3 cost of delivery in range. Each hand picked up pizza makes $2 profit, each pizza delivered makes $1, but if the amount of net new orders from doing delivery is >2x the amount of people that switch from pickup to delivery then the business profits.

In the app case, the business may still benefit (except now the apps have pressure to try extract discounts from the business), but that -$1 for delivery is either being subsidised by VC funding which won't last, or by paying the delivery staff less than their real costs.