The Bank of England plans to keep interest rates at a record low until unemployment falls to 7% - something unlikely for another three years - in a major new departure for British monetary policy.
Barely a month after Canadian Mark Carney took over from the long-serving Mervyn King as BoE governor, the central bank said on Wednesday that it would keep interest rates at 0.5 percent unless inflation threatened to get out of control or there was a danger to financial stability
Unemployment went below 7% just five months later and it kept on falling. Today it stands at 3.8%.
The issue then was that we imported a lot of deflation from China. Raising interest rates may have ended up causing deflation.
There was also a truly massive deflationary effect from the gradual unwinding of the mountains of "fantasy money" that had been created on the back of CDOs and similar financial products post 2008 which went on for several years. That came close to driving several parts of the world into deflation and the EZ dipped into it more than once.
The British jobs miracle, post 2012, however, remains largely unexplained. Why did it happen here? How did so little of that growth end up being reflected in GDP? Are our GDP figures correct? What policies do we need to sustain high employment? Can we improve productivity within that mix? Are we right about productivity? The reason it is found to be so low is that we effectively divide the number of people in work by the output. As that number went up and the measured output didn't productivity fell, but did it?
These are not just historical issues. They are right at the centre of the economic challenges we face today. I am not sure I believe the official figures.
Surely this one is pretty simple. Different jobs deliver different levels of economic output. The "jobs miracle" delivered an awful lot of low paid low output low security jobs. Whilst I have a lot of respect for the physical effort made by the Uber Eats cyclists delivering people's booze and crisps order its hardly GDP-generating.
What we need to do - as has been the case for the lost decade back to 2012 - is invest in training and skills and manufacturing. Make more stuff, improve balance of payments, increase disposable incomes - the virtuous circle.
The problem is that in the 2008 era we replaced capitalism with bankism. Borrow cheap money, invest it, deliver a return on investment, reinvest the profits is now seen as "who will pay for it" subsidy.
But why did noone else in the EZ produce jobs like we did? That is the mystery. Our employment laws were largely set to European standards. We had a relatively high and increasing minimum wage (Germany didn't even have one for nearly all of that period). And the money spent on takeaways and deliveries was substantial in cumulo and should have boosted GDP by more than it did. My speculation is that we are not very good at measuring that kind of spending, partly because there is significant under declaration of it. We get the employment part because people need to be registered to get in work benefits but the money taken largely disappears from the figures.
Universal credit, and the easy availability of casual work also helped. RochdalePioneers and BartholomewRoberts also raise good points about the need to treat human capital as valuable, and invest in training and development. At the bottom end of the labour market, we now no longer have virtually unlimited supply, so there will be a need to replace labour with capital as the cost of labour rises.
Yes, some businesses will find things difficult in this new environment, but no-one bar a few VC investors ever thought that delivering a can of coke and a packet of crisps to someone’s front door, was ever going to be a profitable business model. Nor washing cars inside and out for a tenner.
Remember what the business model is. Create a new business - "DeliverCo" - which when you sift past all the guff about technology pays the desperate by the hour to cycle through the rain delivering stuff from your corner shop you can no longer be arsed to walk to.
DeliverCo needs to grow market share vs ShiftCo and StuffCo, so offers not just free delivery but a fucking discount on the stuff they are delivering. Shows HUUUUUUGE growth which brings in money from other VC people to grow the business. More market share makes VC investment worth £more - they cash out with a massive profit whilst others pile in. Rinse and repeat.
Frankly they may as well all deliver Tulip Bulbs - its about as sustainable a business model. There is no future in most of these companies. No viable way to make actual money cycling around your £9 beer and crisps order from Tesco Express. Its a get rich quick scheme for investors literally making money off the backs of the people with Deliveroo boxes strapped onto them.
A rare point on which you and I can agree entirely. (AIUI, you come from a food background, and I come from an IT/tech background).
While I can just about understand the business model of Uber, trying to undercut the competition to get a monopoly, at which point they can raise prices as monopolies do, there’s a very high price electricity of demand for deliveries of small grocery orders. No-one is ever going to pay £10 for delivery of beer and crisps, except for those in rural areas where the business model makes no sense anyway, and for the home drinkers on a Saturday night, who can’t face a 10 minute walk or a 5 minute drive to the local shop.
See my earlier post on this thread from a Deliveroo customer's point of view. Briefly I pay £5 for fish and chips to be delivered. This saves me £5 in cab fares, so it is cost neutral to me as a customer. I do not use Deliveroo for groceries but if I did, then it would be offset against the bus fare to and from the shops. Whether there is a sustainable business model underlying this, I do not know.
Yes, you’re paying £5 for Deliveroo to deliver your fish and chips. But their costs of that delivery are £8, and the driver is a contractor earning under minimum wage after his own expenses. If the delivery charge were to be £10 or £12, a level at which they are a sustainable company paying employees, would you still be willing to pay it?
Is it though? Surely it depends how many deliveries each driver makes in an hour. It is not immediately obvious why £5 for Deliveroo to drive my fish and chips is less sustainable than £5 for a minicab to make the same journey. You might well be right, especially as the people at the top are no doubt paying themselves well.
Maybe our inflation will be transitory, gas prices have dropped to pre-Putin being a wanker levels and there's still significantly more LNG shipments to come. Good news for European countries which use the Zeebrugge gas terminal for supply as we're in a huge surplus for the next few months at least. If ever there was a moment to cut Russian gas it's now.
Cue a moronic post from Ishmael about reverse mnemonics.
No, it's not 'exactly right' you discourteous sod!
My surname being a homophone of Lee, I am somewhat inured to misspellings. (I assume auto doxxing is within the rules)
I do love reverse mnemonics though, gonna publish a book of them. BronZe has Zinc in it. Pouilly Fuisse vs Pouilly Fume? Pouilly FuiSSe is the Sauvignon one, obv. etc.
Mr. Eabhal, given food banks arose during the boom under Blair, and use has increased under the recession, recovery, and since, it does seem that food banks are just on the up regardless of the broader economic picture.
Two words: Universal Credit.
Wasn't it rolled out over a period? Which would also tend to confuse the picture.
Yep Universal Credit is paid in arrears - which isn't much use if you are suddenly unemployed because your employer has gone bankrupt before paying you.
But its a good thing that its paid in arrears, as wages are paid in arrears, so if you are suddenly employed and have to sign off then you're screwed if you got your benefits up-front.
UC in arrears, but the ability to get money up-front if you need it (which has been the case for years now) is less of a barrier to people signing off than UC up-front is.
But they do take money from the food... So if you order £40 of food from a restaurant, Deliveroo might take £12 in commission, charge you £4-£5 for delivery/service fees and pay the delivery driver about £3 because they're expected to do 3-4+ deliveries per hour.
Their business model doesn't just rely upon beggaring their delivery drivers, they also do the same for the restaurants too.
The Deliveroo Editions site at Cranford Way, north London, sits at the back of an electricity substation, sandwiched between a boxing gym on one side and some overgrown scrub on the other... Other Deliveroo Editions sites in the UK can be found at the back of industrial estates or below traffic flyovers. They typically consist of up to 16 metal boxes roughly the size of shipping containers, packed on to a patch of asphalt with generators humming in between... From here, offerings from Pizza Express, Shake Shack and “Cluckleberry Finn Fried Chicken” – a delivery-only outfit that you won’t find anywhere outside Deliveroo’s app – are pumped out into the city...
“Dark kitchens” are places where meals are prepared entirely for delivery... the idea of gearing them towards home takeaways is relatively recent. It’s a leap that has only been made possible by the rise of food delivery platforms, and the global leader of the concept is Deliveroo, which opened its first dark kitchen in London in 2016. Today, the company boasts 250 in eight countries, each of them home to a fluid array of tenants, including international chain restaurants, tentative startups and virtual brands, some of which might “exist” on the app for just a few weeks.
To many, the notion of a whole host of different cuisines emerging from the same kitchen – with a chef simultaneously preparing a pizza on one work surface and a Sichuan hot pot on another – feels unsettling, but it reflects the logic of the abstracted digital marketplace; the New Yorker recently described dark kitchens as “the culinary equivalent of a multicolour retractable pen”. To make a success of the operation you need to know what colour to push and that’s where Deliveroo’s vast stores of data come to the fore. “Using our own technology, we can identify specific local cuisines missing in an area, identify customer demand for that missing cuisine and handpick brands that are most likely to appeal to customers in that area,” Deliveroo’s former property acquisitions manager, Patrick Weiss, speaking in 2017,has said.
As the firm’s prospectus for its flotation reveals, Editions lie at the heart of Deliveroo’s vision of the future and its plan to win the delivery-app wars. “With unparalleled global expertise, we are uniquely positioned to scale this concept,” the company claims, and many investors agree. “Deliveroo already has a great database of consumer preferences,” says Ioannis Pontikis, an equity analyst for the financial services firm Morningstar. “And once you’ve set up a dark kitchen, it’s very easy to trial new brand ideas, new food concepts, new marketing and promotions.” Pontikis points out that dark kitchens don’t only have an edge over bricks-and-mortar restaurants when it comes to generating demand: they also benefit from better unit economics – ie a lower cost for each meal produced.
The Bank of England plans to keep interest rates at a record low until unemployment falls to 7% - something unlikely for another three years - in a major new departure for British monetary policy.
Barely a month after Canadian Mark Carney took over from the long-serving Mervyn King as BoE governor, the central bank said on Wednesday that it would keep interest rates at 0.5 percent unless inflation threatened to get out of control or there was a danger to financial stability
Unemployment went below 7% just five months later and it kept on falling. Today it stands at 3.8%.
The issue then was that we imported a lot of deflation from China. Raising interest rates may have ended up causing deflation.
There was also a truly massive deflationary effect from the gradual unwinding of the mountains of "fantasy money" that had been created on the back of CDOs and similar financial products post 2008 which went on for several years. That came close to driving several parts of the world into deflation and the EZ dipped into it more than once.
The British jobs miracle, post 2012, however, remains largely unexplained. Why did it happen here? How did so little of that growth end up being reflected in GDP? Are our GDP figures correct? What policies do we need to sustain high employment? Can we improve productivity within that mix? Are we right about productivity? The reason it is found to be so low is that we effectively divide the number of people in work by the output. As that number went up and the measured output didn't productivity fell, but did it?
These are not just historical issues. They are right at the centre of the economic challenges we face today. I am not sure I believe the official figures.
Surely this one is pretty simple. Different jobs deliver different levels of economic output. The "jobs miracle" delivered an awful lot of low paid low output low security jobs. Whilst I have a lot of respect for the physical effort made by the Uber Eats cyclists delivering people's booze and crisps order its hardly GDP-generating.
What we need to do - as has been the case for the lost decade back to 2012 - is invest in training and skills and manufacturing. Make more stuff, improve balance of payments, increase disposable incomes - the virtuous circle.
The problem is that in the 2008 era we replaced capitalism with bankism. Borrow cheap money, invest it, deliver a return on investment, reinvest the profits is now seen as "who will pay for it" subsidy.
But why did noone else in the EZ produce jobs like we did? That is the mystery. Our employment laws were largely set to European standards. We had a relatively high and increasing minimum wage (Germany didn't even have one for nearly all of that period). And the money spent on takeaways and deliveries was substantial in cumulo and should have boosted GDP by more than it did. My speculation is that we are not very good at measuring that kind of spending, partly because there is significant under declaration of it. We get the employment part because people need to be registered to get in work benefits but the money taken largely disappears from the figures.
Universal credit, and the easy availability of casual work also helped. RochdalePioneers and BartholomewRoberts also raise good points about the need to treat human capital as valuable, and invest in training and development. At the bottom end of the labour market, we now no longer have virtually unlimited supply, so there will be a need to replace labour with capital as the cost of labour rises.
Yes, some businesses will find things difficult in this new environment, but no-one bar a few VC investors ever thought that delivering a can of coke and a packet of crisps to someone’s front door, was ever going to be a profitable business model. Nor washing cars inside and out for a tenner.
Remember what the business model is. Create a new business - "DeliverCo" - which when you sift past all the guff about technology pays the desperate by the hour to cycle through the rain delivering stuff from your corner shop you can no longer be arsed to walk to.
DeliverCo needs to grow market share vs ShiftCo and StuffCo, so offers not just free delivery but a fucking discount on the stuff they are delivering. Shows HUUUUUUGE growth which brings in money from other VC people to grow the business. More market share makes VC investment worth £more - they cash out with a massive profit whilst others pile in. Rinse and repeat.
Frankly they may as well all deliver Tulip Bulbs - its about as sustainable a business model. There is no future in most of these companies. No viable way to make actual money cycling around your £9 beer and crisps order from Tesco Express. Its a get rich quick scheme for investors literally making money off the backs of the people with Deliveroo boxes strapped onto them.
A rare point on which you and I can agree entirely. (AIUI, you come from a food background, and I come from an IT/tech background).
While I can just about understand the business model of Uber, trying to undercut the competition to get a monopoly, at which point they can raise prices as monopolies do, there’s a very high price electricity of demand for deliveries of small grocery orders. No-one is ever going to pay £10 for delivery of beer and crisps, except for those in rural areas where the business model makes no sense anyway, and for the home drinkers on a Saturday night, who can’t face a 10 minute walk or a 5 minute drive to the local shop.
See my earlier post on this thread from a Deliveroo customer's point of view. Briefly I pay £5 for fish and chips to be delivered. This saves me £5 in cab fares, so it is cost neutral to me as a customer. I do not use Deliveroo for groceries but if I did, then it would be offset against the bus fare to and from the shops. Whether there is a sustainable business model underlying this, I do not know.
Yes, you’re paying £5 for Deliveroo to deliver your fish and chips. But their costs of that delivery are £8, and the driver is a contractor earning under minimum wage after his own expenses. If the delivery charge were to be £10 or £12, a level at which they are a sustainable company paying employees, would you still be willing to pay it?
Is it though? Surely it depends how many deliveries each driver makes in an hour. It is not immediately obvious why £5 for Deliveroo to drive my fish and chips is less sustainable than £5 for a minicab to make the same journey. You might well be right, especially as the people at the top are no doubt paying themselves well.
Because your local cab driver isn’t advertising at the Super Bowl, nor does he have a couple of thousand software developers and lawyers working for him.
As @BartholomewRoberts also points out, the relationship between Deliveroo and the restaurant is not exactly favourable to the latter either. They’re taking commission from both sides, but still can’t make a profit.
Bolton North East, top Labour target. These were the local election votes in the constituency:
Con 10,485 Lab 9,870 Reform UK 1,465 LD 1,220 Green 441 Ind 92
Used to live there. It's a strange seat. Half strongly Labour. Half strongly Tory. You can literally observe this change as you go uphill out of town on the Halliwell or Blackburn Roads. The ringroad and Astley Bridge ASDA (scene of the "heavy duty black bin bags" song) marks the real boundary. Labour Bolton results were poor.
On a similar note, I was talking to an energy sector person this morning and I asked him why the UK and Belgium don't just double then triple the supply from the UK into Zeebrugge. The answer, perhaps unsurprisingly, was that major European countries (code for Germany and France) didn't want to become dependent on the UK for gas supplies so the demand for gas from there was never high enough to warrant investment. Completely mad when put into the context of NS and NS2 being approved.
Mr. Eabhal, given food banks arose during the boom under Blair, and use has increased under the recession, recovery, and since, it does seem that food banks are just on the up regardless of the broader economic picture.
Two words: Universal Credit.
Wasn't it rolled out over a period? Which would also tend to confuse the picture.
And wherever and whenever it was rolled out, food bank use sky-rocketed. Thanks to the bizarre delay in the first payment plus aggressive and arbitrary sanctions regime, primarily, I believe.
I looked into that too. Plenty of anecdotal evidence (which is enough, sometimes) but not coming up in the data.
Loads of confounding factors and as @Carnyx points out, the rollout confuses everything.
Edit: agree that the 5 week wait is a real problem though. Two -child limit is the real killer for child poverty.
The 5 week wait was abolished years ago. They give an up-front payment for people signing up now, which is then taken back in slightly reduced payments over 12 months - even if people then sign off they still get to keep the up-front payment I believe.
No it wasn't and it hasn't. You can apply for it. But no one tells you you can.
Btw, there is a reverse causality/vicious cycle where obesity leads to poverty.
Health issues = less work. Social stigma against overweight people, particularly women.
Nonsense.
Image search suggests that is not a photoshop. Wow.
Suggests a man who can’t control his appetites in more ways than one
He can afford a personal trainer and a personal gym, yet he’s dangerously obese. There must be an actuarial risk he won’t make it in total health to 2024
The Bank of England plans to keep interest rates at a record low until unemployment falls to 7% - something unlikely for another three years - in a major new departure for British monetary policy.
Barely a month after Canadian Mark Carney took over from the long-serving Mervyn King as BoE governor, the central bank said on Wednesday that it would keep interest rates at 0.5 percent unless inflation threatened to get out of control or there was a danger to financial stability
Unemployment went below 7% just five months later and it kept on falling. Today it stands at 3.8%.
The issue then was that we imported a lot of deflation from China. Raising interest rates may have ended up causing deflation.
There was also a truly massive deflationary effect from the gradual unwinding of the mountains of "fantasy money" that had been created on the back of CDOs and similar financial products post 2008 which went on for several years. That came close to driving several parts of the world into deflation and the EZ dipped into it more than once.
The British jobs miracle, post 2012, however, remains largely unexplained. Why did it happen here? How did so little of that growth end up being reflected in GDP? Are our GDP figures correct? What policies do we need to sustain high employment? Can we improve productivity within that mix? Are we right about productivity? The reason it is found to be so low is that we effectively divide the number of people in work by the output. As that number went up and the measured output didn't productivity fell, but did it?
These are not just historical issues. They are right at the centre of the economic challenges we face today. I am not sure I believe the official figures.
Surely this one is pretty simple. Different jobs deliver different levels of economic output. The "jobs miracle" delivered an awful lot of low paid low output low security jobs. Whilst I have a lot of respect for the physical effort made by the Uber Eats cyclists delivering people's booze and crisps order its hardly GDP-generating.
What we need to do - as has been the case for the lost decade back to 2012 - is invest in training and skills and manufacturing. Make more stuff, improve balance of payments, increase disposable incomes - the virtuous circle.
The problem is that in the 2008 era we replaced capitalism with bankism. Borrow cheap money, invest it, deliver a return on investment, reinvest the profits is now seen as "who will pay for it" subsidy.
But why did noone else in the EZ produce jobs like we did? That is the mystery. Our employment laws were largely set to European standards. We had a relatively high and increasing minimum wage (Germany didn't even have one for nearly all of that period). And the money spent on takeaways and deliveries was substantial in cumulo and should have boosted GDP by more than it did. My speculation is that we are not very good at measuring that kind of spending, partly because there is significant under declaration of it. We get the employment part because people need to be registered to get in work benefits but the money taken largely disappears from the figures.
Universal credit, and the easy availability of casual work also helped. @RochdalePioneers and @BartholomewRoberts also raise good points about the need to treat human capital as valuable, and invest in training and development. At the bottom end of the labour market, we now no longer have virtually unlimited supply, so there will be a need to replace labour with capital as the cost of labour rises.
Yes, some businesses will find things difficult in this new environment, but no-one bar a few VC investors ever thought that delivering a can of coke and a packet of crisps to someone’s front door, was ever going to be a profitable business model. Nor washing cars inside and out for a tenner.
