Just Eat plc is a British online food order and delivery service. It acts as an intermediary between independent take-out food outlets and customers. It is headquartered in London, England and operates in 13 countries in Europe, Asia, Oceania, and the Americas. Founded in Denmark, the platform enables customers to search for local takeaway restaurants, place orders and pay online, and to choose from pick-up or delivery options.
Just Eat shares have just plummeted as it looks like they will merge with Grubhub.
Was anyone else holding Just Eat taken completely by surprise? Any ideas why the market perceives this to be bad?
So long as they don’t take over foodhub.co.uk ! I used to use JustEat from time to time and always felt a little uncomfortable with them taking percentage commissions from takeaways based on the order value rather than just a fee for handling the transaction. It seemed disproportionate and unfair.
It only feels like 5 minutes ago since JustEat took over HungryHouse in the UK. I’m surprised at just how much consolidation in this market regulators are happy to allow.
Edited to add…
In the UK, Just Eat charges restaurants £699 to join the service, and for each order placed through the website or mobile app, a 13-14% commission. Wikipedia
Surely those rates are a sign that there’s no healthy competition in this area?! They’re obscene!
I have just been slightly burned by this as well. From my understanding in the USA right now there is a bit of a pricing war when it comes to online food delivery businesses. You have doordash, uber, postmates and Grubhub all fighting for marketshare. Which means large spends on advertising and discounts on food etc. So I am guessing that market imagines it will be extremely hard to generate free cashflow.
Very interesting to see how this plays out. The team at Takeaway.com are seriously ambitious, first getting the JustEat Deal done and now this.
The whole sector is a basket case. It seems to be entirely funded by venture capital on the basis of last man standing, and once the monopoly is achieved they raise the rates - but the restaurant can always just walk away so there’s no incentive to sign up for the app/delivery.
I could be wrong but it seems insane