Just Eat Takeaway has been charged at maximum in New York city

J

The city of New York has decided to make the current regulations on meal delivery permanent, including rules on a maximum commission. This may mean end of practice for Just Eat Takeaway.com in New York.

The commission is limited to a maximum of 15%. For platforms that do not deliver themselves, the ceiling is 5 percent of the order. The consumer may be treated separately, but restaurants may not.

The new rules give delivery platforms at the core of the strategy, such as Uber and Dodash, an important competitive advantage over Just Eat Takeaway.com.

Just Eat Takeaway.com acquired Grubhub and charges more than 20 percent commission by default. In 2020, the average was 21 percent of meal sales. That didn’t make Grubhub profitable. That’s why 5 percent is a problem, as sales are down 75 percent. The deliverers can ask the consumer for delivery costs. Just Eat can’t do that under the platform model. They deliver too, but that’s not their strong point or focus of strategy.

CEO Jitse Groen already commented on Twitter that Just Eat Takeaway.com in the outlook already took into account The New York decision and that the CEO will oppose this regulation.

“The big problem is that Uber and Doash were already catching up on Just Eat in New York, and this bill may be the end of just Eat exercise Takeaway.com in New York”, Manders says.

On Friday, the share in Amsterdam closed down about 7.5 percent. New York is expected to account for up to seven percent of Just Eat’s revenue. The price loss is then a lot, since Just Eat can also be right in court and it was already in the outlook.


By: Nicholas de Kramer

Nicholas de Krammer, а self-taught economic analytic with heave mathematical background. Math behind the economics (and economics behind math) is the strong side of the author. Contact him at nicholas.dekramer@economicinform.com

Add comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Recent Posts

Categories

About us

EconomicInform, EconomicInform.com is a product of EconomicInform LLC. We sincerely believe that economics is one of the most interesting and most underappreciated – in terms of getting some enjoyment out of reading the subject articles – sciences. More on that - at the link. Feel free to drop us a line.