Remember what the business model is. Create a new business - "DeliverCo" - which when you sift past all the guff about technology pays the desperate by the hour to cycle through the rain delivering stuff from your corner shop you can no longer be arsed to walk to.
DeliverCo needs to grow market share vs ShiftCo and StuffCo, so offers not just free delivery but a fucking discount on the stuff they are delivering. Shows HUUUUUUGE growth which brings in money from other VC people to grow the business. More market share makes VC investment worth £more - they cash out with a massive profit whilst others pile in. Rinse and repeat.
Frankly they may as well all deliver Tulip Bulbs - its about as sustainable a business model. There is no future in most of these companies. No viable way to make actual money cycling around your £9 beer and crisps order from Tesco Express. Its a get rich quick scheme for investors literally making money off the backs of the people with Deliveroo boxes strapped onto them.
Its certainly possible for companies to make a profit from people making home deliveries of food, Domino's Pizza* is a very profitable business that does precisely that.
The question is getting the balance of costs right. That's never going to be profitable for delivering crisps and a coke, it can be profitable if you're delivering a significant order though.
The question as with many things is about getting the pricing right. It won't happen for "free". There's a reason why Domino's will charge £19 for a pizza with "free delivery", but have a collection "promotion" reducing the price to £9.99 if you collect it.
* Other food delivery companies are available.
We're talking about two different kinds of business. One is the producer - like a Dominos - who offer a delivery service. The other is Deliveroo who collect food from the producer - like Dominos - and deliver it for a fee.
Dominos can afford to subsidise the cost of delivery via the profits made producing the food. Deliveroo et al cannot. They produce nothing, they simply shift product from a to b. Without the ability to make a profit on the produced item there is nothing to subsidise the operation with other than VC cash injections.
But they do take money from the food.
Deliveroo have a very sneaky business model and they actually take money many ways if you read up on it.
They approach restaurants, many of whom are desperate for the cash, and say to them "your kitchen is open anyway, we'll bring orders to you and we'll take a 30% commission". As such the price you're paying for the food, much of it isn't going to the food.
Then they tell customers that the customers need to pay a "service charge". In fact Deliveroo now charges two service charge fees they add on top of the food prices, of which they're taking a commission.
So if you order £40 of food from a restaurant, Deliveroo might take £12 in commission, charge you £4-£5 for delivery/service fees and pay the delivery driver about £3 because they're expected to do 3-4+ deliveries per hour.
Their business model doesn't just rely upon beggaring their delivery drivers, they also do the same for the restaurants too.
Having created a business model for a dark kitchen operation which uses outfits like Deliveroo I do understand their business model! I wonder what direct involvement you have in this industry that I do not have...?
Again, Deliveroo Do Not Make Money From Producing Food.
There is a service charge that gets made against the producing restaurant / take-away / dark kitchen. That is a cost of business, it isn't a cut from their profits, its a reduction in their profits.
If you are Dominos or even your local curry house, you may pay a similar cost of getting deliveries out. But you profit from the food. So it doesn't matter if the delivery operation loses money as long as you are up overall.
What you are missing is that the model for delivery only - like Deliveroo - does not work without regular injections of cash. Even with the revenue stream of taking a % from food producers they lose £1 per delivery (Deliveroo figures) - the more they grow the more £ they lose. The reason why share prices are tanking with all of these businesses is that investors are starting to ask questions about how the business makes money and don't like the answers.
Bethany Black twitch.tv/beffernieblack @BeffernieBlack · 17m I would like to apologise to the Tory party, I was wrong, after your ability to organise piss ups and get laid in brothels I thought I had the analogy down, but it turns out you *could* organise a buffet in a food bank.
The Bank of England plans to keep interest rates at a record low until unemployment falls to 7% - something unlikely for another three years - in a major new departure for British monetary policy.
Barely a month after Canadian Mark Carney took over from the long-serving Mervyn King as BoE governor, the central bank said on Wednesday that it would keep interest rates at 0.5 percent unless inflation threatened to get out of control or there was a danger to financial stability
Unemployment went below 7% just five months later and it kept on falling. Today it stands at 3.8%.
The issue then was that we imported a lot of deflation from China. Raising interest rates may have ended up causing deflation.
There was also a truly massive deflationary effect from the gradual unwinding of the mountains of "fantasy money" that had been created on the back of CDOs and similar financial products post 2008 which went on for several years. That came close to driving several parts of the world into deflation and the EZ dipped into it more than once.
The British jobs miracle, post 2012, however, remains largely unexplained. Why did it happen here? How did so little of that growth end up being reflected in GDP? Are our GDP figures correct? What policies do we need to sustain high employment? Can we improve productivity within that mix? Are we right about productivity? The reason it is found to be so low is that we effectively divide the number of people in work by the output. As that number went up and the measured output didn't productivity fell, but did it?
These are not just historical issues. They are right at the centre of the economic challenges we face today. I am not sure I believe the official figures.
Surely this one is pretty simple. Different jobs deliver different levels of economic output. The "jobs miracle" delivered an awful lot of low paid low output low security jobs. Whilst I have a lot of respect for the physical effort made by the Uber Eats cyclists delivering people's booze and crisps order its hardly GDP-generating.
What we need to do - as has been the case for the lost decade back to 2012 - is invest in training and skills and manufacturing. Make more stuff, improve balance of payments, increase disposable incomes - the virtuous circle.
The problem is that in the 2008 era we replaced capitalism with bankism. Borrow cheap money, invest it, deliver a return on investment, reinvest the profits is now seen as "who will pay for it" subsidy.
But why did noone else in the EZ produce jobs like we did? That is the mystery. Our employment laws were largely set to European standards. We had a relatively high and increasing minimum wage (Germany didn't even have one for nearly all of that period). And the money spent on takeaways and deliveries was substantial in cumulo and should have boosted GDP by more than it did. My speculation is that we are not very good at measuring that kind of spending, partly because there is significant under declaration of it. We get the employment part because people need to be registered to get in work benefits but the money taken largely disappears from the figures.
Universal credit, and the easy availability of casual work also helped. RochdalePioneers and BartholomewRoberts also raise good points about the need to treat human capital as valuable, and invest in training and development. At the bottom end of the labour market, we now no longer have virtually unlimited supply, so there will be a need to replace labour with capital as the cost of labour rises.
Yes, some businesses will find things difficult in this new environment, but no-one bar a few VC investors ever thought that delivering a can of coke and a packet of crisps to someone’s front door, was ever going to be a profitable business model. Nor washing cars inside and out for a tenner.
Remember what the business model is. Create a new business - "DeliverCo" - which when you sift past all the guff about technology pays the desperate by the hour to cycle through the rain delivering stuff from your corner shop you can no longer be arsed to walk to.
DeliverCo needs to grow market share vs ShiftCo and StuffCo, so offers not just free delivery but a fucking discount on the stuff they are delivering. Shows HUUUUUUGE growth which brings in money from other VC people to grow the business. More market share makes VC investment worth £more - they cash out with a massive profit whilst others pile in. Rinse and repeat.
Frankly they may as well all deliver Tulip Bulbs - its about as sustainable a business model. There is no future in most of these companies. No viable way to make actual money cycling around your £9 beer and crisps order from Tesco Express. Its a get rich quick scheme for investors literally making money off the backs of the people with Deliveroo boxes strapped onto them.
A rare point on which you and I can agree entirely. (AIUI, you come from a food background, and I come from an IT/tech background).
While I can just about understand the business model of Uber, trying to undercut the competition to get a monopoly, at which point they can raise prices as monopolies do, there’s a very high price electricity of demand for deliveries of small grocery orders. No-one is ever going to pay £10 for delivery of beer and crisps, except for those in rural areas where the business model makes no sense anyway, and for the home drinkers on a Saturday night, who can’t face a 10 minute walk or a 5 minute drive to the local shop.
See my earlier post on this thread from a Deliveroo customer's point of view. Briefly I pay £5 for fish and chips to be delivered. This saves me £5 in cab fares, so it is cost neutral to me as a customer. I do not use Deliveroo for groceries but if I did, then it would be offset against the bus fare to and from the shops. Whether there is a sustainable business model underlying this, I do not know.
Yes, you’re paying £5 for Deliveroo to deliver your fish and chips. But their costs of that delivery are £8, and the driver is a contractor earning under minimum wage after his own expenses. If the delivery charge were to be £10 or £12, a level at which they are a sustainable company paying employees, would you still be willing to pay it? More likely you’d walk there and cab back.
Why would a delivery driver cost more than a cab driver? The delivery drivers are expected to do many deliveries per hour, just as a cabbie does.
Plus since Deliveroo are taking not just the £5 from the delivery fees but they're also charging a commission on the sale which you never see in your own bill, they're actually raking in more cash than the cabbie is.
When Just-Eat started they typically offered consumers "free delivery" and just charged the commission to the restaurants. Now they'd doing both, taking two bites of the cherry charging the customers and charging the restaurants too, its certainly plausible that they'll make a profit in the future.
What's less plausible is that they'll ever be a good employer. Or probably even that good for the hospitality industry either as a whole who are getting their profits cannibalised by these companies grabbing a chunk of the revenue.
Bethany Black twitch.tv/beffernieblack @BeffernieBlack · 17m I would like to apologise to the Tory party, I was wrong, after your ability to organise piss ups and get laid in brothels I thought I had the analogy down, but it turns out you *could* organise a buffet in a food bank.
The Bank of England plans to keep interest rates at a record low until unemployment falls to 7% - something unlikely for another three years - in a major new departure for British monetary policy.
Barely a month after Canadian Mark Carney took over from the long-serving Mervyn King as BoE governor, the central bank said on Wednesday that it would keep interest rates at 0.5 percent unless inflation threatened to get out of control or there was a danger to financial stability
Unemployment went below 7% just five months later and it kept on falling. Today it stands at 3.8%.
The issue then was that we imported a lot of deflation from China. Raising interest rates may have ended up causing deflation.
There was also a truly massive deflationary effect from the gradual unwinding of the mountains of "fantasy money" that had been created on the back of CDOs and similar financial products post 2008 which went on for several years. That came close to driving several parts of the world into deflation and the EZ dipped into it more than once.
The British jobs miracle, post 2012, however, remains largely unexplained. Why did it happen here? How did so little of that growth end up being reflected in GDP? Are our GDP figures correct? What policies do we need to sustain high employment? Can we improve productivity within that mix? Are we right about productivity? The reason it is found to be so low is that we effectively divide the number of people in work by the output. As that number went up and the measured output didn't productivity fell, but did it?
These are not just historical issues. They are right at the centre of the economic challenges we face today. I am not sure I believe the official figures.
Surely this one is pretty simple. Different jobs deliver different levels of economic output. The "jobs miracle" delivered an awful lot of low paid low output low security jobs. Whilst I have a lot of respect for the physical effort made by the Uber Eats cyclists delivering people's booze and crisps order its hardly GDP-generating.
What we need to do - as has been the case for the lost decade back to 2012 - is invest in training and skills and manufacturing. Make more stuff, improve balance of payments, increase disposable incomes - the virtuous circle.
The problem is that in the 2008 era we replaced capitalism with bankism. Borrow cheap money, invest it, deliver a return on investment, reinvest the profits is now seen as "who will pay for it" subsidy.
But why did noone else in the EZ produce jobs like we did? That is the mystery. Our employment laws were largely set to European standards. We had a relatively high and increasing minimum wage (Germany didn't even have one for nearly all of that period). And the money spent on takeaways and deliveries was substantial in cumulo and should have boosted GDP by more than it did. My speculation is that we are not very good at measuring that kind of spending, partly because there is significant under declaration of it. We get the employment part because people need to be registered to get in work benefits but the money taken largely disappears from the figures.
Universal credit, and the easy availability of casual work also helped. RochdalePioneers and BartholomewRoberts also raise good points about the need to treat human capital as valuable, and invest in training and development. At the bottom end of the labour market, we now no longer have virtually unlimited supply, so there will be a need to replace labour with capital as the cost of labour rises.
Yes, some businesses will find things difficult in this new environment, but no-one bar a few VC investors ever thought that delivering a can of coke and a packet of crisps to someone’s front door, was ever going to be a profitable business model. Nor washing cars inside and out for a tenner.
Remember what the business model is. Create a new business - "DeliverCo" - which when you sift past all the guff about technology pays the desperate by the hour to cycle through the rain delivering stuff from your corner shop you can no longer be arsed to walk to.
DeliverCo needs to grow market share vs ShiftCo and StuffCo, so offers not just free delivery but a fucking discount on the stuff they are delivering. Shows HUUUUUUGE growth which brings in money from other VC people to grow the business. More market share makes VC investment worth £more - they cash out with a massive profit whilst others pile in. Rinse and repeat.
Frankly they may as well all deliver Tulip Bulbs - its about as sustainable a business model. There is no future in most of these companies. No viable way to make actual money cycling around your £9 beer and crisps order from Tesco Express. Its a get rich quick scheme for investors literally making money off the backs of the people with Deliveroo boxes strapped onto them.
A rare point on which you and I can agree entirely. (AIUI, you come from a food background, and I come from an IT/tech background).
While I can just about understand the business model of Uber, trying to undercut the competition to get a monopoly, at which point they can raise prices as monopolies do, there’s a very high price electricity of demand for deliveries of small grocery orders. No-one is ever going to pay £10 for delivery of beer and crisps, except for those in rural areas where the business model makes no sense anyway, and for the home drinkers on a Saturday night, who can’t face a 10 minute walk or a 5 minute drive to the local shop.
See my earlier post on this thread from a Deliveroo customer's point of view. Briefly I pay £5 for fish and chips to be delivered. This saves me £5 in cab fares, so it is cost neutral to me as a customer. I do not use Deliveroo for groceries but if I did, then it would be offset against the bus fare to and from the shops. Whether there is a sustainable business model underlying this, I do not know.
Yes, you’re paying £5 for Deliveroo to deliver your fish and chips. But their costs of that delivery are £8, and the driver is a contractor earning under minimum wage after his own expenses. If the delivery charge were to be £10 or £12, a level at which they are a sustainable company paying employees, would you still be willing to pay it?
Is it though? Surely it depends how many deliveries each driver makes in an hour. It is not immediately obvious why £5 for Deliveroo to drive my fish and chips is less sustainable than £5 for a minicab to make the same journey. You might well be right, especially as the people at the top are no doubt paying themselves well.
To be fair to Deliveroo they are a pretty efficient operation. Supermarkets lose £4-5 per delivery they make to your door. Deliveroo only lose £1 per delivery. The problem is that whilst Tesco process a gazillion transactions and make a small % from each which adds up to £lots or profit with which to subsidise delivery, for Deliveroo that is their entire business. Hence their need to start opening dark kitchens in some cities to have at least something which is profitable, even if it is not remotely core business.
The Bank of England plans to keep interest rates at a record low until unemployment falls to 7% - something unlikely for another three years - in a major new departure for British monetary policy.
Barely a month after Canadian Mark Carney took over from the long-serving Mervyn King as BoE governor, the central bank said on Wednesday that it would keep interest rates at 0.5 percent unless inflation threatened to get out of control or there was a danger to financial stability
Unemployment went below 7% just five months later and it kept on falling. Today it stands at 3.8%.
The issue then was that we imported a lot of deflation from China. Raising interest rates may have ended up causing deflation.
There was also a truly massive deflationary effect from the gradual unwinding of the mountains of "fantasy money" that had been created on the back of CDOs and similar financial products post 2008 which went on for several years. That came close to driving several parts of the world into deflation and the EZ dipped into it more than once.
The British jobs miracle, post 2012, however, remains largely unexplained. Why did it happen here? How did so little of that growth end up being reflected in GDP? Are our GDP figures correct? What policies do we need to sustain high employment? Can we improve productivity within that mix? Are we right about productivity? The reason it is found to be so low is that we effectively divide the number of people in work by the output. As that number went up and the measured output didn't productivity fell, but did it?
These are not just historical issues. They are right at the centre of the economic challenges we face today. I am not sure I believe the official figures.
Surely this one is pretty simple. Different jobs deliver different levels of economic output. The "jobs miracle" delivered an awful lot of low paid low output low security jobs. Whilst I have a lot of respect for the physical effort made by the Uber Eats cyclists delivering people's booze and crisps order its hardly GDP-generating.
What we need to do - as has been the case for the lost decade back to 2012 - is invest in training and skills and manufacturing. Make more stuff, improve balance of payments, increase disposable incomes - the virtuous circle.
The problem is that in the 2008 era we replaced capitalism with bankism. Borrow cheap money, invest it, deliver a return on investment, reinvest the profits is now seen as "who will pay for it" subsidy.
But why did noone else in the EZ produce jobs like we did? That is the mystery. Our employment laws were largely set to European standards. We had a relatively high and increasing minimum wage (Germany didn't even have one for nearly all of that period). And the money spent on takeaways and deliveries was substantial in cumulo and should have boosted GDP by more than it did. My speculation is that we are not very good at measuring that kind of spending, partly because there is significant under declaration of it. We get the employment part because people need to be registered to get in work benefits but the money taken largely disappears from the figures.
Universal credit, and the easy availability of casual work also helped. @RochdalePioneers and @BartholomewRoberts also raise good points about the need to treat human capital as valuable, and invest in training and development. At the bottom end of the labour market, we now no longer have virtually unlimited supply, so there will be a need to replace labour with capital as the cost of labour rises.
Yes, some businesses will find things difficult in this new environment, but no-one bar a few VC investors ever thought that delivering a can of coke and a packet of crisps to someone’s front door, was ever going to be a profitable business model. Nor washing cars inside and out for a tenner.
Remember what the business model is. Create a new business - "DeliverCo" - which when you sift past all the guff about technology pays the desperate by the hour to cycle through the rain delivering stuff from your corner shop you can no longer be arsed to walk to.
DeliverCo needs to grow market share vs ShiftCo and StuffCo, so offers not just free delivery but a fucking discount on the stuff they are delivering. Shows HUUUUUUGE growth which brings in money from other VC people to grow the business. More market share makes VC investment worth £more - they cash out with a massive profit whilst others pile in. Rinse and repeat.
Frankly they may as well all deliver Tulip Bulbs - its about as sustainable a business model. There is no future in most of these companies. No viable way to make actual money cycling around your £9 beer and crisps order from Tesco Express. Its a get rich quick scheme for investors literally making money off the backs of the people with Deliveroo boxes strapped onto them.
Its certainly possible for companies to make a profit from people making home deliveries of food, Domino's Pizza* is a very profitable business that does precisely that.
The question is getting the balance of costs right. That's never going to be profitable for delivering crisps and a coke, it can be profitable if you're delivering a significant order though.
The question as with many things is about getting the pricing right. It won't happen for "free". There's a reason why Domino's will charge £19 for a pizza with "free delivery", but have a collection "promotion" reducing the price to £9.99 if you collect it.
* Other food delivery companies are available.
We're talking about two different kinds of business. One is the producer - like a Dominos - who offer a delivery service. The other is Deliveroo who collect food from the producer - like Dominos - and deliver it for a fee.
Dominos can afford to subsidise the cost of delivery via the profits made producing the food. Deliveroo et al cannot. They produce nothing, they simply shift product from a to b. Without the ability to make a profit on the produced item there is nothing to subsidise the operation with other than VC cash injections.
But they do take money from the food.
Deliveroo have a very sneaky business model and they actually take money many ways if you read up on it.
They approach restaurants, many of whom are desperate for the cash, and say to them "your kitchen is open anyway, we'll bring orders to you and we'll take a 30% commission". As such the price you're paying for the food, much of it isn't going to the food.
