An owner of a pizza restaurant in US has been making good money, not just by selling pizzas, but by buying them himself. You heard that right.
He realised that DoorDash food delivery app was selling the food cheaper than he did, and yet he was getting full price, the BBC reported. 'He found out that a pizza for which he charged $24 was being sold for $16 on the app. He then ordered the pizza himself from his own outlet for $16, while his restaurant was paid $24. He later found out it was part of a trial to gauge customer demand.
Content strategist Ranjan Roy first wrote about the incident o his blog. He said that he first came across the incident in March last year when his friend was getting complaints about deliveries, despite his outlets not making any deliveries.
It was then that he discovered that he had been added to the DoorDash app and was being charged less for the pizzas that he sold. So he ordered 10 pizzas, paid $160 and had them delivered to a friend's house, the BBC reported.
The restaurant was then paid $240 for the order by DoorDash. The next order of pizza was received without any toppings, maximising the "profit" from the mismatched prices.
"I was genuinely curious if DoorDash would catch on - but they didn't," wrote Roy wrote.
"They have a test period where they scrape the restaurant's website and don't charge any fees to anyone, so they can ideally go to the restaurant with positive order data to then get the restaurant signed on to the platform.
"Third-party delivery platforms, as they've been built, just seem like the wrong model, but instead of testing, failing, and evolving, they've been subsidised into market dominance.
"You have insanely large pools of capital creating an incredibly inefficient money-losing business model."