Hospitality

Deliveroo launches new Marketplace+ service to let businesses use their own drivers, but is the service “going backwards”?

Dominic Powell /

Deliveroo

Deliveroo Australia country manager Levi Aron (right). Source: Supplied.

Food delivery service Deliveroo is upping the ante in its battle against competitors through a rollout of its brand new Marketplace+ platform that will allow businesses to use their own fleets of riders while still appearing on the service’s app.

The service, which was first rolled out in the UK in June, is launching in Australia this month with the aim of expanding the number of restaurants on the company’s platform to 12,000 by the end of the year.

Businesses will be able to sign up for Marketplace+ with their own fleet of drivers, while also using Deliveroo riders to fill in the gaps, with the company saying the platform will let small food businesses extend their delivery reach and brand recognition due to appearing on the Deliveroo app.

Speaking to SmartCompany, Deliveroo Australia’s country manager Levi Aron says the business considers the launch of Marketplace+ a “win-win-win” for riders, customers and both restaurants on and off the platform.

“We’re looking at the bigger picture, at those restaurants that already do their own delivery, like the Indian place on the corner or the pizza shop down the road. They’re now able to unlock new customers and jump onto a platform they weren’t on before,” he says.

The system will allow restaurants to use their own riders as much or as little as they like, says Aron, and businesses will be able to “switch on” to using Deliveroo’s riders if they find themselves lacking capacity.

“Our aim is to eventually provide customers with almost infinite selection for food any time of the day, which will help Deliveroo scale even further across all regions in Australia,” he says.

This includes regionally, says Aron, who says the new Marketplace+ service will allow Deliveroo to approach businesses it hasn’t been able to before in different regions.

Aron says the fees for using Marketplace+ will be lower than those for businesses on the standard Deliveroo service, but remains tight-lipped on what the exact commission is, instead just saying it is “significantly lower”.

New service “moving backwards”

However, one business owner who already uses the Deliveroo platform is dubious of the new service rollout, believing the company might actually be heading backwards by offering the new service.

Tung Nguyen is the founder of The Art of Fried Chicken, a Melbourne-based fried chicken purveyor, which recently opened its first physical store after existing as a food truck for a number of years.

The Art of Fried Chicken’s first physical store. Source: Supplied.

Nguyen told SmartCompany his business is available on Deliveroo, UberEats and Menulog, and he prefers to use the services due to the significant cost and difficulties involved with providing his own fleet of delivery drivers, although he says business through Deliveroo is “quiet” compared to other services.

“I did the maths, and it works out to be way more costly to do your own because you don’t know how many drivers you need or if you should pay them per delivery or per hour,” he says.

“As far as I see it, you can’t provide your own drivers as a small business unless you’re very well capitalised. I can’t see how a small business could actually afford it.”

The business owner says with even Menulog beginning to offer its own on-demand delivery drivers, Deliveroo’s move into business-supplied drivers is a step backwards, and something he believes businesses won’t be raring to get on board with due to the majority of customers and businesses jumping on the on-demand “trend”.

Both Deliveroo and UberEats take a 35% slice of the businesses order when it’s made through the platform, and while Nguyen notes the cut is quite high, he views it as a “necessary evil” when running a business like his in terms of getting customers and exposure.

Instead of a service like Marketplace+, he’d prefer to see more competitive rates from players such as Deliveroo and more consistent riders and delivery times in Melbourne’s outer suburbs.

“They’re just going backwards,” he says.

Aron disputes this, saying the business views the Marketplace+ launch as a way to expand rather than a return to old ways of food delivery, saying the company was looking at ways to “make ourselves relevant” to more restaurants in more parts of Australia

NOW READ: As Foodora leaves Australia, who’s left? A brief history of Australian food delivery services

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Dominic Powell

Dominic is the features and profiles editor at SmartCompany.

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