Then they tell customers that the customers need to pay a "service charge". In fact Deliveroo now charges two service charge fees they add on top of the food prices, of which they're taking a commission.
So if you order £40 of food from a restaurant, Deliveroo might take £12 in commission, charge you £4-£5 for delivery/service fees and pay the delivery driver about £3 because they're expected to do 3-4+ deliveries per hour.
Their business model doesn't just rely upon beggaring their delivery drivers, they also do the same for the restaurants too.
Having created a business model for a dark kitchen operation which uses outfits like Deliveroo I do understand their business model! I wonder what direct involvement you have in this industry that I do not have...?
Again, Deliveroo Do Not Make Money From Producing Food.
There is a service charge that gets made against the producing restaurant / take-away / dark kitchen. That is a cost of business, it isn't a cut from their profits, its a reduction in their profits.
If you are Dominos or even your local curry house, you may pay a similar cost of getting deliveries out. But you profit from the food. So it doesn't matter if the delivery operation loses money as long as you are up overall.
What you are missing is that the model for delivery only - like Deliveroo - does not work without regular injections of cash. Even with the revenue stream of taking a % from food producers they lose £1 per delivery (Deliveroo figures) - the more they grow the more £ they lose. The reason why share prices are tanking with all of these businesses is that investors are starting to ask questions about how the business makes money and don't like the answers.
If a restaurant is being charged £12 in commission on a food order then I think whether they are making money from producing food or making money as commission for the food is a distinction without a difference.
Its a reduction in profits for the kitchen. It is Deliveroo taking those profits though.
If Deliveroo take £12 commission and £5 in service charges on a £40 order then pays a driver £3 to deliver that order - do you really think there's no plausible way they can make a profit on that?
Whether the hospitality industry can make money when these companies are taking the profits is a different question.
Mr. Eabhal, given food banks arose during the boom under Blair, and use has increased under the recession, recovery, and since, it does seem that food banks are just on the up regardless of the broader economic picture.
Two words: Universal Credit.
Wasn't it rolled out over a period? Which would also tend to confuse the picture.
And wherever and whenever it was rolled out, food bank use sky-rocketed. Thanks to the bizarre delay in the first payment plus aggressive and arbitrary sanctions regime, primarily, I believe.
I looked into that too. Plenty of anecdotal evidence (which is enough, sometimes) but not coming up in the data.
Loads of confounding factors and as @Carnyx points out, the rollout confuses everything.
Edit: agree that the 5 week wait is a real problem though. Two -child limit is the real killer for child poverty.
The 5 week wait was abolished years ago. They give an up-front payment for people signing up now, which is then taken back in slightly reduced payments over 12 months - even if people then sign off they still get to keep the up-front payment I believe.
No it wasn't and it hasn't. You can apply for it. But no one tells you you can.
It's on the homepage dashboard when you sign in, and IIRC it was flagged up as an option at the end of the initial claim process (it was about 3 years ago, though, so I don't remember all the details).
Mr. Eabhal, given food banks arose during the boom under Blair, and use has increased under the recession, recovery, and since, it does seem that food banks are just on the up regardless of the broader economic picture.
Two words: Universal Credit.
Wasn't it rolled out over a period? Which would also tend to confuse the picture.
And wherever and whenever it was rolled out, food bank use sky-rocketed. Thanks to the bizarre delay in the first payment plus aggressive and arbitrary sanctions regime, primarily, I believe.
I looked into that too. Plenty of anecdotal evidence (which is enough, sometimes) but not coming up in the data.
Loads of confounding factors and as @Carnyx points out, the rollout confuses everything.
Edit: agree that the 5 week wait is a real problem though. Two -child limit is the real killer for child poverty.
The 5 week wait was abolished years ago. They give an up-front payment for people signing up now, which is then taken back in slightly reduced payments over 12 months - even if people then sign off they still get to keep the up-front payment I believe.
No it wasn't and it hasn't. You can apply for it. But no one tells you you can.
There's also no guarantee that you'll get an advance. Nor when.
New: What’s happening in Tory heartlands in the South? We ran a @kekstcnc@timesradio focus group of swing voters in Tiverton & Honiton who voted Conservative in 2019.
None would vote Tory in the upcoming by-election, and all bar one said they will vote for the Lib Dems. (1/12)
These voters – pro-Brexit Conservatives – feel extremely disappointed in the government with their frustrations led by Boris Johnson, lies over partygate, and a feeling that things promised have not been delivered. Here is what they said about the Conservative leader. (2/12) https://twitter.com/jamesjohnson252/status/1524664028601192456/photo/1
Boris Johnson is a direct block to them voting Conservative again.
Most said they would “never” vote for the party until he left. In the words of a long-time Conservative: “When a dog bites you, you never know if it's going to bite you again. You can never trust him". (3/12) https://twitter.com/jamesjohnson252/status/1524664032380215296
James Johnson is yet another presumably well-educated journalist who cannot be bothered to check the spellings of people's names. It's Susanna Reid (no trailing aitch on her given name).
Susanna(h) Reid, Angela Rayne(o)r, Sir Kei(ie)r Starmer and Sue Gra(e)y alone must account for thousands of ignorant and discourteous misspellings every day, not least on PB.
Why can't educated hacks and the Ostentatiously Oxbridge PB Shrewdies do people the basic courtesy of spelling their names correctly?
It really drives me up the effing wall.
And these are bog standard Anglo names. I was at a conference yesterday where an Indian guy was introduced and the woman doing the introduction actually refused to even say his surname because she said it was too hard to pronounce. He laughed it off but I almost walked out, I can't stand this kind of low grade racist bullshit. I checked his surname out afterwards, and it wasn't even that difficult to say. Seriously, getting people's names right is really a basic thing, if people can't manage that perhaps they are in the wrong line of work.
Absolutely. I was taught that hearing their name is the sweetest sound anyone will ever hear. The reverse is of course also true. As you say it's an absolute basic. And your anecdote about the conference is pretty bloody shocking.
On my first day of school, Miss read out the names of the children staying for school dinners rather than going home for lunch. My name was not on it so I toddled off home but no-one was in, so I sat on the doorstep. After a short while the teacher turned up and drove me back to school in her green Mini.
That was my first ever car ride.
With decades of hindsight, my name probably was on the list but mispronounced so badly that I did not recognise it. After a lifetime of having my name misspelled and mispronounced, it is at worst a minor irritant and I am sceptical of claims that this is micro-racism in action. One good point of an unusual name is that there is no _20796 in my email address.
Bolton North East, top Labour target. These were the local election votes in the constituency:
Con 10,485 Lab 9,870 Reform UK 1,465 LD 1,220 Green 441 Ind 92
Used to live there. It's a strange seat. Half strongly Labour. Half strongly Tory. You can literally observe this change as you go uphill out of town on the Halliwell or Blackburn Roads. The ringroad and Astley Bridge ASDA (scene of the "heavy duty black bin bags" song) marks the real boundary. Labour Bolton results were poor.
One of the things that has always amused me about Norwich is you'd never guess in a million years Norwich South was safe Labour, safer currently than Jarrow for example. Lots of students, yes but lots of big, poncey houses in 'the Golden triangle', no particular deprivation issues etc. Nothing that screams Labour. Yet in 30 years of living here (couple of brief stints in Essex and down south aside) I've never seen a single vote Tory poster within the city ring road in Norwich South (it runs roughly a mile out round the city centre), and only ever maybe a couple within the ring road in Norwich North during the Chloe Smith by election win. Norwich Tories are VERY shy Tories Edit - I've even seen a Change UK poster........
Even though the move has been expected for several weeks now, the announcement that the Finnish government is officially seeking to join NATO "without delay" has been greeted with a real sense of relief in Tallinn. The near certain accession of Finland and highly likely accession of Sweden transforms the security postion of Estonia and the other Baltic states drastically for the better. Estonian President Karis was visiting Helsinki yesterday and there was almost a sense of celebration that Estonia´s sister nation has recognised the serious danger that Putin´s Russia now poses to the entire civilised world. Nevertheless this relief is tempered by the knowledge that the crisis is still serious. The US intelligence assessment that the war could last for months or even years to come and the concerns of Western Europe do not match the sense that we have in Estonia, at least based on the Russian losses, as reported. The defeat of Russian forces in Kharkiv that has followed the defeat at the gates of Kyiv, underlines that Western intelligence has consistently over estimated Russian strength and underestimated the Ukrainians. Furthermore, Putin is losing his freedom of action: any attempt to institute conscription may be met with open rebellion, and the repeated arson and bomb attacks in Russia suggests to many here that an anti war resistance movement is growing inside Russia itself. Superior training and tactics, better equipment, higher morale, all favour the Ukrainians, yet the view remains that Putin is solidly entrenched and capable of victory in the war. This is not an assessment that chimes with the Estonians. Unless the Ukrainian losses are many multiples of those reported, the most likely end of the war can only come with a culmination that renders the Russian armed forces combat ineffective, military jargon for complete defeat. While Ukrainian victory is by no means certain, the latest victory on top of a major increase in the number of Ukrainian fresh troops and better kit is inexorably tipping the balance.
Thought this was an excellent turn of phrase by the BBC reporter outside Kharkiv: "War in the Kharkiv region has changed - it's now a game of hawk and mouse, where each side's drones circle constantly, trying to pinpoint the enemy's tanks and guns, for targeting by artillery."
Recently, I have accomplished a mission which made huge impact on Russian losses and completely screwed up their plans to encircle Lysychansk....
I'm too cynical - I want to believe that's a legit account, but I can't help wondering whether it's just Trevor in Milton Keynes who has set up a paypal account and doing quite nicely from posing as a UA soldier. Perfectly fine for soldier to ask for funds - for equipment and for himself - of course, but it does make me wonder.
You’d think that if he was an actual engineering officer for the military, he woudn’t have his own Twitter account with details of military operations.
He’s more likely a freelancer, maybe his job before the war was doing aerial drone surveys for farmers. He’s looking for donations to buy professional, rather than military, drone kit to continue his surveillance. The language isn’t of a native English speaker.
He joined Twitter three years ago. Someone with more time than me, might go back in his timeline to see what he posted last year?
Yep, reasonable analysis. This guy is probably legit, if perhaps not in the army before the preent war. I was just thinking how easy it would be for someone to fake this kind of thing (well enough to fool people with no milatary experience and no geopgraphical knowledge of these areas or knowledge of the detail of the combat - me, for example) and rake off some cash. Sadly, I expect there will be people attempting this.
The Bank of England plans to keep interest rates at a record low until unemployment falls to 7% - something unlikely for another three years - in a major new departure for British monetary policy.
Barely a month after Canadian Mark Carney took over from the long-serving Mervyn King as BoE governor, the central bank said on Wednesday that it would keep interest rates at 0.5 percent unless inflation threatened to get out of control or there was a danger to financial stability
Unemployment went below 7% just five months later and it kept on falling. Today it stands at 3.8%.
The issue then was that we imported a lot of deflation from China. Raising interest rates may have ended up causing deflation.
There was also a truly massive deflationary effect from the gradual unwinding of the mountains of "fantasy money" that had been created on the back of CDOs and similar financial products post 2008 which went on for several years. That came close to driving several parts of the world into deflation and the EZ dipped into it more than once.
The British jobs miracle, post 2012, however, remains largely unexplained. Why did it happen here? How did so little of that growth end up being reflected in GDP? Are our GDP figures correct? What policies do we need to sustain high employment? Can we improve productivity within that mix? Are we right about productivity? The reason it is found to be so low is that we effectively divide the number of people in work by the output. As that number went up and the measured output didn't productivity fell, but did it?
These are not just historical issues. They are right at the centre of the economic challenges we face today. I am not sure I believe the official figures.
Surely this one is pretty simple. Different jobs deliver different levels of economic output. The "jobs miracle" delivered an awful lot of low paid low output low security jobs. Whilst I have a lot of respect for the physical effort made by the Uber Eats cyclists delivering people's booze and crisps order its hardly GDP-generating.
What we need to do - as has been the case for the lost decade back to 2012 - is invest in training and skills and manufacturing. Make more stuff, improve balance of payments, increase disposable incomes - the virtuous circle.
The problem is that in the 2008 era we replaced capitalism with bankism. Borrow cheap money, invest it, deliver a return on investment, reinvest the profits is now seen as "who will pay for it" subsidy.
But why did noone else in the EZ produce jobs like we did? That is the mystery. Our employment laws were largely set to European standards. We had a relatively high and increasing minimum wage (Germany didn't even have one for nearly all of that period). And the money spent on takeaways and deliveries was substantial in cumulo and should have boosted GDP by more than it did. My speculation is that we are not very good at measuring that kind of spending, partly because there is significant under declaration of it. We get the employment part because people need to be registered to get in work benefits but the money taken largely disappears from the figures.
Universal credit, and the easy availability of casual work also helped. RochdalePioneers and BartholomewRoberts also raise good points about the need to treat human capital as valuable, and invest in training and development. At the bottom end of the labour market, we now no longer have virtually unlimited supply, so there will be a need to replace labour with capital as the cost of labour rises.
Yes, some businesses will find things difficult in this new environment, but no-one bar a few VC investors ever thought that delivering a can of coke and a packet of crisps to someone’s front door, was ever going to be a profitable business model. Nor washing cars inside and out for a tenner.
Remember what the business model is. Create a new business - "DeliverCo" - which when you sift past all the guff about technology pays the desperate by the hour to cycle through the rain delivering stuff from your corner shop you can no longer be arsed to walk to.
DeliverCo needs to grow market share vs ShiftCo and StuffCo, so offers not just free delivery but a fucking discount on the stuff they are delivering. Shows HUUUUUUGE growth which brings in money from other VC people to grow the business. More market share makes VC investment worth £more - they cash out with a massive profit whilst others pile in. Rinse and repeat.
Frankly they may as well all deliver Tulip Bulbs - its about as sustainable a business model. There is no future in most of these companies. No viable way to make actual money cycling around your £9 beer and crisps order from Tesco Express. Its a get rich quick scheme for investors literally making money off the backs of the people with Deliveroo boxes strapped onto them.
A rare point on which you and I can agree entirely. (AIUI, you come from a food background, and I come from an IT/tech background).
While I can just about understand the business model of Uber, trying to undercut the competition to get a monopoly, at which point they can raise prices as monopolies do, there’s a very high price electricity of demand for deliveries of small grocery orders. No-one is ever going to pay £10 for delivery of beer and crisps, except for those in rural areas where the business model makes no sense anyway, and for the home drinkers on a Saturday night, who can’t face a 10 minute walk or a 5 minute drive to the local shop.
See my earlier post on this thread from a Deliveroo customer's point of view. Briefly I pay £5 for fish and chips to be delivered. This saves me £5 in cab fares, so it is cost neutral to me as a customer. I do not use Deliveroo for groceries but if I did, then it would be offset against the bus fare to and from the shops. Whether there is a sustainable business model underlying this, I do not know.
Yes, you’re paying £5 for Deliveroo to deliver your fish and chips. But their costs of that delivery are £8, and the driver is a contractor earning under minimum wage after his own expenses. If the delivery charge were to be £10 or £12, a level at which they are a sustainable company paying employees, would you still be willing to pay it? More likely you’d walk there and cab back.
Why would a delivery driver cost more than a cab driver? The delivery drivers are expected to do many deliveries per hour, just as a cabbie does.
Plus since Deliveroo are taking not just the £5 from the delivery fees but they're also charging a commission on the sale which you never see in your own bill, they're actually raking in more cash than the cabbie is.
When Just-Eat started they typically offered consumers "free delivery" and just charged the commission to the restaurants. Now they'd doing both, taking two bites of the cherry charging the customers and charging the restaurants too, its certainly plausible that they'll make a profit in the future.
What's less plausible is that they'll ever be a good employer. Or probably even that good for the hospitality industry either as a whole who are getting their profits cannibalised by these companies grabbing a chunk of the revenue.
Why would the delivery driver have higher cost than a cab driver?
Because of the marketing and IT costs of the delivery company, and the fact that the driver needs to do a return trip.
@DecrepiterJohnL would be way better off, as would his local chippy, if he called the chippy to place an order, then called the local minicab company to pick it up.
The delivery apps can’t ever make a profit, because there’s a limit to what consumers will pay for delivery, and a limit to how much restaurants are willing to get ripped off by the apps. There’s high price elasticity of demand, as an economist might say.
Even worse, there’s the next high-spending, VC-funded app just around the corner, ready to take that market share just as you try and work out how to make delivery profitable.
The ‘dark kitchens’ might turn a profit by themselves, as they’re in cheap industrial areas but can charge rents that only need to be a little lower than the town centre rents the restaurants are used to paying.
Mr. Eabhal, given food banks arose during the boom under Blair, and use has increased under the recession, recovery, and since, it does seem that food banks are just on the up regardless of the broader economic picture.
Two words: Universal Credit.
Wasn't it rolled out over a period? Which would also tend to confuse the picture.
Yep Universal Credit is paid in arrears - which isn't much use if you are suddenly unemployed because your employer has gone bankrupt before paying you.
But its a good thing that its paid in arrears, as wages are paid in arrears, so if you are suddenly employed and have to sign off then you're screwed if you got your benefits up-front.
UC in arrears, but the ability to get money up-front if you need it (which has been the case for years now) is less of a barrier to people signing off than UC up-front is.
Wages often used to be paid in advance. In my last job at a global megacorp, they still were!
Mr. Eabhal, given food banks arose during the boom under Blair, and use has increased under the recession, recovery, and since, it does seem that food banks are just on the up regardless of the broader economic picture.
Two words: Universal Credit.
Wasn't it rolled out over a period? Which would also tend to confuse the picture.
And wherever and whenever it was rolled out, food bank use sky-rocketed. Thanks to the bizarre delay in the first payment plus aggressive and arbitrary sanctions regime, primarily, I believe.
I looked into that too. Plenty of anecdotal evidence (which is enough, sometimes) but not coming up in the data.
Loads of confounding factors and as @Carnyx points out, the rollout confuses everything.
Edit: agree that the 5 week wait is a real problem though. Two -child limit is the real killer for child poverty.
The 5 week wait was abolished years ago. They give an up-front payment for people signing up now, which is then taken back in slightly reduced payments over 12 months - even if people then sign off they still get to keep the up-front payment I believe.
No it wasn't and it hasn't. You can apply for it. But no one tells you you can.
It's on the homepage dashboard when you sign in, and IIRC it was flagged up as an option at the end of the initial claim process (it was about 3 years ago, though, so I don't remember all the details).
Well yes. That's a long way from the 5 week wait having been "abolished years ago".
OGH used to be more objective than he is now. To use the Daily Mirror to back up a case is always desperate and to suggest that Anderson was denigrating poor people is simply untrue. I would suggest that Anderson has actually improved his reputation with his very assured media performances this morning. If there were more like him in the Conservative Parliamentary party I would think the Conservatives would be faring better electorally. To those readers who haven't seen I would suggest that they listen to his whole speech on YouTube.
Mr. Eabhal, given food banks arose during the boom under Blair, and use has increased under the recession, recovery, and since, it does seem that food banks are just on the up regardless of the broader economic picture.
Two words: Universal Credit.
Wasn't it rolled out over a period? Which would also tend to confuse the picture.
And wherever and whenever it was rolled out, food bank use sky-rocketed. Thanks to the bizarre delay in the first payment plus aggressive and arbitrary sanctions regime, primarily, I believe.
I looked into that too. Plenty of anecdotal evidence (which is enough, sometimes) but not coming up in the data.
