[gruez]

> I don't know what the app/driver split is, but in developing countries, the total fees are typically $1-2 for food delivery on Grab, Food Panda, Gojek, etc.

But how much are the drivers making? If labor is dirt cheap there it's not surprising at all that they can offer delivery for $1-$2. I find it strange how you went from "developing countries, the total fees are typically $1-2 for food delivery" to "there's no reason they need anywhere close to what they're charging in the US and similar countries" without at least doing a cursory analysis of the labor costs.

[Dudhbbh3343]

Because even if we assume the labor costs are zero in the developing countries, that means the platform is only earning a couple dollars per order.

But the original article suggests that Door Dash is making over $10 an order (after labor costs), which is 5x over the best case scenario for the developing countries' apps.

[gruez]

> Because even if we assume the labor costs are zero in the developing countries, that means the platform is only earning a couple dollars per order.

1. That's gross profit, and doesn't cover stuff like marketing spend, which presumably is also more expensive in developed countries. If you look at the linked financial report, just under "Gross Margin" (and is cropped out) is "sales and marketing", which is nearly half of the gross margin.

2. The $10/order profit figure in the report includes restaurant fees as well. If you exclude that, their revenue (ie. all fees charged), and their profit (ie. revenue minus whatever they paid to the driver) drops by two-thirds.

Taking the two factors into account the doordash premium (for lack of a better term) over the Asian delivery companies decreases significantly. If you factor other expenses (eg. customer support/admin) and/or factors (eg. whether the Asian delivery companies are currently trying to gain marketshare as opposed to trying to take profits) probably decreases the discrepancy even further.