The pandemic forced many restaurants to pivot to food delivery, which will make them more reliant on services like DoorDash, GrubHub even after lockdowns lift
Social distancing is pushing restaurants toward delivery-only models powered by tech platforms — Bua Vanitsthian says she's always been passionate about food. Tweets: @modestproposal1 , @ozm , and @dlberes Tweets: Modest Proposal / @modestproposal1 : No restaurant is at the mercy of delivery apps. If the fees charged are too high, they can hire their own delivery people, have a website/app that accepts orders, and acquire customers online like any other business. It's the restaurants choice to participate. OneZero / @ozm : Third-party delivery platforms are seeing record downloads as much of the country stays indoors. Whether this translates into profit for restaurant owners remains to be seen. http://read.medium.com/XqYmV3y Damon Beres / @dlberes : “To make it in a delivery-only world, many restaurants will bet on spaces and apps they don't control. One means of survival is becoming more like a tech company, with venture-backed funds and minimal viable products.” https://onezero.medium.com/...
Context & Ripple Effects
In May 2020, lockdowns pushed restaurants like Bua Vanitsthian's onto delivery-only models just as third-party apps hit record downloads — but the pivot landed on platforms whose economics were already contested. Weeks later, reporting showed Grubhub losing money despite the surge because high fees charged to small restaurants made the delivery business unworkable, and analysts had already flagged that the GrubHub–DoorDash–Postmates–UberEats fight was built on expanding supply and prioritizing growth over profits.
The dependency this article describes has since run both directions: platforms diversified away from restaurant margins, while restaurants searched for exits. In India, operators moved from Zomato and Swiggy to direct-order tools like DotPe for lower commissions and customer data ownership, and by 2024 the pandemic-era ghost-kitchen boom that fed these apps had largely collapsed.
First-order effects
- Restaurants adopting delivery-only models during lockdowns hand their order flow, customer relationships, and margin to DoorDash and GrubHub, whose record download numbers convert directly into negotiating leverage over the venues now dependent on them.
- Operators face the fee structure immediately: the same commissions that make the apps unprofitable for the platforms themselves are what small restaurants pay per order, squeezing already pandemic-stressed unit economics.
Second-order effects
- The fee squeeze creates an opening for direct-ordering tools — the pattern visible in India, where restaurants left Zomato and Swiggy for services like DotPe offering lower commissions and access to customer data — giving independent restaurants a disintermediation path if it travels.
- With restaurant delivery margins thin for everyone, DoorDash and Uber Eats push into groceries and alcohol to find volume that doesn't depend on charging struggling eateries, broadening their role from restaurant middlemen to general last-mile commerce.
Third-order effects
- If reliance outlasts lockdowns, food service splits structurally between restaurants that own their digital storefronts and those renting demand from gatekeeper platforms — with dark kitchens, which serve only delivery customers, as the endpoint of full platform dependence.
- The boom-and-bust of pandemic-era ghost kitchens shows the systemic risk: infrastructure built around platform-mediated demand can collapse when fees, capacity constraints, and consumer habits reset, leaving the most dependent operators exposed.
The trend: Restaurant delivery is consolidating into a platform-dependency model in which apps own the customer relationship and restaurants' ability to exit — via direct ordering or owned channels — determines who captures the margin.