Loads of confounding factors and as @Carnyx points out, the rollout confuses everything.
Edit: agree that the 5 week wait is a real problem though. Two -child limit is the real killer for child poverty.
The 5 week wait was abolished years ago. They give an up-front payment for people signing up now, which is then taken back in slightly reduced payments over 12 months - even if people then sign off they still get to keep the up-front payment I believe.
No it wasn't and it hasn't. You can apply for it. But no one tells you you can.
There's also no guarantee that you'll get an advance. Nor when.
I got mine 7 days after the UC claim was approved, which itself was 22 days from the start of the claim - I got the impression this was longer than usual due to a couple of unusual things in my circumstances.
This was in 2019 so maybe things have changed since then.
The Bank of England plans to keep interest rates at a record low until unemployment falls to 7% - something unlikely for another three years - in a major new departure for British monetary policy.
Barely a month after Canadian Mark Carney took over from the long-serving Mervyn King as BoE governor, the central bank said on Wednesday that it would keep interest rates at 0.5 percent unless inflation threatened to get out of control or there was a danger to financial stability
Unemployment went below 7% just five months later and it kept on falling. Today it stands at 3.8%.
The issue then was that we imported a lot of deflation from China. Raising interest rates may have ended up causing deflation.
There was also a truly massive deflationary effect from the gradual unwinding of the mountains of "fantasy money" that had been created on the back of CDOs and similar financial products post 2008 which went on for several years. That came close to driving several parts of the world into deflation and the EZ dipped into it more than once.
The British jobs miracle, post 2012, however, remains largely unexplained. Why did it happen here? How did so little of that growth end up being reflected in GDP? Are our GDP figures correct? What policies do we need to sustain high employment? Can we improve productivity within that mix? Are we right about productivity? The reason it is found to be so low is that we effectively divide the number of people in work by the output. As that number went up and the measured output didn't productivity fell, but did it?
These are not just historical issues. They are right at the centre of the economic challenges we face today. I am not sure I believe the official figures.
Surely this one is pretty simple. Different jobs deliver different levels of economic output. The "jobs miracle" delivered an awful lot of low paid low output low security jobs. Whilst I have a lot of respect for the physical effort made by the Uber Eats cyclists delivering people's booze and crisps order its hardly GDP-generating.
What we need to do - as has been the case for the lost decade back to 2012 - is invest in training and skills and manufacturing. Make more stuff, improve balance of payments, increase disposable incomes - the virtuous circle.
The problem is that in the 2008 era we replaced capitalism with bankism. Borrow cheap money, invest it, deliver a return on investment, reinvest the profits is now seen as "who will pay for it" subsidy.
But why did noone else in the EZ produce jobs like we did? That is the mystery. Our employment laws were largely set to European standards. We had a relatively high and increasing minimum wage (Germany didn't even have one for nearly all of that period). And the money spent on takeaways and deliveries was substantial in cumulo and should have boosted GDP by more than it did. My speculation is that we are not very good at measuring that kind of spending, partly because there is significant under declaration of it. We get the employment part because people need to be registered to get in work benefits but the money taken largely disappears from the figures.
Universal credit, and the easy availability of casual work also helped. RochdalePioneers and BartholomewRoberts also raise good points about the need to treat human capital as valuable, and invest in training and development. At the bottom end of the labour market, we now no longer have virtually unlimited supply, so there will be a need to replace labour with capital as the cost of labour rises.
Yes, some businesses will find things difficult in this new environment, but no-one bar a few VC investors ever thought that delivering a can of coke and a packet of crisps to someone’s front door, was ever going to be a profitable business model. Nor washing cars inside and out for a tenner.
Remember what the business model is. Create a new business - "DeliverCo" - which when you sift past all the guff about technology pays the desperate by the hour to cycle through the rain delivering stuff from your corner shop you can no longer be arsed to walk to.
DeliverCo needs to grow market share vs ShiftCo and StuffCo, so offers not just free delivery but a fucking discount on the stuff they are delivering. Shows HUUUUUUGE growth which brings in money from other VC people to grow the business. More market share makes VC investment worth £more - they cash out with a massive profit whilst others pile in. Rinse and repeat.
Frankly they may as well all deliver Tulip Bulbs - its about as sustainable a business model. There is no future in most of these companies. No viable way to make actual money cycling around your £9 beer and crisps order from Tesco Express. Its a get rich quick scheme for investors literally making money off the backs of the people with Deliveroo boxes strapped onto them.
A rare point on which you and I can agree entirely. (AIUI, you come from a food background, and I come from an IT/tech background).
While I can just about understand the business model of Uber, trying to undercut the competition to get a monopoly, at which point they can raise prices as monopolies do, there’s a very high price electricity of demand for deliveries of small grocery orders. No-one is ever going to pay £10 for delivery of beer and crisps, except for those in rural areas where the business model makes no sense anyway, and for the home drinkers on a Saturday night, who can’t face a 10 minute walk or a 5 minute drive to the local shop.
See my earlier post on this thread from a Deliveroo customer's point of view. Briefly I pay £5 for fish and chips to be delivered. This saves me £5 in cab fares, so it is cost neutral to me as a customer. I do not use Deliveroo for groceries but if I did, then it would be offset against the bus fare to and from the shops. Whether there is a sustainable business model underlying this, I do not know.
Yes, you’re paying £5 for Deliveroo to deliver your fish and chips. But their costs of that delivery are £8, and the driver is a contractor earning under minimum wage after his own expenses. If the delivery charge were to be £10 or £12, a level at which they are a sustainable company paying employees, would you still be willing to pay it? More likely you’d walk there and cab back.
Why would a delivery driver cost more than a cab driver? The delivery drivers are expected to do many deliveries per hour, just as a cabbie does.
Plus since Deliveroo are taking not just the £5 from the delivery fees but they're also charging a commission on the sale which you never see in your own bill, they're actually raking in more cash than the cabbie is.
When Just-Eat started they typically offered consumers "free delivery" and just charged the commission to the restaurants. Now they'd doing both, taking two bites of the cherry charging the customers and charging the restaurants too, its certainly plausible that they'll make a profit in the future.
What's less plausible is that they'll ever be a good employer. Or probably even that good for the hospitality industry either as a whole who are getting their profits cannibalised by these companies grabbing a chunk of the revenue.
Why would the delivery driver have higher cost than a cab driver?
Because of the marketing and IT costs of the delivery company, and the fact that the driver needs to do a return trip.
@DecrepiterJohnL would be way better off, as would his local chippy, if he called the chippy to place an order, then called the local minicab company to pick it up.
The delivery apps can’t ever make a profit, because there’s a limit to what consumers will pay for delivery, and a limit to how much restaurants are willing to get ripped off by the apps. There’s high price elasticity of demand, as an economist might say.
Even worse, there’s the next high-spending, VC-funded app just around the corner, ready to take that market share just as you try and work out how to make delivery profitable.
The ‘dark kitchens’ might turn a profit by themselves, as they’re in cheap industrial areas but can charge rents that only need to be a little lower than the town centre rents the restaurants are used to paying.
Cab companies also have marketing and IT costs too and cab drivers need to do round trips too in order to go to the next location too.
I don't agree that there's high price elasticity of demand, people will pay for convenience. If they weren't willing to do so, they'd be cooking themselves, and so people will pay more for getting food delivered. These companies have been very sneaky getting customers hooked not charging for delivery and just charging commission - lately they're whacking up prices they charge customers while still charging commission and they're not losing all their customers over it.
The chippy would be better off taking 100% of the cash instead of Deliveroo taking a slice of it, but there's no reason Deliveroo can't make money when simultaneously both charging commission AND charging delivery fees.
Whether the kitchens turn a profit is another question. A lot of restauranteurs find they do a lot of work without much if any reward.
The Bank of England plans to keep interest rates at a record low until unemployment falls to 7% - something unlikely for another three years - in a major new departure for British monetary policy.
Barely a month after Canadian Mark Carney took over from the long-serving Mervyn King as BoE governor, the central bank said on Wednesday that it would keep interest rates at 0.5 percent unless inflation threatened to get out of control or there was a danger to financial stability
Unemployment went below 7% just five months later and it kept on falling. Today it stands at 3.8%.
The issue then was that we imported a lot of deflation from China. Raising interest rates may have ended up causing deflation.
There was also a truly massive deflationary effect from the gradual unwinding of the mountains of "fantasy money" that had been created on the back of CDOs and similar financial products post 2008 which went on for several years. That came close to driving several parts of the world into deflation and the EZ dipped into it more than once.
The British jobs miracle, post 2012, however, remains largely unexplained. Why did it happen here? How did so little of that growth end up being reflected in GDP? Are our GDP figures correct? What policies do we need to sustain high employment? Can we improve productivity within that mix? Are we right about productivity? The reason it is found to be so low is that we effectively divide the number of people in work by the output. As that number went up and the measured output didn't productivity fell, but did it?
These are not just historical issues. They are right at the centre of the economic challenges we face today. I am not sure I believe the official figures.
Surely this one is pretty simple. Different jobs deliver different levels of economic output. The "jobs miracle" delivered an awful lot of low paid low output low security jobs. Whilst I have a lot of respect for the physical effort made by the Uber Eats cyclists delivering people's booze and crisps order its hardly GDP-generating.
What we need to do - as has been the case for the lost decade back to 2012 - is invest in training and skills and manufacturing. Make more stuff, improve balance of payments, increase disposable incomes - the virtuous circle.
The problem is that in the 2008 era we replaced capitalism with bankism. Borrow cheap money, invest it, deliver a return on investment, reinvest the profits is now seen as "who will pay for it" subsidy.
But why did noone else in the EZ produce jobs like we did? That is the mystery. Our employment laws were largely set to European standards. We had a relatively high and increasing minimum wage (Germany didn't even have one for nearly all of that period). And the money spent on takeaways and deliveries was substantial in cumulo and should have boosted GDP by more than it did. My speculation is that we are not very good at measuring that kind of spending, partly because there is significant under declaration of it. We get the employment part because people need to be registered to get in work benefits but the money taken largely disappears from the figures.
Universal credit, and the easy availability of casual work also helped. @RochdalePioneers and @BartholomewRoberts also raise good points about the need to treat human capital as valuable, and invest in training and development. At the bottom end of the labour market, we now no longer have virtually unlimited supply, so there will be a need to replace labour with capital as the cost of labour rises.
Yes, some businesses will find things difficult in this new environment, but no-one bar a few VC investors ever thought that delivering a can of coke and a packet of crisps to someone’s front door, was ever going to be a profitable business model. Nor washing cars inside and out for a tenner.
Remember what the business model is. Create a new business - "DeliverCo" - which when you sift past all the guff about technology pays the desperate by the hour to cycle through the rain delivering stuff from your corner shop you can no longer be arsed to walk to.
DeliverCo needs to grow market share vs ShiftCo and StuffCo, so offers not just free delivery but a fucking discount on the stuff they are delivering. Shows HUUUUUUGE growth which brings in money from other VC people to grow the business. More market share makes VC investment worth £more - they cash out with a massive profit whilst others pile in. Rinse and repeat.
Frankly they may as well all deliver Tulip Bulbs - its about as sustainable a business model. There is no future in most of these companies. No viable way to make actual money cycling around your £9 beer and crisps order from Tesco Express. Its a get rich quick scheme for investors literally making money off the backs of the people with Deliveroo boxes strapped onto them.
Its certainly possible for companies to make a profit from people making home deliveries of food, Domino's Pizza* is a very profitable business that does precisely that.
The question is getting the balance of costs right. That's never going to be profitable for delivering crisps and a coke, it can be profitable if you're delivering a significant order though.
The question as with many things is about getting the pricing right. It won't happen for "free". There's a reason why Domino's will charge £19 for a pizza with "free delivery", but have a collection "promotion" reducing the price to £9.99 if you collect it.
* Other food delivery companies are available.
We're talking about two different kinds of business. One is the producer - like a Dominos - who offer a delivery service. The other is Deliveroo who collect food from the producer - like Dominos - and deliver it for a fee.
Dominos can afford to subsidise the cost of delivery via the profits made producing the food. Deliveroo et al cannot. They produce nothing, they simply shift product from a to b. Without the ability to make a profit on the produced item there is nothing to subsidise the operation with other than VC cash injections.
But they do take money from the food.
Deliveroo have a very sneaky business model and they actually take money many ways if you read up on it.
They approach restaurants, many of whom are desperate for the cash, and say to them "your kitchen is open anyway, we'll bring orders to you and we'll take a 30% commission". As such the price you're paying for the food, much of it isn't going to the food.
Then they tell customers that the customers need to pay a "service charge". In fact Deliveroo now charges two service charge fees they add on top of the food prices, of which they're taking a commission.
So if you order £40 of food from a restaurant, Deliveroo might take £12 in commission, charge you £4-£5 for delivery/service fees and pay the delivery driver about £3 because they're expected to do 3-4+ deliveries per hour.
Their business model doesn't just rely upon beggaring their delivery drivers, they also do the same for the restaurants too.
Having created a business model for a dark kitchen operation which uses outfits like Deliveroo I do understand their business model! I wonder what direct involvement you have in this industry that I do not have...?
Again, Deliveroo Do Not Make Money From Producing Food.
There is a service charge that gets made against the producing restaurant / take-away / dark kitchen. That is a cost of business, it isn't a cut from their profits, its a reduction in their profits.
If you are Dominos or even your local curry house, you may pay a similar cost of getting deliveries out. But you profit from the food. So it doesn't matter if the delivery operation loses money as long as you are up overall.
What you are missing is that the model for delivery only - like Deliveroo - does not work without regular injections of cash. Even with the revenue stream of taking a % from food producers they lose £1 per delivery (Deliveroo figures) - the more they grow the more £ they lose. The reason why share prices are tanking with all of these businesses is that investors are starting to ask questions about how the business makes money and don't like the answers.
If a restaurant is being charged £12 in commission on a food order then I think whether they are making money from producing food or making money as commission for the food is a distinction without a difference.
Its a reduction in profits for the kitchen. It is Deliveroo taking those profits though.
If Deliveroo take £12 commission and £5 in service charges on a £40 order then pays a driver £3 to deliver that order - do you really think there's no plausible way they can make a profit on that?
Whether the hospitality industry can make money when these companies are taking the profits is a different question.
We have a very different way of structuring a P&L clearly. My commentary is based on actual operating models for dark kitchen operations using real world data from the real world operations. Not sure where yours comes from...
The issue isn't what you or I think about profitability. The issue is what their investors think. They are now asking very direct questions about their ability to ever make money and don't like the non-answers being given.
Here is reality. If DeliverCo was the only operator, and could get the technology side of the business stable so that it becomes an operating cost not a developer cost, and it could charge what it needed, then perhaps it can make money. The only way both the delivery companies and the dark kitchen operators make money is scale.
The problem is that there isn't just DeliverCo. Half a dozen competitors have sprung up, all with their own set-up and marketing costs, all without the scale to turn an operating loss into an operating profit.
The end game is to out grow the competitors who fail and leave the field open to only you. But that isn't happening, and the projected volume growth to infinity isn't there. So huge amounts of cash being burnt and only losses to show.
Mr. Eabhal, given food banks arose during the boom under Blair, and use has increased under the recession, recovery, and since, it does seem that food banks are just on the up regardless of the broader economic picture.
Two words: Universal Credit.
Wasn't it rolled out over a period? Which would also tend to confuse the picture.
And wherever and whenever it was rolled out, food bank use sky-rocketed. Thanks to the bizarre delay in the first payment plus aggressive and arbitrary sanctions regime, primarily, I believe.
I looked into that too. Plenty of anecdotal evidence (which is enough, sometimes) but not coming up in the data.
Loads of confounding factors and as @Carnyx points out, the rollout confuses everything.
Edit: agree that the 5 week wait is a real problem though. Two -child limit is the real killer for child poverty.
The 5 week wait was abolished years ago. They give an up-front payment for people signing up now, which is then taken back in slightly reduced payments over 12 months - even if people then sign off they still get to keep the up-front payment I believe.
No it wasn't and it hasn't. You can apply for it. But no one tells you you can.
There's also no guarantee that you'll get an advance. Nor when.
I got mine 7 days after the UC claim was approved, which itself was 22 days from the start of the claim - I got the impression this was longer than usual due to a couple of unusual things in my circumstances.
This was in 2019 so maybe things have changed since then.
Indeed. But 22 days is also some way from an "upfront payment on signing" as another poster stated. It's often shorter. Sometimes longer if your circumstances are complex. A lot of that often around possession of the required photo ID and access to uploading it. Of course. Those who need it the most tend to be in the most complex and chaotic circumstances. Having said all that. UC is, in the round, a much better system than what it replaced. A single payment, and the ability to leave and receive messages Online with a named contact being two of them.
Mr. Eabhal, given food banks arose during the boom under Blair, and use has increased under the recession, recovery, and since, it does seem that food banks are just on the up regardless of the broader economic picture.
Two words: Universal Credit.
Wasn't it rolled out over a period? Which would also tend to confuse the picture.
And wherever and whenever it was rolled out, food bank use sky-rocketed. Thanks to the bizarre delay in the first payment plus aggressive and arbitrary sanctions regime, primarily, I believe.
I looked into that too. Plenty of anecdotal evidence (which is enough, sometimes) but not coming up in the data.
Loads of confounding factors and as @Carnyx points out, the rollout confuses everything.
Edit: agree that the 5 week wait is a real problem though. Two -child limit is the real killer for child poverty.
The 5 week wait was abolished years ago. They give an up-front payment for people signing up now, which is then taken back in slightly reduced payments over 12 months - even if people then sign off they still get to keep the up-front payment I believe.
No it wasn't and it hasn't. You can apply for it. But no one tells you you can.
There's also no guarantee that you'll get an advance. Nor when.
I got mine 7 days after the UC claim was approved, which itself was 22 days from the start of the claim - I got the impression this was longer than usual due to a couple of unusual things in my circumstances.
This was in 2019 so maybe things have changed since then.
Indeed. But 22 days is also some way from an "upfront payment on signing" as another poster stated. It's often shorter. Sometimes longer if your circumstances are complex. A lot of that often around possession of the required photo ID and access to uploading it. Of course. Those who need it the most tend to be in the most complex and chaotic circumstances. Having said all that. UC is, in the round, a much better system than what it replaced. A single payment, and the ability to leave and receive messages Online with a named contact being two of them.
I'm avoiding moving to it like the plague as I will be worse off. Currently a race between universal credit being forced on me and being able to cushion it with the pensions I built up when I was less f*cked as a human
Just walked out of the fracture clinic. Whenever I want (trial and error) I can throw away my orthopaedic boot and crutches. Yeah!
Great news. Just be careful for the next couple of months as the bones strengthen.
Yep. I hit him with the list of questions:
Driving Ladders Cycling Chopping wood Skiing
All stuff I do a lot of
I have apparently been a naughty boy with some of the stuff I have been doing in the last week, but have got away with it.
I've now got you down as some kind of nordic lumberjack skiing/driving/cycling around the country chopping down trees!
Good news on the fracture, hope it all goes well.
After the Normandy landings, the French Resistance would fell trees across roads to hold up German tank and troop movements, but there is no current war where @kjh could be... oh, hold on.
The Bank of England plans to keep interest rates at a record low until unemployment falls to 7% - something unlikely for another three years - in a major new departure for British monetary policy.
Barely a month after Canadian Mark Carney took over from the long-serving Mervyn King as BoE governor, the central bank said on Wednesday that it would keep interest rates at 0.5 percent unless inflation threatened to get out of control or there was a danger to financial stability
Unemployment went below 7% just five months later and it kept on falling. Today it stands at 3.8%.
The issue then was that we imported a lot of deflation from China. Raising interest rates may have ended up causing deflation.
There was also a truly massive deflationary effect from the gradual unwinding of the mountains of "fantasy money" that had been created on the back of CDOs and similar financial products post 2008 which went on for several years. That came close to driving several parts of the world into deflation and the EZ dipped into it more than once.
The British jobs miracle, post 2012, however, remains largely unexplained. Why did it happen here? How did so little of that growth end up being reflected in GDP? Are our GDP figures correct? What policies do we need to sustain high employment? Can we improve productivity within that mix? Are we right about productivity? The reason it is found to be so low is that we effectively divide the number of people in work by the output. As that number went up and the measured output didn't productivity fell, but did it?
These are not just historical issues. They are right at the centre of the economic challenges we face today. I am not sure I believe the official figures.
Surely this one is pretty simple. Different jobs deliver different levels of economic output. The "jobs miracle" delivered an awful lot of low paid low output low security jobs. Whilst I have a lot of respect for the physical effort made by the Uber Eats cyclists delivering people's booze and crisps order its hardly GDP-generating.
What we need to do - as has been the case for the lost decade back to 2012 - is invest in training and skills and manufacturing. Make more stuff, improve balance of payments, increase disposable incomes - the virtuous circle.
The problem is that in the 2008 era we replaced capitalism with bankism. Borrow cheap money, invest it, deliver a return on investment, reinvest the profits is now seen as "who will pay for it" subsidy.
But why did noone else in the EZ produce jobs like we did? That is the mystery. Our employment laws were largely set to European standards. We had a relatively high and increasing minimum wage (Germany didn't even have one for nearly all of that period). And the money spent on takeaways and deliveries was substantial in cumulo and should have boosted GDP by more than it did. My speculation is that we are not very good at measuring that kind of spending, partly because there is significant under declaration of it. We get the employment part because people need to be registered to get in work benefits but the money taken largely disappears from the figures.
Universal credit, and the easy availability of casual work also helped. @RochdalePioneers and @BartholomewRoberts also raise good points about the need to treat human capital as valuable, and invest in training and development. At the bottom end of the labour market, we now no longer have virtually unlimited supply, so there will be a need to replace labour with capital as the cost of labour rises.
Yes, some businesses will find things difficult in this new environment, but no-one bar a few VC investors ever thought that delivering a can of coke and a packet of crisps to someone’s front door, was ever going to be a profitable business model. Nor washing cars inside and out for a tenner.
Remember what the business model is. Create a new business - "DeliverCo" - which when you sift past all the guff about technology pays the desperate by the hour to cycle through the rain delivering stuff from your corner shop you can no longer be arsed to walk to.
DeliverCo needs to grow market share vs ShiftCo and StuffCo, so offers not just free delivery but a fucking discount on the stuff they are delivering. Shows HUUUUUUGE growth which brings in money from other VC people to grow the business. More market share makes VC investment worth £more - they cash out with a massive profit whilst others pile in. Rinse and repeat.
Frankly they may as well all deliver Tulip Bulbs - its about as sustainable a business model. There is no future in most of these companies. No viable way to make actual money cycling around your £9 beer and crisps order from Tesco Express. Its a get rich quick scheme for investors literally making money off the backs of the people with Deliveroo boxes strapped onto them.
Its certainly possible for companies to make a profit from people making home deliveries of food, Domino's Pizza* is a very profitable business that does precisely that.
The question is getting the balance of costs right. That's never going to be profitable for delivering crisps and a coke, it can be profitable if you're delivering a significant order though.
The question as with many things is about getting the pricing right. It won't happen for "free". There's a reason why Domino's will charge £19 for a pizza with "free delivery", but have a collection "promotion" reducing the price to £9.99 if you collect it.
* Other food delivery companies are available.
We're talking about two different kinds of business. One is the producer - like a Dominos - who offer a delivery service. The other is Deliveroo who collect food from the producer - like Dominos - and deliver it for a fee.
Dominos can afford to subsidise the cost of delivery via the profits made producing the food. Deliveroo et al cannot. They produce nothing, they simply shift product from a to b. Without the ability to make a profit on the produced item there is nothing to subsidise the operation with other than VC cash injections.
But they do take money from the food.
Deliveroo have a very sneaky business model and they actually take money many ways if you read up on it.
They approach restaurants, many of whom are desperate for the cash, and say to them "your kitchen is open anyway, we'll bring orders to you and we'll take a 30% commission". As such the price you're paying for the food, much of it isn't going to the food.
Then they tell customers that the customers need to pay a "service charge". In fact Deliveroo now charges two service charge fees they add on top of the food prices, of which they're taking a commission.
So if you order £40 of food from a restaurant, Deliveroo might take £12 in commission, charge you £4-£5 for delivery/service fees and pay the delivery driver about £3 because they're expected to do 3-4+ deliveries per hour.
Their business model doesn't just rely upon beggaring their delivery drivers, they also do the same for the restaurants too.
Having created a business model for a dark kitchen operation which uses outfits like Deliveroo I do understand their business model! I wonder what direct involvement you have in this industry that I do not have...?
Again, Deliveroo Do Not Make Money From Producing Food.
There is a service charge that gets made against the producing restaurant / take-away / dark kitchen. That is a cost of business, it isn't a cut from their profits, its a reduction in their profits.
If you are Dominos or even your local curry house, you may pay a similar cost of getting deliveries out. But you profit from the food. So it doesn't matter if the delivery operation loses money as long as you are up overall.
What you are missing is that the model for delivery only - like Deliveroo - does not work without regular injections of cash. Even with the revenue stream of taking a % from food producers they lose £1 per delivery (Deliveroo figures) - the more they grow the more £ they lose. The reason why share prices are tanking with all of these businesses is that investors are starting to ask questions about how the business makes money and don't like the answers.
If a restaurant is being charged £12 in commission on a food order then I think whether they are making money from producing food or making money as commission for the food is a distinction without a difference.
Its a reduction in profits for the kitchen. It is Deliveroo taking those profits though.
If Deliveroo take £12 commission and £5 in service charges on a £40 order then pays a driver £3 to deliver that order - do you really think there's no plausible way they can make a profit on that?
Whether the hospitality industry can make money when these companies are taking the profits is a different question.
We have a very different way of structuring a P&L clearly. My commentary is based on actual operating models for dark kitchen operations using real world data from the real world operations. Not sure where yours comes from...
The issue isn't what you or I think about profitability. The issue is what their investors think. They are now asking very direct questions about their ability to ever make money and don't like the non-answers being given.
Here is reality. If DeliverCo was the only operator, and could get the technology side of the business stable so that it becomes an operating cost not a developer cost, and it could charge what it needed, then perhaps it can make money. The only way both the delivery companies and the dark kitchen operators make money is scale.
The problem is that there isn't just DeliverCo. Half a dozen competitors have sprung up, all with their own set-up and marketing costs, all without the scale to turn an operating loss into an operating profit.
The end game is to out grow the competitors who fail and leave the field open to only you. But that isn't happening, and the projected volume growth to infinity isn't there. So huge amounts of cash being burnt and only losses to show.
You keep seeming to look at this from the perspective of the dark kitchen though, rather than from the perspective of Deliveroo. I never claimed the dark kitchen would be profitable, did I?
You claimed that the commission was "a reduction in their profits" which for the dark kitchen is 100% true, but for Deliveroo it isn't, it is their revenue stream. The service charge they then charge the consumer is also a revenue stream for Deliveroo, so they have multiple revenue streams.
Whether their revenue exceeds their costs is a different question, but their service charges are categorically not their only revenue stream.
PS I think anyone setting up a "dark kitchen" its a mug's game. Deliveroo are keen to get people setting them up, because they can then charge money for it but if you're not selling drinks etc to consumers then its going to be very difficult for anyone operating a dark kitchen to turn a profit while paying Deliveroo etc too.
But Deliveroo don't care if the restaurants they 'serve' go bust and are replaced by new investors looking to set up a restaurant. That's another injection of investment cash going on right there, without Deliveroo needing to raise a penny of it, instead they're parasites on that.
The Bank of England plans to keep interest rates at a record low until unemployment falls to 7% - something unlikely for another three years - in a major new departure for British monetary policy.
Barely a month after Canadian Mark Carney took over from the long-serving Mervyn King as BoE governor, the central bank said on Wednesday that it would keep interest rates at 0.5 percent unless inflation threatened to get out of control or there was a danger to financial stability
Unemployment went below 7% just five months later and it kept on falling. Today it stands at 3.8%.
The issue then was that we imported a lot of deflation from China. Raising interest rates may have ended up causing deflation.
There was also a truly massive deflationary effect from the gradual unwinding of the mountains of "fantasy money" that had been created on the back of CDOs and similar financial products post 2008 which went on for several years. That came close to driving several parts of the world into deflation and the EZ dipped into it more than once.
The British jobs miracle, post 2012, however, remains largely unexplained. Why did it happen here? How did so little of that growth end up being reflected in GDP? Are our GDP figures correct? What policies do we need to sustain high employment? Can we improve productivity within that mix? Are we right about productivity? The reason it is found to be so low is that we effectively divide the number of people in work by the output. As that number went up and the measured output didn't productivity fell, but did it?
These are not just historical issues. They are right at the centre of the economic challenges we face today. I am not sure I believe the official figures.
Surely this one is pretty simple. Different jobs deliver different levels of economic output. The "jobs miracle" delivered an awful lot of low paid low output low security jobs. Whilst I have a lot of respect for the physical effort made by the Uber Eats cyclists delivering people's booze and crisps order its hardly GDP-generating.
What we need to do - as has been the case for the lost decade back to 2012 - is invest in training and skills and manufacturing. Make more stuff, improve balance of payments, increase disposable incomes - the virtuous circle.
The problem is that in the 2008 era we replaced capitalism with bankism. Borrow cheap money, invest it, deliver a return on investment, reinvest the profits is now seen as "who will pay for it" subsidy.
But why did noone else in the EZ produce jobs like we did? That is the mystery. Our employment laws were largely set to European standards. We had a relatively high and increasing minimum wage (Germany didn't even have one for nearly all of that period). And the money spent on takeaways and deliveries was substantial in cumulo and should have boosted GDP by more than it did. My speculation is that we are not very good at measuring that kind of spending, partly because there is significant under declaration of it. We get the employment part because people need to be registered to get in work benefits but the money taken largely disappears from the figures.
Universal credit, and the easy availability of casual work also helped. RochdalePioneers and BartholomewRoberts also raise good points about the need to treat human capital as valuable, and invest in training and development. At the bottom end of the labour market, we now no longer have virtually unlimited supply, so there will be a need to replace labour with capital as the cost of labour rises.
Yes, some businesses will find things difficult in this new environment, but no-one bar a few VC investors ever thought that delivering a can of coke and a packet of crisps to someone’s front door, was ever going to be a profitable business model. Nor washing cars inside and out for a tenner.
Remember what the business model is. Create a new business - "DeliverCo" - which when you sift past all the guff about technology pays the desperate by the hour to cycle through the rain delivering stuff from your corner shop you can no longer be arsed to walk to.
DeliverCo needs to grow market share vs ShiftCo and StuffCo, so offers not just free delivery but a fucking discount on the stuff they are delivering. Shows HUUUUUUGE growth which brings in money from other VC people to grow the business. More market share makes VC investment worth £more - they cash out with a massive profit whilst others pile in. Rinse and repeat.
Frankly they may as well all deliver Tulip Bulbs - its about as sustainable a business model. There is no future in most of these companies. No viable way to make actual money cycling around your £9 beer and crisps order from Tesco Express. Its a get rich quick scheme for investors literally making money off the backs of the people with Deliveroo boxes strapped onto them.
A rare point on which you and I can agree entirely. (AIUI, you come from a food background, and I come from an IT/tech background).
While I can just about understand the business model of Uber, trying to undercut the competition to get a monopoly, at which point they can raise prices as monopolies do, there’s a very high price electricity of demand for deliveries of small grocery orders. No-one is ever going to pay £10 for delivery of beer and crisps, except for those in rural areas where the business model makes no sense anyway, and for the home drinkers on a Saturday night, who can’t face a 10 minute walk or a 5 minute drive to the local shop.
See my earlier post on this thread from a Deliveroo customer's point of view. Briefly I pay £5 for fish and chips to be delivered. This saves me £5 in cab fares, so it is cost neutral to me as a customer. I do not use Deliveroo for groceries but if I did, then it would be offset against the bus fare to and from the shops. Whether there is a sustainable business model underlying this, I do not know.
Yes, you’re paying £5 for Deliveroo to deliver your fish and chips. But their costs of that delivery are £8, and the driver is a contractor earning under minimum wage after his own expenses. If the delivery charge were to be £10 or £12, a level at which they are a sustainable company paying employees, would you still be willing to pay it? More likely you’d walk there and cab back.
Why would a delivery driver cost more than a cab driver? The delivery drivers are expected to do many deliveries per hour, just as a cabbie does.
Plus since Deliveroo are taking not just the £5 from the delivery fees but they're also charging a commission on the sale which you never see in your own bill, they're actually raking in more cash than the cabbie is.
When Just-Eat started they typically offered consumers "free delivery" and just charged the commission to the restaurants. Now they'd doing both, taking two bites of the cherry charging the customers and charging the restaurants too, its certainly plausible that they'll make a profit in the future.
What's less plausible is that they'll ever be a good employer. Or probably even that good for the hospitality industry either as a whole who are getting their profits cannibalised by these companies grabbing a chunk of the revenue.
Why would the delivery driver have higher cost than a cab driver?
Because of the marketing and IT costs of the delivery company, and the fact that the driver needs to do a return trip.
@DecrepiterJohnL would be way better off, as would his local chippy, if he called the chippy to place an order, then called the local minicab company to pick it up.
The delivery apps can’t ever make a profit, because there’s a limit to what consumers will pay for delivery, and a limit to how much restaurants are willing to get ripped off by the apps. There’s high price elasticity of demand, as an economist might say.
Even worse, there’s the next high-spending, VC-funded app just around the corner, ready to take that market share just as you try and work out how to make delivery profitable.
The ‘dark kitchens’ might turn a profit by themselves, as they’re in cheap industrial areas but can charge rents that only need to be a little lower than the town centre rents the restaurants are used to paying.
DeliverCo can offer three things to FoodCo: 1 Reach - partner with us and we will bring you custom for which we'll take a commission 2 Tech - we will put your food on our platform and show you analytics as to who buys what so you can optimise your menu 3 Cost - we will be competitively priced for our service
There is a fundamental problem. With the various operators all competing with DeliverCo the only way to operate is use ALL platforms whether they be Gorillas or Ubereats or Deliveroo or whatever. Because you're cross platform you're now using one of the takeaway platform operators like JustEat, so it is THEIR data that matters. And cost will always be too high with competing companies vying for business.
What BR has missed is that most punters and most food producers have no interest which delivery firm is turning up. They don't even manage that side of things. To give you my live example take a dark kitchen facility in that London. 30 separate producers in the facility with 50 dufferent menus on Just East etc.
People go online to Just Eat and choose what they want. Kitchen receives the order, makes the food, hands it over to the facility team who hand over to the DeliverCo person. There isn't even a choice being made about Ubereats vs Deliveroo vs whoever - their business is literally to deliver and only to deliver an order being run by someone else...
The Bank of England plans to keep interest rates at a record low until unemployment falls to 7% - something unlikely for another three years - in a major new departure for British monetary policy.
Barely a month after Canadian Mark Carney took over from the long-serving Mervyn King as BoE governor, the central bank said on Wednesday that it would keep interest rates at 0.5 percent unless inflation threatened to get out of control or there was a danger to financial stability
Unemployment went below 7% just five months later and it kept on falling. Today it stands at 3.8%.
The issue then was that we imported a lot of deflation from China. Raising interest rates may have ended up causing deflation.
There was also a truly massive deflationary effect from the gradual unwinding of the mountains of "fantasy money" that had been created on the back of CDOs and similar financial products post 2008 which went on for several years. That came close to driving several parts of the world into deflation and the EZ dipped into it more than once.
The British jobs miracle, post 2012, however, remains largely unexplained. Why did it happen here? How did so little of that growth end up being reflected in GDP? Are our GDP figures correct? What policies do we need to sustain high employment? Can we improve productivity within that mix? Are we right about productivity? The reason it is found to be so low is that we effectively divide the number of people in work by the output. As that number went up and the measured output didn't productivity fell, but did it?
These are not just historical issues. They are right at the centre of the economic challenges we face today. I am not sure I believe the official figures.
Surely this one is pretty simple. Different jobs deliver different levels of economic output. The "jobs miracle" delivered an awful lot of low paid low output low security jobs. Whilst I have a lot of respect for the physical effort made by the Uber Eats cyclists delivering people's booze and crisps order its hardly GDP-generating.
What we need to do - as has been the case for the lost decade back to 2012 - is invest in training and skills and manufacturing. Make more stuff, improve balance of payments, increase disposable incomes - the virtuous circle.
The problem is that in the 2008 era we replaced capitalism with bankism. Borrow cheap money, invest it, deliver a return on investment, reinvest the profits is now seen as "who will pay for it" subsidy.
But why did noone else in the EZ produce jobs like we did? That is the mystery. Our employment laws were largely set to European standards. We had a relatively high and increasing minimum wage (Germany didn't even have one for nearly all of that period). And the money spent on takeaways and deliveries was substantial in cumulo and should have boosted GDP by more than it did. My speculation is that we are not very good at measuring that kind of spending, partly because there is significant under declaration of it. We get the employment part because people need to be registered to get in work benefits but the money taken largely disappears from the figures.
There is a reason that very large numbers of Europeans come to the UK for jobs. And still do.
In a number of continental countries there are considerably higher protection for *some* parts of the workforce. In effect, there are higher costs for employment. So getting a job is harder.
So many come here, because jobs can be created easily.
The Bank of England plans to keep interest rates at a record low until unemployment falls to 7% - something unlikely for another three years - in a major new departure for British monetary policy.
Barely a month after Canadian Mark Carney took over from the long-serving Mervyn King as BoE governor, the central bank said on Wednesday that it would keep interest rates at 0.5 percent unless inflation threatened to get out of control or there was a danger to financial stability
Unemployment went below 7% just five months later and it kept on falling. Today it stands at 3.8%.
The issue then was that we imported a lot of deflation from China. Raising interest rates may have ended up causing deflation.
There was also a truly massive deflationary effect from the gradual unwinding of the mountains of "fantasy money" that had been created on the back of CDOs and similar financial products post 2008 which went on for several years. That came close to driving several parts of the world into deflation and the EZ dipped into it more than once.
The British jobs miracle, post 2012, however, remains largely unexplained. Why did it happen here? How did so little of that growth end up being reflected in GDP? Are our GDP figures correct? What policies do we need to sustain high employment? Can we improve productivity within that mix? Are we right about productivity? The reason it is found to be so low is that we effectively divide the number of people in work by the output. As that number went up and the measured output didn't productivity fell, but did it?
These are not just historical issues. They are right at the centre of the economic challenges we face today. I am not sure I believe the official figures.
Surely this one is pretty simple. Different jobs deliver different levels of economic output. The "jobs miracle" delivered an awful lot of low paid low output low security jobs. Whilst I have a lot of respect for the physical effort made by the Uber Eats cyclists delivering people's booze and crisps order its hardly GDP-generating.
What we need to do - as has been the case for the lost decade back to 2012 - is invest in training and skills and manufacturing. Make more stuff, improve balance of payments, increase disposable incomes - the virtuous circle.
The problem is that in the 2008 era we replaced capitalism with bankism. Borrow cheap money, invest it, deliver a return on investment, reinvest the profits is now seen as "who will pay for it" subsidy.
But why did noone else in the EZ produce jobs like we did? That is the mystery. Our employment laws were largely set to European standards. We had a relatively high and increasing minimum wage (Germany didn't even have one for nearly all of that period). And the money spent on takeaways and deliveries was substantial in cumulo and should have boosted GDP by more than it did. My speculation is that we are not very good at measuring that kind of spending, partly because there is significant under declaration of it. We get the employment part because people need to be registered to get in work benefits but the money taken largely disappears from the figures.
Universal credit, and the easy availability of casual work also helped. @RochdalePioneers and @BartholomewRoberts also raise good points about the need to treat human capital as valuable, and invest in training and development. At the bottom end of the labour market, we now no longer have virtually unlimited supply, so there will be a need to replace labour with capital as the cost of labour rises.
Yes, some businesses will find things difficult in this new environment, but no-one bar a few VC investors ever thought that delivering a can of coke and a packet of crisps to someone’s front door, was ever going to be a profitable business model. Nor washing cars inside and out for a tenner.
Remember what the business model is. Create a new business - "DeliverCo" - which when you sift past all the guff about technology pays the desperate by the hour to cycle through the rain delivering stuff from your corner shop you can no longer be arsed to walk to.
DeliverCo needs to grow market share vs ShiftCo and StuffCo, so offers not just free delivery but a fucking discount on the stuff they are delivering. Shows HUUUUUUGE growth which brings in money from other VC people to grow the business. More market share makes VC investment worth £more - they cash out with a massive profit whilst others pile in. Rinse and repeat.
Frankly they may as well all deliver Tulip Bulbs - its about as sustainable a business model. There is no future in most of these companies. No viable way to make actual money cycling around your £9 beer and crisps order from Tesco Express. Its a get rich quick scheme for investors literally making money off the backs of the people with Deliveroo boxes strapped onto them.
Its certainly possible for companies to make a profit from people making home deliveries of food, Domino's Pizza* is a very profitable business that does precisely that.
The question is getting the balance of costs right. That's never going to be profitable for delivering crisps and a coke, it can be profitable if you're delivering a significant order though.
The question as with many things is about getting the pricing right. It won't happen for "free". There's a reason why Domino's will charge £19 for a pizza with "free delivery", but have a collection "promotion" reducing the price to £9.99 if you collect it.
* Other food delivery companies are available.
We're talking about two different kinds of business. One is the producer - like a Dominos - who offer a delivery service. The other is Deliveroo who collect food from the producer - like Dominos - and deliver it for a fee.
Dominos can afford to subsidise the cost of delivery via the profits made producing the food. Deliveroo et al cannot. They produce nothing, they simply shift product from a to b. Without the ability to make a profit on the produced item there is nothing to subsidise the operation with other than VC cash injections.
The Bank of England plans to keep interest rates at a record low until unemployment falls to 7% - something unlikely for another three years - in a major new departure for British monetary policy.
Barely a month after Canadian Mark Carney took over from the long-serving Mervyn King as BoE governor, the central bank said on Wednesday that it would keep interest rates at 0.5 percent unless inflation threatened to get out of control or there was a danger to financial stability
Unemployment went below 7% just five months later and it kept on falling. Today it stands at 3.8%.
The issue then was that we imported a lot of deflation from China. Raising interest rates may have ended up causing deflation.
There was also a truly massive deflationary effect from the gradual unwinding of the mountains of "fantasy money" that had been created on the back of CDOs and similar financial products post 2008 which went on for several years. That came close to driving several parts of the world into deflation and the EZ dipped into it more than once.
The British jobs miracle, post 2012, however, remains largely unexplained. Why did it happen here? How did so little of that growth end up being reflected in GDP? Are our GDP figures correct? What policies do we need to sustain high employment? Can we improve productivity within that mix? Are we right about productivity? The reason it is found to be so low is that we effectively divide the number of people in work by the output. As that number went up and the measured output didn't productivity fell, but did it?
These are not just historical issues. They are right at the centre of the economic challenges we face today. I am not sure I believe the official figures.
Surely this one is pretty simple. Different jobs deliver different levels of economic output. The "jobs miracle" delivered an awful lot of low paid low output low security jobs. Whilst I have a lot of respect for the physical effort made by the Uber Eats cyclists delivering people's booze and crisps order its hardly GDP-generating.
What we need to do - as has been the case for the lost decade back to 2012 - is invest in training and skills and manufacturing. Make more stuff, improve balance of payments, increase disposable incomes - the virtuous circle.
The problem is that in the 2008 era we replaced capitalism with bankism. Borrow cheap money, invest it, deliver a return on investment, reinvest the profits is now seen as "who will pay for it" subsidy.
But why did noone else in the EZ produce jobs like we did? That is the mystery. Our employment laws were largely set to European standards. We had a relatively high and increasing minimum wage (Germany didn't even have one for nearly all of that period). And the money spent on takeaways and deliveries was substantial in cumulo and should have boosted GDP by more than it did. My speculation is that we are not very good at measuring that kind of spending, partly because there is significant under declaration of it. We get the employment part because people need to be registered to get in work benefits but the money taken largely disappears from the figures.
Universal credit, and the easy availability of casual work also helped. @RochdalePioneers and @BartholomewRoberts also raise good points about the need to treat human capital as valuable, and invest in training and development. At the bottom end of the labour market, we now no longer have virtually unlimited supply, so there will be a need to replace labour with capital as the cost of labour rises.
Yes, some businesses will find things difficult in this new environment, but no-one bar a few VC investors ever thought that delivering a can of coke and a packet of crisps to someone’s front door, was ever going to be a profitable business model. Nor washing cars inside and out for a tenner.
Remember what the business model is. Create a new business - "DeliverCo" - which when you sift past all the guff about technology pays the desperate by the hour to cycle through the rain delivering stuff from your corner shop you can no longer be arsed to walk to.
DeliverCo needs to grow market share vs ShiftCo and StuffCo, so offers not just free delivery but a fucking discount on the stuff they are delivering. Shows HUUUUUUGE growth which brings in money from other VC people to grow the business. More market share makes VC investment worth £more - they cash out with a massive profit whilst others pile in. Rinse and repeat.
Frankly they may as well all deliver Tulip Bulbs - its about as sustainable a business model. There is no future in most of these companies. No viable way to make actual money cycling around your £9 beer and crisps order from Tesco Express. Its a get rich quick scheme for investors literally making money off the backs of the people with Deliveroo boxes strapped onto them.
Its certainly possible for companies to make a profit from people making home deliveries of food, Domino's Pizza* is a very profitable business that does precisely that.
The question is getting the balance of costs right. That's never going to be profitable for delivering crisps and a coke, it can be profitable if you're delivering a significant order though.
The question as with many things is about getting the pricing right. It won't happen for "free". There's a reason why Domino's will charge £19 for a pizza with "free delivery", but have a collection "promotion" reducing the price to £9.99 if you collect it.
* Other food delivery companies are available.
We're talking about two different kinds of business. One is the producer - like a Dominos - who offer a delivery service. The other is Deliveroo who collect food from the producer - like Dominos - and deliver it for a fee.
Dominos can afford to subsidise the cost of delivery via the profits made producing the food. Deliveroo et al cannot. They produce nothing, they simply shift product from a to b. Without the ability to make a profit on the produced item there is nothing to subsidise the operation with other than VC cash injections.
My daughter used to work in a Chinese takeaway as a student and Deliveroo were taking nearly 40% of the cost of the order as their fee from the shop. The shop was understandably keen to have people order direct but they did not cancel Deliveroo because their website and marketing brought in customers they would otherwise not get.
The Bank of England plans to keep interest rates at a record low until unemployment falls to 7% - something unlikely for another three years - in a major new departure for British monetary policy.
Barely a month after Canadian Mark Carney took over from the long-serving Mervyn King as BoE governor, the central bank said on Wednesday that it would keep interest rates at 0.5 percent unless inflation threatened to get out of control or there was a danger to financial stability
Unemployment went below 7% just five months later and it kept on falling. Today it stands at 3.8%.
The issue then was that we imported a lot of deflation from China. Raising interest rates may have ended up causing deflation.
There was also a truly massive deflationary effect from the gradual unwinding of the mountains of "fantasy money" that had been created on the back of CDOs and similar financial products post 2008 which went on for several years. That came close to driving several parts of the world into deflation and the EZ dipped into it more than once.
The British jobs miracle, post 2012, however, remains largely unexplained. Why did it happen here? How did so little of that growth end up being reflected in GDP? Are our GDP figures correct? What policies do we need to sustain high employment? Can we improve productivity within that mix? Are we right about productivity? The reason it is found to be so low is that we effectively divide the number of people in work by the output. As that number went up and the measured output didn't productivity fell, but did it?
These are not just historical issues. They are right at the centre of the economic challenges we face today. I am not sure I believe the official figures.
Surely this one is pretty simple. Different jobs deliver different levels of economic output. The "jobs miracle" delivered an awful lot of low paid low output low security jobs. Whilst I have a lot of respect for the physical effort made by the Uber Eats cyclists delivering people's booze and crisps order its hardly GDP-generating.
What we need to do - as has been the case for the lost decade back to 2012 - is invest in training and skills and manufacturing. Make more stuff, improve balance of payments, increase disposable incomes - the virtuous circle.
The problem is that in the 2008 era we replaced capitalism with bankism. Borrow cheap money, invest it, deliver a return on investment, reinvest the profits is now seen as "who will pay for it" subsidy.
But why did noone else in the EZ produce jobs like we did? That is the mystery. Our employment laws were largely set to European standards. We had a relatively high and increasing minimum wage (Germany didn't even have one for nearly all of that period). And the money spent on takeaways and deliveries was substantial in cumulo and should have boosted GDP by more than it did. My speculation is that we are not very good at measuring that kind of spending, partly because there is significant under declaration of it. We get the employment part because people need to be registered to get in work benefits but the money taken largely disappears from the figures.
Universal credit, and the easy availability of casual work also helped. RochdalePioneers and BartholomewRoberts also raise good points about the need to treat human capital as valuable, and invest in training and development. At the bottom end of the labour market, we now no longer have virtually unlimited supply, so there will be a need to replace labour with capital as the cost of labour rises.
Yes, some businesses will find things difficult in this new environment, but no-one bar a few VC investors ever thought that delivering a can of coke and a packet of crisps to someone’s front door, was ever going to be a profitable business model. Nor washing cars inside and out for a tenner.
Remember what the business model is. Create a new business - "DeliverCo" - which when you sift past all the guff about technology pays the desperate by the hour to cycle through the rain delivering stuff from your corner shop you can no longer be arsed to walk to.
DeliverCo needs to grow market share vs ShiftCo and StuffCo, so offers not just free delivery but a fucking discount on the stuff they are delivering. Shows HUUUUUUGE growth which brings in money from other VC people to grow the business. More market share makes VC investment worth £more - they cash out with a massive profit whilst others pile in. Rinse and repeat.
Frankly they may as well all deliver Tulip Bulbs - its about as sustainable a business model. There is no future in most of these companies. No viable way to make actual money cycling around your £9 beer and crisps order from Tesco Express. Its a get rich quick scheme for investors literally making money off the backs of the people with Deliveroo boxes strapped onto them.
A rare point on which you and I can agree entirely. (AIUI, you come from a food background, and I come from an IT/tech background).
While I can just about understand the business model of Uber, trying to undercut the competition to get a monopoly, at which point they can raise prices as monopolies do, there’s a very high price electricity of demand for deliveries of small grocery orders. No-one is ever going to pay £10 for delivery of beer and crisps, except for those in rural areas where the business model makes no sense anyway, and for the home drinkers on a Saturday night, who can’t face a 10 minute walk or a 5 minute drive to the local shop.
See my earlier post on this thread from a Deliveroo customer's point of view. Briefly I pay £5 for fish and chips to be delivered. This saves me £5 in cab fares, so it is cost neutral to me as a customer. I do not use Deliveroo for groceries but if I did, then it would be offset against the bus fare to and from the shops. Whether there is a sustainable business model underlying this, I do not know.
Yes, you’re paying £5 for Deliveroo to deliver your fish and chips. But their costs of that delivery are £8, and the driver is a contractor earning under minimum wage after his own expenses. If the delivery charge were to be £10 or £12, a level at which they are a sustainable company paying employees, would you still be willing to pay it? More likely you’d walk there and cab back.
Why would a delivery driver cost more than a cab driver? The delivery drivers are expected to do many deliveries per hour, just as a cabbie does.
Plus since Deliveroo are taking not just the £5 from the delivery fees but they're also charging a commission on the sale which you never see in your own bill, they're actually raking in more cash than the cabbie is.
When Just-Eat started they typically offered consumers "free delivery" and just charged the commission to the restaurants. Now they'd doing both, taking two bites of the cherry charging the customers and charging the restaurants too, its certainly plausible that they'll make a profit in the future.
What's less plausible is that they'll ever be a good employer. Or probably even that good for the hospitality industry either as a whole who are getting their profits cannibalised by these companies grabbing a chunk of the revenue.
Why would the delivery driver have higher cost than a cab driver?
Because of the marketing and IT costs of the delivery company, and the fact that the driver needs to do a return trip.
@DecrepiterJohnL would be way better off, as would his local chippy, if he called the chippy to place an order, then called the local minicab company to pick it up.
The delivery apps can’t ever make a profit, because there’s a limit to what consumers will pay for delivery, and a limit to how much restaurants are willing to get ripped off by the apps. There’s high price elasticity of demand, as an economist might say.
Even worse, there’s the next high-spending, VC-funded app just around the corner, ready to take that market share just as you try and work out how to make delivery profitable.
The ‘dark kitchens’ might turn a profit by themselves, as they’re in cheap industrial areas but can charge rents that only need to be a little lower than the town centre rents the restaurants are used to paying.
DeliverCo can offer three things to FoodCo: 1 Reach - partner with us and we will bring you custom for which we'll take a commission 2 Tech - we will put your food on our platform and show you analytics as to who buys what so you can optimise your menu 3 Cost - we will be competitively priced for our service
There is a fundamental problem. With the various operators all competing with DeliverCo the only way to operate is use ALL platforms whether they be Gorillas or Ubereats or Deliveroo or whatever. Because you're cross platform you're now using one of the takeaway platform operators like JustEat, so it is THEIR data that matters. And cost will always be too high with competing companies vying for business.
What BR has missed is that most punters and most food producers have no interest which delivery firm is turning up. They don't even manage that side of things. To give you my live example take a dark kitchen facility in that London. 30 separate producers in the facility with 50 dufferent menus on Just East etc.
People go online to Just Eat and choose what they want. Kitchen receives the order, makes the food, hands it over to the facility team who hand over to the DeliverCo person. There isn't even a choice being made about Ubereats vs Deliveroo vs whoever - their business is literally to deliver and only to deliver an order being run by someone else...
I don't miss that. That is how DeliverCo works, but it doesn't matter to DeliverCo whether FoodCo makes a profit from the order or not. If FoodCo doesn't make much margin on the order or even goes bust then DeliverCo and DeliverCo's customers will order from a hundred other FoodCo's instead.
DeliverCo can take a slice of what should be FoodCo's profits. That doesn't make FoodCo profitable, but it can make DeliverCo profitable.
Your someone else does the work while DeliverCo takes the margin in commission ...
Btw, there is a reverse causality/vicious cycle where obesity leads to poverty.
Health issues = less work. Social stigma against overweight people, particularly women.
Nonsense.
Image search suggests that is not a photoshop. Wow.
Suggests a man who can’t control his appetites in more ways than one
He can afford a personal trainer and a personal gym, yet he’s dangerously obese. There must be an actuarial risk he won’t make it in total health to 2024
The Bank of England plans to keep interest rates at a record low until unemployment falls to 7% - something unlikely for another three years - in a major new departure for British monetary policy.
Barely a month after Canadian Mark Carney took over from the long-serving Mervyn King as BoE governor, the central bank said on Wednesday that it would keep interest rates at 0.5 percent unless inflation threatened to get out of control or there was a danger to financial stability
Unemployment went below 7% just five months later and it kept on falling. Today it stands at 3.8%.
The issue then was that we imported a lot of deflation from China. Raising interest rates may have ended up causing deflation.
There was also a truly massive deflationary effect from the gradual unwinding of the mountains of "fantasy money" that had been created on the back of CDOs and similar financial products post 2008 which went on for several years. That came close to driving several parts of the world into deflation and the EZ dipped into it more than once.
The British jobs miracle, post 2012, however, remains largely unexplained. Why did it happen here? How did so little of that growth end up being reflected in GDP? Are our GDP figures correct? What policies do we need to sustain high employment? Can we improve productivity within that mix? Are we right about productivity? The reason it is found to be so low is that we effectively divide the number of people in work by the output. As that number went up and the measured output didn't productivity fell, but did it?
These are not just historical issues. They are right at the centre of the economic challenges we face today. I am not sure I believe the official figures.
Surely this one is pretty simple. Different jobs deliver different levels of economic output. The "jobs miracle" delivered an awful lot of low paid low output low security jobs. Whilst I have a lot of respect for the physical effort made by the Uber Eats cyclists delivering people's booze and crisps order its hardly GDP-generating.
What we need to do - as has been the case for the lost decade back to 2012 - is invest in training and skills and manufacturing. Make more stuff, improve balance of payments, increase disposable incomes - the virtuous circle.
The problem is that in the 2008 era we replaced capitalism with bankism. Borrow cheap money, invest it, deliver a return on investment, reinvest the profits is now seen as "who will pay for it" subsidy.
But why did noone else in the EZ produce jobs like we did? That is the mystery. Our employment laws were largely set to European standards. We had a relatively high and increasing minimum wage (Germany didn't even have one for nearly all of that period). And the money spent on takeaways and deliveries was substantial in cumulo and should have boosted GDP by more than it did. My speculation is that we are not very good at measuring that kind of spending, partly because there is significant under declaration of it. We get the employment part because people need to be registered to get in work benefits but the money taken largely disappears from the figures.
Universal credit, and the easy availability of casual work also helped. @RochdalePioneers and @BartholomewRoberts also raise good points about the need to treat human capital as valuable, and invest in training and development. At the bottom end of the labour market, we now no longer have virtually unlimited supply, so there will be a need to replace labour with capital as the cost of labour rises.
Yes, some businesses will find things difficult in this new environment, but no-one bar a few VC investors ever thought that delivering a can of coke and a packet of crisps to someone’s front door, was ever going to be a profitable business model. Nor washing cars inside and out for a tenner.
Remember what the business model is. Create a new business - "DeliverCo" - which when you sift past all the guff about technology pays the desperate by the hour to cycle through the rain delivering stuff from your corner shop you can no longer be arsed to walk to.
DeliverCo needs to grow market share vs ShiftCo and StuffCo, so offers not just free delivery but a fucking discount on the stuff they are delivering. Shows HUUUUUUGE growth which brings in money from other VC people to grow the business. More market share makes VC investment worth £more - they cash out with a massive profit whilst others pile in. Rinse and repeat.
Frankly they may as well all deliver Tulip Bulbs - its about as sustainable a business model. There is no future in most of these companies. No viable way to make actual money cycling around your £9 beer and crisps order from Tesco Express. Its a get rich quick scheme for investors literally making money off the backs of the people with Deliveroo boxes strapped onto them.
Its certainly possible for companies to make a profit from people making home deliveries of food, Domino's Pizza* is a very profitable business that does precisely that.
The question is getting the balance of costs right. That's never going to be profitable for delivering crisps and a coke, it can be profitable if you're delivering a significant order though.
The question as with many things is about getting the pricing right. It won't happen for "free". There's a reason why Domino's will charge £19 for a pizza with "free delivery", but have a collection "promotion" reducing the price to £9.99 if you collect it.
* Other food delivery companies are available.
We're talking about two different kinds of business. One is the producer - like a Dominos - who offer a delivery service. The other is Deliveroo who collect food from the producer - like Dominos - and deliver it for a fee.
Dominos can afford to subsidise the cost of delivery via the profits made producing the food. Deliveroo et al cannot. They produce nothing, they simply shift product from a to b. Without the ability to make a profit on the produced item there is nothing to subsidise the operation with other than VC cash injections.
The Bank of England plans to keep interest rates at a record low until unemployment falls to 7% - something unlikely for another three years - in a major new departure for British monetary policy.
Barely a month after Canadian Mark Carney took over from the long-serving Mervyn King as BoE governor, the central bank said on Wednesday that it would keep interest rates at 0.5 percent unless inflation threatened to get out of control or there was a danger to financial stability
Unemployment went below 7% just five months later and it kept on falling. Today it stands at 3.8%.
The issue then was that we imported a lot of deflation from China. Raising interest rates may have ended up causing deflation.
There was also a truly massive deflationary effect from the gradual unwinding of the mountains of "fantasy money" that had been created on the back of CDOs and similar financial products post 2008 which went on for several years. That came close to driving several parts of the world into deflation and the EZ dipped into it more than once.
The British jobs miracle, post 2012, however, remains largely unexplained. Why did it happen here? How did so little of that growth end up being reflected in GDP? Are our GDP figures correct? What policies do we need to sustain high employment? Can we improve productivity within that mix? Are we right about productivity? The reason it is found to be so low is that we effectively divide the number of people in work by the output. As that number went up and the measured output didn't productivity fell, but did it?
These are not just historical issues. They are right at the centre of the economic challenges we face today. I am not sure I believe the official figures.
Surely this one is pretty simple. Different jobs deliver different levels of economic output. The "jobs miracle" delivered an awful lot of low paid low output low security jobs. Whilst I have a lot of respect for the physical effort made by the Uber Eats cyclists delivering people's booze and crisps order its hardly GDP-generating.
What we need to do - as has been the case for the lost decade back to 2012 - is invest in training and skills and manufacturing. Make more stuff, improve balance of payments, increase disposable incomes - the virtuous circle.
The problem is that in the 2008 era we replaced capitalism with bankism. Borrow cheap money, invest it, deliver a return on investment, reinvest the profits is now seen as "who will pay for it" subsidy.
But why did noone else in the EZ produce jobs like we did? That is the mystery. Our employment laws were largely set to European standards. We had a relatively high and increasing minimum wage (Germany didn't even have one for nearly all of that period). And the money spent on takeaways and deliveries was substantial in cumulo and should have boosted GDP by more than it did. My speculation is that we are not very good at measuring that kind of spending, partly because there is significant under declaration of it. We get the employment part because people need to be registered to get in work benefits but the money taken largely disappears from the figures.
Universal credit, and the easy availability of casual work also helped. @RochdalePioneers and @BartholomewRoberts also raise good points about the need to treat human capital as valuable, and invest in training and development. At the bottom end of the labour market, we now no longer have virtually unlimited supply, so there will be a need to replace labour with capital as the cost of labour rises.
Yes, some businesses will find things difficult in this new environment, but no-one bar a few VC investors ever thought that delivering a can of coke and a packet of crisps to someone’s front door, was ever going to be a profitable business model. Nor washing cars inside and out for a tenner.
Remember what the business model is. Create a new business - "DeliverCo" - which when you sift past all the guff about technology pays the desperate by the hour to cycle through the rain delivering stuff from your corner shop you can no longer be arsed to walk to.
DeliverCo needs to grow market share vs ShiftCo and StuffCo, so offers not just free delivery but a fucking discount on the stuff they are delivering. Shows HUUUUUUGE growth which brings in money from other VC people to grow the business. More market share makes VC investment worth £more - they cash out with a massive profit whilst others pile in. Rinse and repeat.
Frankly they may as well all deliver Tulip Bulbs - its about as sustainable a business model. There is no future in most of these companies. No viable way to make actual money cycling around your £9 beer and crisps order from Tesco Express. Its a get rich quick scheme for investors literally making money off the backs of the people with Deliveroo boxes strapped onto them.
Its certainly possible for companies to make a profit from people making home deliveries of food, Domino's Pizza* is a very profitable business that does precisely that.
The question is getting the balance of costs right. That's never going to be profitable for delivering crisps and a coke, it can be profitable if you're delivering a significant order though.
The question as with many things is about getting the pricing right. It won't happen for "free". There's a reason why Domino's will charge £19 for a pizza with "free delivery", but have a collection "promotion" reducing the price to £9.99 if you collect it.
* Other food delivery companies are available.
We're talking about two different kinds of business. One is the producer - like a Dominos - who offer a delivery service. The other is Deliveroo who collect food from the producer - like Dominos - and deliver it for a fee.
Dominos can afford to subsidise the cost of delivery via the profits made producing the food. Deliveroo et al cannot. They produce nothing, they simply shift product from a to b. Without the ability to make a profit on the produced item there is nothing to subsidise the operation with other than VC cash injections.
My daughter used to work in a Chinese takeaway as a student and Deliveroo were taking nearly 40% of the cost of the order as their fee from the shop. The shop was understandably keen to have people order direct but they did not cancel Deliveroo because their website and marketing brought in customers they would otherwise not get.
Wow that's even worse than the 30% I quoted.
No wonder the shop is keen, but the shop is desperate for cash and so feel they have no alternative to be on Deliveroo's platform.
Why people think Deliveroo has no possibility of being profitable when they parasitically take 40% of the ticket price and a service charge on top is beyond me. Yes they're not doing "the real work" but parasites don't need to.
You keep seeming to look at this from the perspective of the dark kitchen though, rather than from the perspective of Deliveroo. I never claimed the dark kitchen would be profitable, did I?
You claimed that the commission was "a reduction in their profits" which for the dark kitchen is 100% true, but for Deliveroo it isn't, it is their revenue stream. The service charge they then charge the consumer is also a revenue stream for Deliveroo, so they have multiple revenue streams.
Whether their revenue exceeds their costs is a different question, but their service charges are categorically not their only revenue stream.
PS I think anyone setting up a "dark kitchen" its a mug's game. Deliveroo are keen to get people setting them up, because they can then charge money for it but if you're not selling drinks etc to consumers then its going to be very difficult for anyone operating a dark kitchen to turn a profit while paying Deliveroo etc too.
But Deliveroo don't care if the restaurants they 'serve' go bust and are replaced by new investors looking to set up a restaurant. That's another injection of investment cash going on right there, without Deliveroo needing to raise a penny of it, instead they're parasites on that.
You mentioned Dominos originally. Could be a Dominos franchise. Or a chippy. Or Tesco Express - whatever. Those guys make money producing stuff.
Deliveroo are an order processing and delivery company. They make money generating and delivering orders.
The problem is that for the food producer they can't just use Deliveroo. Or Gorillas. Or Ubereats. They need to use all of them. And don't care which. Punters increasingly use umbrella sites like Just Eat rather than Deliveroo as there is more choice.
So the producer makes money producing stuff. The delivery firm makes money via tech and physical; delivery. And that is the problem. They cannot make money unless the tech is established and the volume is enormous. Their commission does not cover their costs and they can't charge more commission because competition lowers the bar - nobody cares who delivers the food.
So yes, Deliveroo do care. They only get volume if the restaurant keeps using them. And there is too much competition. Hence the new idea of Deliveroo operating their own dark kitchen -they can't lose the custom and there is actual profit that can be used to subsidise their losses.
You keep seeming to look at this from the perspective of the dark kitchen though, rather than from the perspective of Deliveroo. I never claimed the dark kitchen would be profitable, did I?
You claimed that the commission was "a reduction in their profits" which for the dark kitchen is 100% true, but for Deliveroo it isn't, it is their revenue stream. The service charge they then charge the consumer is also a revenue stream for Deliveroo, so they have multiple revenue streams.
Whether their revenue exceeds their costs is a different question, but their service charges are categorically not their only revenue stream.
PS I think anyone setting up a "dark kitchen" its a mug's game. Deliveroo are keen to get people setting them up, because they can then charge money for it but if you're not selling drinks etc to consumers then its going to be very difficult for anyone operating a dark kitchen to turn a profit while paying Deliveroo etc too.
But Deliveroo don't care if the restaurants they 'serve' go bust and are replaced by new investors looking to set up a restaurant. That's another injection of investment cash going on right there, without Deliveroo needing to raise a penny of it, instead they're parasites on that.
You mentioned Dominos originally. Could be a Dominos franchise. Or a chippy. Or Tesco Express - whatever. Those guys make money producing stuff.
Deliveroo are an order processing and delivery company. They make money generating and delivering orders.
The problem is that for the food producer they can't just use Deliveroo. Or Gorillas. Or Ubereats. They need to use all of them. And don't care which. Punters increasingly use umbrella sites like Just Eat rather than Deliveroo as there is more choice.
So the producer makes money producing stuff. The delivery firm makes money via tech and physical; delivery. And that is the problem. They cannot make money unless the tech is established and the volume is enormous. Their commission does not cover their costs and they can't charge more commission because competition lowers the bar - nobody cares who delivers the food.
So yes, Deliveroo do care. They only get volume if the restaurant keeps using them. And there is too much competition. Hence the new idea of Deliveroo operating their own dark kitchen -they can't lose the custom and there is actual profit that can be used to subsidise their losses.
You're wrong in saying the producer makes money producing stuff. The producer should make money producing stuff, but the problem is the producer is having a large slice of their ticket price they should be making on being withheld by Deliveroo etc instead.
And all the hundreds of FoodCo's in your local area feel like they have no choice to be on all platforms, even though the platforms withhold the cash they should be making, because the alternative is they get no cash.
Why do you think 40% commission (as per that real world Chinese example) plus 10% service charge can't be profitable?
Mr. Eabhal, given food banks arose during the boom under Blair, and use has increased under the recession, recovery, and since, it does seem that food banks are just on the up regardless of the broader economic picture.
Two words: Universal Credit.
Wasn't it rolled out over a period? Which would also tend to confuse the picture.
And wherever and whenever it was rolled out, food bank use sky-rocketed. Thanks to the bizarre delay in the first payment plus aggressive and arbitrary sanctions regime, primarily, I believe.
I looked into that too. Plenty of anecdotal evidence (which is enough, sometimes) but not coming up in the data.
Loads of confounding factors and as @Carnyx points out, the rollout confuses everything.
Edit: agree that the 5 week wait is a real problem though. Two -child limit is the real killer for child poverty.
The 5 week wait was abolished years ago. They give an up-front payment for people signing up now, which is then taken back in slightly reduced payments over 12 months - even if people then sign off they still get to keep the up-front payment I believe.
No it wasn't and it hasn't. You can apply for it. But no one tells you you can.
There's also no guarantee that you'll get an advance. Nor when.
I got mine 7 days after the UC claim was approved, which itself was 22 days from the start of the claim - I got the impression this was longer than usual due to a couple of unusual things in my circumstances.
This was in 2019 so maybe things have changed since then.
Indeed. But 22 days is also some way from an "upfront payment on signing" as another poster stated. It's often shorter. Sometimes longer if your circumstances are complex. A lot of that often around possession of the required photo ID and access to uploading it. Of course. Those who need it the most tend to be in the most complex and chaotic circumstances. Having said all that. UC is, in the round, a much better system than what it replaced. A single payment, and the ability to leave and receive messages Online with a named contact being two of them.
True, but 22 days (or 29 days) isn't the fair comparison - obviously the advance isn't going to be paid before the claim is approved. If we'd been desperate for the money we could have chopped at least a week of the 22 days, too.
In any case, I was just taking issue with your claim that "nobody tells you about it" - from my own experience that wasn't true, and the overall process wasn't unreasonably slow. Also, once the advance was approved it was paid immediately.
The Bank of England plans to keep interest rates at a record low until unemployment falls to 7% - something unlikely for another three years - in a major new departure for British monetary policy.
Barely a month after Canadian Mark Carney took over from the long-serving Mervyn King as BoE governor, the central bank said on Wednesday that it would keep interest rates at 0.5 percent unless inflation threatened to get out of control or there was a danger to financial stability
Unemployment went below 7% just five months later and it kept on falling. Today it stands at 3.8%.
The issue then was that we imported a lot of deflation from China. Raising interest rates may have ended up causing deflation.
There was also a truly massive deflationary effect from the gradual unwinding of the mountains of "fantasy money" that had been created on the back of CDOs and similar financial products post 2008 which went on for several years. That came close to driving several parts of the world into deflation and the EZ dipped into it more than once.
The British jobs miracle, post 2012, however, remains largely unexplained. Why did it happen here? How did so little of that growth end up being reflected in GDP? Are our GDP figures correct? What policies do we need to sustain high employment? Can we improve productivity within that mix? Are we right about productivity? The reason it is found to be so low is that we effectively divide the number of people in work by the output. As that number went up and the measured output didn't productivity fell, but did it?
These are not just historical issues. They are right at the centre of the economic challenges we face today. I am not sure I believe the official figures.
Surely this one is pretty simple. Different jobs deliver different levels of economic output. The "jobs miracle" delivered an awful lot of low paid low output low security jobs. Whilst I have a lot of respect for the physical effort made by the Uber Eats cyclists delivering people's booze and crisps order its hardly GDP-generating.
What we need to do - as has been the case for the lost decade back to 2012 - is invest in training and skills and manufacturing. Make more stuff, improve balance of payments, increase disposable incomes - the virtuous circle.
The problem is that in the 2008 era we replaced capitalism with bankism. Borrow cheap money, invest it, deliver a return on investment, reinvest the profits is now seen as "who will pay for it" subsidy.
But why did noone else in the EZ produce jobs like we did? That is the mystery. Our employment laws were largely set to European standards. We had a relatively high and increasing minimum wage (Germany didn't even have one for nearly all of that period). And the money spent on takeaways and deliveries was substantial in cumulo and should have boosted GDP by more than it did. My speculation is that we are not very good at measuring that kind of spending, partly because there is significant under declaration of it. We get the employment part because people need to be registered to get in work benefits but the money taken largely disappears from the figures.
Universal credit, and the easy availability of casual work also helped. @RochdalePioneers and @BartholomewRoberts also raise good points about the need to treat human capital as valuable, and invest in training and development. At the bottom end of the labour market, we now no longer have virtually unlimited supply, so there will be a need to replace labour with capital as the cost of labour rises.
Yes, some businesses will find things difficult in this new environment, but no-one bar a few VC investors ever thought that delivering a can of coke and a packet of crisps to someone’s front door, was ever going to be a profitable business model. Nor washing cars inside and out for a tenner.
Remember what the business model is. Create a new business - "DeliverCo" - which when you sift past all the guff about technology pays the desperate by the hour to cycle through the rain delivering stuff from your corner shop you can no longer be arsed to walk to.
DeliverCo needs to grow market share vs ShiftCo and StuffCo, so offers not just free delivery but a fucking discount on the stuff they are delivering. Shows HUUUUUUGE growth which brings in money from other VC people to grow the business. More market share makes VC investment worth £more - they cash out with a massive profit whilst others pile in. Rinse and repeat.
Frankly they may as well all deliver Tulip Bulbs - its about as sustainable a business model. There is no future in most of these companies. No viable way to make actual money cycling around your £9 beer and crisps order from Tesco Express. Its a get rich quick scheme for investors literally making money off the backs of the people with Deliveroo boxes strapped onto them.
Its certainly possible for companies to make a profit from people making home deliveries of food, Domino's Pizza* is a very profitable business that does precisely that.
The question is getting the balance of costs right. That's never going to be profitable for delivering crisps and a coke, it can be profitable if you're delivering a significant order though.
The question as with many things is about getting the pricing right. It won't happen for "free". There's a reason why Domino's will charge £19 for a pizza with "free delivery", but have a collection "promotion" reducing the price to £9.99 if you collect it.
* Other food delivery companies are available.
We're talking about two different kinds of business. One is the producer - like a Dominos - who offer a delivery service. The other is Deliveroo who collect food from the producer - like Dominos - and deliver it for a fee.
Dominos can afford to subsidise the cost of delivery via the profits made producing the food. Deliveroo et al cannot. They produce nothing, they simply shift product from a to b. Without the ability to make a profit on the produced item there is nothing to subsidise the operation with other than VC cash injections.
The Bank of England plans to keep interest rates at a record low until unemployment falls to 7% - something unlikely for another three years - in a major new departure for British monetary policy.
Barely a month after Canadian Mark Carney took over from the long-serving Mervyn King as BoE governor, the central bank said on Wednesday that it would keep interest rates at 0.5 percent unless inflation threatened to get out of control or there was a danger to financial stability
Unemployment went below 7% just five months later and it kept on falling. Today it stands at 3.8%.
The issue then was that we imported a lot of deflation from China. Raising interest rates may have ended up causing deflation.
There was also a truly massive deflationary effect from the gradual unwinding of the mountains of "fantasy money" that had been created on the back of CDOs and similar financial products post 2008 which went on for several years. That came close to driving several parts of the world into deflation and the EZ dipped into it more than once.
The British jobs miracle, post 2012, however, remains largely unexplained. Why did it happen here? How did so little of that growth end up being reflected in GDP? Are our GDP figures correct? What policies do we need to sustain high employment? Can we improve productivity within that mix? Are we right about productivity? The reason it is found to be so low is that we effectively divide the number of people in work by the output. As that number went up and the measured output didn't productivity fell, but did it?
These are not just historical issues. They are right at the centre of the economic challenges we face today. I am not sure I believe the official figures.
Surely this one is pretty simple. Different jobs deliver different levels of economic output. The "jobs miracle" delivered an awful lot of low paid low output low security jobs. Whilst I have a lot of respect for the physical effort made by the Uber Eats cyclists delivering people's booze and crisps order its hardly GDP-generating.
What we need to do - as has been the case for the lost decade back to 2012 - is invest in training and skills and manufacturing. Make more stuff, improve balance of payments, increase disposable incomes - the virtuous circle.
The problem is that in the 2008 era we replaced capitalism with bankism. Borrow cheap money, invest it, deliver a return on investment, reinvest the profits is now seen as "who will pay for it" subsidy.
But why did noone else in the EZ produce jobs like we did? That is the mystery. Our employment laws were largely set to European standards. We had a relatively high and increasing minimum wage (Germany didn't even have one for nearly all of that period). And the money spent on takeaways and deliveries was substantial in cumulo and should have boosted GDP by more than it did. My speculation is that we are not very good at measuring that kind of spending, partly because there is significant under declaration of it. We get the employment part because people need to be registered to get in work benefits but the money taken largely disappears from the figures.
Universal credit, and the easy availability of casual work also helped. @RochdalePioneers and @BartholomewRoberts also raise good points about the need to treat human capital as valuable, and invest in training and development. At the bottom end of the labour market, we now no longer have virtually unlimited supply, so there will be a need to replace labour with capital as the cost of labour rises.
Yes, some businesses will find things difficult in this new environment, but no-one bar a few VC investors ever thought that delivering a can of coke and a packet of crisps to someone’s front door, was ever going to be a profitable business model. Nor washing cars inside and out for a tenner.
Remember what the business model is. Create a new business - "DeliverCo" - which when you sift past all the guff about technology pays the desperate by the hour to cycle through the rain delivering stuff from your corner shop you can no longer be arsed to walk to.
DeliverCo needs to grow market share vs ShiftCo and StuffCo, so offers not just free delivery but a fucking discount on the stuff they are delivering. Shows HUUUUUUGE growth which brings in money from other VC people to grow the business. More market share makes VC investment worth £more - they cash out with a massive profit whilst others pile in. Rinse and repeat.
Frankly they may as well all deliver Tulip Bulbs - its about as sustainable a business model. There is no future in most of these companies. No viable way to make actual money cycling around your £9 beer and crisps order from Tesco Express. Its a get rich quick scheme for investors literally making money off the backs of the people with Deliveroo boxes strapped onto them.
Its certainly possible for companies to make a profit from people making home deliveries of food, Domino's Pizza* is a very profitable business that does precisely that.
The question is getting the balance of costs right. That's never going to be profitable for delivering crisps and a coke, it can be profitable if you're delivering a significant order though.
The question as with many things is about getting the pricing right. It won't happen for "free". There's a reason why Domino's will charge £19 for a pizza with "free delivery", but have a collection "promotion" reducing the price to £9.99 if you collect it.
* Other food delivery companies are available.
We're talking about two different kinds of business. One is the producer - like a Dominos - who offer a delivery service. The other is Deliveroo who collect food from the producer - like Dominos - and deliver it for a fee.
Dominos can afford to subsidise the cost of delivery via the profits made producing the food. Deliveroo et al cannot. They produce nothing, they simply shift product from a to b. Without the ability to make a profit on the produced item there is nothing to subsidise the operation with other than VC cash injections.
My daughter used to work in a Chinese takeaway as a student and Deliveroo were taking nearly 40% of the cost of the order as their fee from the shop. The shop was understandably keen to have people order direct but they did not cancel Deliveroo because their website and marketing brought in customers they would otherwise not get.
Wow that's even worse than the 30% I quoted.
No wonder the shop is keen, but the shop is desperate for cash and so feel they have no alternative to be on Deliveroo's platform.
Why people think Deliveroo has no possibility of being profitable when they parasitically take 40% of the ticket price and a service charge on top is beyond me. Yes they're not doing "the real work" but parasites don't need to.
There is an opportunity here if you can be bothered (probably not for a takeaway). When I see the price on booking websites I know that the hotel is lucky to get 65% of that. If you phone them direct and speak to someone with authority they can make more out of you booking direct and you can get a better price.
Bolton North East, top Labour target. These were the local election votes in the constituency:
Con 10,485 Lab 9,870 Reform UK 1,465 LD 1,220 Green 441 Ind 92
Used to live there. It's a strange seat. Half strongly Labour. Half strongly Tory. You can literally observe this change as you go uphill out of town on the Halliwell or Blackburn Roads. The ringroad and Astley Bridge ASDA (scene of the "heavy duty black bin bags" song) marks the real boundary. Labour Bolton results were poor.
My Father was born there and my grandfather is buried in Dean Churchyard
The Bank of England plans to keep interest rates at a record low until unemployment falls to 7% - something unlikely for another three years - in a major new departure for British monetary policy.
Barely a month after Canadian Mark Carney took over from the long-serving Mervyn King as BoE governor, the central bank said on Wednesday that it would keep interest rates at 0.5 percent unless inflation threatened to get out of control or there was a danger to financial stability
Unemployment went below 7% just five months later and it kept on falling. Today it stands at 3.8%.
The issue then was that we imported a lot of deflation from China. Raising interest rates may have ended up causing deflation.
There was also a truly massive deflationary effect from the gradual unwinding of the mountains of "fantasy money" that had been created on the back of CDOs and similar financial products post 2008 which went on for several years. That came close to driving several parts of the world into deflation and the EZ dipped into it more than once.
The British jobs miracle, post 2012, however, remains largely unexplained. Why did it happen here? How did so little of that growth end up being reflected in GDP? Are our GDP figures correct? What policies do we need to sustain high employment? Can we improve productivity within that mix? Are we right about productivity? The reason it is found to be so low is that we effectively divide the number of people in work by the output. As that number went up and the measured output didn't productivity fell, but did it?
These are not just historical issues. They are right at the centre of the economic challenges we face today. I am not sure I believe the official figures.
Surely this one is pretty simple. Different jobs deliver different levels of economic output. The "jobs miracle" delivered an awful lot of low paid low output low security jobs. Whilst I have a lot of respect for the physical effort made by the Uber Eats cyclists delivering people's booze and crisps order its hardly GDP-generating.
What we need to do - as has been the case for the lost decade back to 2012 - is invest in training and skills and manufacturing. Make more stuff, improve balance of payments, increase disposable incomes - the virtuous circle.
The problem is that in the 2008 era we replaced capitalism with bankism. Borrow cheap money, invest it, deliver a return on investment, reinvest the profits is now seen as "who will pay for it" subsidy.
But why did noone else in the EZ produce jobs like we did? That is the mystery. Our employment laws were largely set to European standards. We had a relatively high and increasing minimum wage (Germany didn't even have one for nearly all of that period). And the money spent on takeaways and deliveries was substantial in cumulo and should have boosted GDP by more than it did. My speculation is that we are not very good at measuring that kind of spending, partly because there is significant under declaration of it. We get the employment part because people need to be registered to get in work benefits but the money taken largely disappears from the figures.
Universal credit, and the easy availability of casual work also helped. @RochdalePioneers and @BartholomewRoberts also raise good points about the need to treat human capital as valuable, and invest in training and development. At the bottom end of the labour market, we now no longer have virtually unlimited supply, so there will be a need to replace labour with capital as the cost of labour rises.
Yes, some businesses will find things difficult in this new environment, but no-one bar a few VC investors ever thought that delivering a can of coke and a packet of crisps to someone’s front door, was ever going to be a profitable business model. Nor washing cars inside and out for a tenner.
Remember what the business model is. Create a new business - "DeliverCo" - which when you sift past all the guff about technology pays the desperate by the hour to cycle through the rain delivering stuff from your corner shop you can no longer be arsed to walk to.
DeliverCo needs to grow market share vs ShiftCo and StuffCo, so offers not just free delivery but a fucking discount on the stuff they are delivering. Shows HUUUUUUGE growth which brings in money from other VC people to grow the business. More market share makes VC investment worth £more - they cash out with a massive profit whilst others pile in. Rinse and repeat.
Frankly they may as well all deliver Tulip Bulbs - its about as sustainable a business model. There is no future in most of these companies. No viable way to make actual money cycling around your £9 beer and crisps order from Tesco Express. Its a get rich quick scheme for investors literally making money off the backs of the people with Deliveroo boxes strapped onto them.
Its certainly possible for companies to make a profit from people making home deliveries of food, Domino's Pizza* is a very profitable business that does precisely that.
The question is getting the balance of costs right. That's never going to be profitable for delivering crisps and a coke, it can be profitable if you're delivering a significant order though.
The question as with many things is about getting the pricing right. It won't happen for "free". There's a reason why Domino's will charge £19 for a pizza with "free delivery", but have a collection "promotion" reducing the price to £9.99 if you collect it.
* Other food delivery companies are available.
We're talking about two different kinds of business. One is the producer - like a Dominos - who offer a delivery service. The other is Deliveroo who collect food from the producer - like Dominos - and deliver it for a fee.
Dominos can afford to subsidise the cost of delivery via the profits made producing the food. Deliveroo et al cannot. They produce nothing, they simply shift product from a to b. Without the ability to make a profit on the produced item there is nothing to subsidise the operation with other than VC cash injections.
The Bank of England plans to keep interest rates at a record low until unemployment falls to 7% - something unlikely for another three years - in a major new departure for British monetary policy.
Barely a month after Canadian Mark Carney took over from the long-serving Mervyn King as BoE governor, the central bank said on Wednesday that it would keep interest rates at 0.5 percent unless inflation threatened to get out of control or there was a danger to financial stability
Unemployment went below 7% just five months later and it kept on falling. Today it stands at 3.8%.
The issue then was that we imported a lot of deflation from China. Raising interest rates may have ended up causing deflation.
There was also a truly massive deflationary effect from the gradual unwinding of the mountains of "fantasy money" that had been created on the back of CDOs and similar financial products post 2008 which went on for several years. That came close to driving several parts of the world into deflation and the EZ dipped into it more than once.
The British jobs miracle, post 2012, however, remains largely unexplained. Why did it happen here? How did so little of that growth end up being reflected in GDP? Are our GDP figures correct? What policies do we need to sustain high employment? Can we improve productivity within that mix? Are we right about productivity? The reason it is found to be so low is that we effectively divide the number of people in work by the output. As that number went up and the measured output didn't productivity fell, but did it?
These are not just historical issues. They are right at the centre of the economic challenges we face today. I am not sure I believe the official figures.
Surely this one is pretty simple. Different jobs deliver different levels of economic output. The "jobs miracle" delivered an awful lot of low paid low output low security jobs. Whilst I have a lot of respect for the physical effort made by the Uber Eats cyclists delivering people's booze and crisps order its hardly GDP-generating.
What we need to do - as has been the case for the lost decade back to 2012 - is invest in training and skills and manufacturing. Make more stuff, improve balance of payments, increase disposable incomes - the virtuous circle.
The problem is that in the 2008 era we replaced capitalism with bankism. Borrow cheap money, invest it, deliver a return on investment, reinvest the profits is now seen as "who will pay for it" subsidy.
But why did noone else in the EZ produce jobs like we did? That is the mystery. Our employment laws were largely set to European standards. We had a relatively high and increasing minimum wage (Germany didn't even have one for nearly all of that period). And the money spent on takeaways and deliveries was substantial in cumulo and should have boosted GDP by more than it did. My speculation is that we are not very good at measuring that kind of spending, partly because there is significant under declaration of it. We get the employment part because people need to be registered to get in work benefits but the money taken largely disappears from the figures.
Universal credit, and the easy availability of casual work also helped. @RochdalePioneers and @BartholomewRoberts also raise good points about the need to treat human capital as valuable, and invest in training and development. At the bottom end of the labour market, we now no longer have virtually unlimited supply, so there will be a need to replace labour with capital as the cost of labour rises.
Yes, some businesses will find things difficult in this new environment, but no-one bar a few VC investors ever thought that delivering a can of coke and a packet of crisps to someone’s front door, was ever going to be a profitable business model. Nor washing cars inside and out for a tenner.
Remember what the business model is. Create a new business - "DeliverCo" - which when you sift past all the guff about technology pays the desperate by the hour to cycle through the rain delivering stuff from your corner shop you can no longer be arsed to walk to.
DeliverCo needs to grow market share vs ShiftCo and StuffCo, so offers not just free delivery but a fucking discount on the stuff they are delivering. Shows HUUUUUUGE growth which brings in money from other VC people to grow the business. More market share makes VC investment worth £more - they cash out with a massive profit whilst others pile in. Rinse and repeat.
Frankly they may as well all deliver Tulip Bulbs - its about as sustainable a business model. There is no future in most of these companies. No viable way to make actual money cycling around your £9 beer and crisps order from Tesco Express. Its a get rich quick scheme for investors literally making money off the backs of the people with Deliveroo boxes strapped onto them.
Its certainly possible for companies to make a profit from people making home deliveries of food, Domino's Pizza* is a very profitable business that does precisely that.
The question is getting the balance of costs right. That's never going to be profitable for delivering crisps and a coke, it can be profitable if you're delivering a significant order though.
The question as with many things is about getting the pricing right. It won't happen for "free". There's a reason why Domino's will charge £19 for a pizza with "free delivery", but have a collection "promotion" reducing the price to £9.99 if you collect it.
* Other food delivery companies are available.
We're talking about two different kinds of business. One is the producer - like a Dominos - who offer a delivery service. The other is Deliveroo who collect food from the producer - like Dominos - and deliver it for a fee.
Dominos can afford to subsidise the cost of delivery via the profits made producing the food. Deliveroo et al cannot. They produce nothing, they simply shift product from a to b. Without the ability to make a profit on the produced item there is nothing to subsidise the operation with other than VC cash injections.
My daughter used to work in a Chinese takeaway as a student and Deliveroo were taking nearly 40% of the cost of the order as their fee from the shop. The shop was understandably keen to have people order direct but they did not cancel Deliveroo because their website and marketing brought in customers they would otherwise not get.
Wow that's even worse than the 30% I quoted.
No wonder the shop is keen, but the shop is desperate for cash and so feel they have no alternative to be on Deliveroo's platform.
Why people think Deliveroo has no possibility of being profitable when they parasitically take 40% of the ticket price and a service charge on top is beyond me. Yes they're not doing "the real work" but parasites don't need to.
30% of the cost of the food is the standard commission, but including the service charges Deliveroo will get close to 40% of what the customer actually pays. Plus Deliveroo has a rule that you can't charge more for food ordered through them than the customer pays if they walk in.
The Bank of England plans to keep interest rates at a record low until unemployment falls to 7% - something unlikely for another three years - in a major new departure for British monetary policy.
Barely a month after Canadian Mark Carney took over from the long-serving Mervyn King as BoE governor, the central bank said on Wednesday that it would keep interest rates at 0.5 percent unless inflation threatened to get out of control or there was a danger to financial stability
Unemployment went below 7% just five months later and it kept on falling. Today it stands at 3.8%.
The issue then was that we imported a lot of deflation from China. Raising interest rates may have ended up causing deflation.
There was also a truly massive deflationary effect from the gradual unwinding of the mountains of "fantasy money" that had been created on the back of CDOs and similar financial products post 2008 which went on for several years. That came close to driving several parts of the world into deflation and the EZ dipped into it more than once.
The British jobs miracle, post 2012, however, remains largely unexplained. Why did it happen here? How did so little of that growth end up being reflected in GDP? Are our GDP figures correct? What policies do we need to sustain high employment? Can we improve productivity within that mix? Are we right about productivity? The reason it is found to be so low is that we effectively divide the number of people in work by the output. As that number went up and the measured output didn't productivity fell, but did it?
These are not just historical issues. They are right at the centre of the economic challenges we face today. I am not sure I believe the official figures.
Surely this one is pretty simple. Different jobs deliver different levels of economic output. The "jobs miracle" delivered an awful lot of low paid low output low security jobs. Whilst I have a lot of respect for the physical effort made by the Uber Eats cyclists delivering people's booze and crisps order its hardly GDP-generating.
What we need to do - as has been the case for the lost decade back to 2012 - is invest in training and skills and manufacturing. Make more stuff, improve balance of payments, increase disposable incomes - the virtuous circle.
The problem is that in the 2008 era we replaced capitalism with bankism. Borrow cheap money, invest it, deliver a return on investment, reinvest the profits is now seen as "who will pay for it" subsidy.
But why did noone else in the EZ produce jobs like we did? That is the mystery. Our employment laws were largely set to European standards. We had a relatively high and increasing minimum wage (Germany didn't even have one for nearly all of that period). And the money spent on takeaways and deliveries was substantial in cumulo and should have boosted GDP by more than it did. My speculation is that we are not very good at measuring that kind of spending, partly because there is significant under declaration of it. We get the employment part because people need to be registered to get in work benefits but the money taken largely disappears from the figures.
Universal credit, and the easy availability of casual work also helped. @RochdalePioneers and @BartholomewRoberts also raise good points about the need to treat human capital as valuable, and invest in training and development. At the bottom end of the labour market, we now no longer have virtually unlimited supply, so there will be a need to replace labour with capital as the cost of labour rises.
Yes, some businesses will find things difficult in this new environment, but no-one bar a few VC investors ever thought that delivering a can of coke and a packet of crisps to someone’s front door, was ever going to be a profitable business model. Nor washing cars inside and out for a tenner.
Remember what the business model is. Create a new business - "DeliverCo" - which when you sift past all the guff about technology pays the desperate by the hour to cycle through the rain delivering stuff from your corner shop you can no longer be arsed to walk to.
DeliverCo needs to grow market share vs ShiftCo and StuffCo, so offers not just free delivery but a fucking discount on the stuff they are delivering. Shows HUUUUUUGE growth which brings in money from other VC people to grow the business. More market share makes VC investment worth £more - they cash out with a massive profit whilst others pile in. Rinse and repeat.
Frankly they may as well all deliver Tulip Bulbs - its about as sustainable a business model. There is no future in most of these companies. No viable way to make actual money cycling around your £9 beer and crisps order from Tesco Express. Its a get rich quick scheme for investors literally making money off the backs of the people with Deliveroo boxes strapped onto them.
Its certainly possible for companies to make a profit from people making home deliveries of food, Domino's Pizza* is a very profitable business that does precisely that.
The question is getting the balance of costs right. That's never going to be profitable for delivering crisps and a coke, it can be profitable if you're delivering a significant order though.
The question as with many things is about getting the pricing right. It won't happen for "free". There's a reason why Domino's will charge £19 for a pizza with "free delivery", but have a collection "promotion" reducing the price to £9.99 if you collect it.
* Other food delivery companies are available.
We're talking about two different kinds of business. One is the producer - like a Dominos - who offer a delivery service. The other is Deliveroo who collect food from the producer - like Dominos - and deliver it for a fee.
Dominos can afford to subsidise the cost of delivery via the profits made producing the food. Deliveroo et al cannot. They produce nothing, they simply shift product from a to b. Without the ability to make a profit on the produced item there is nothing to subsidise the operation with other than VC cash injections.
The Bank of England plans to keep interest rates at a record low until unemployment falls to 7% - something unlikely for another three years - in a major new departure for British monetary policy.
Barely a month after Canadian Mark Carney took over from the long-serving Mervyn King as BoE governor, the central bank said on Wednesday that it would keep interest rates at 0.5 percent unless inflation threatened to get out of control or there was a danger to financial stability
Unemployment went below 7% just five months later and it kept on falling. Today it stands at 3.8%.
The issue then was that we imported a lot of deflation from China. Raising interest rates may have ended up causing deflation.
There was also a truly massive deflationary effect from the gradual unwinding of the mountains of "fantasy money" that had been created on the back of CDOs and similar financial products post 2008 which went on for several years. That came close to driving several parts of the world into deflation and the EZ dipped into it more than once.
The British jobs miracle, post 2012, however, remains largely unexplained. Why did it happen here? How did so little of that growth end up being reflected in GDP? Are our GDP figures correct? What policies do we need to sustain high employment? Can we improve productivity within that mix? Are we right about productivity? The reason it is found to be so low is that we effectively divide the number of people in work by the output. As that number went up and the measured output didn't productivity fell, but did it?
These are not just historical issues. They are right at the centre of the economic challenges we face today. I am not sure I believe the official figures.
Surely this one is pretty simple. Different jobs deliver different levels of economic output. The "jobs miracle" delivered an awful lot of low paid low output low security jobs. Whilst I have a lot of respect for the physical effort made by the Uber Eats cyclists delivering people's booze and crisps order its hardly GDP-generating.
What we need to do - as has been the case for the lost decade back to 2012 - is invest in training and skills and manufacturing. Make more stuff, improve balance of payments, increase disposable incomes - the virtuous circle.
The problem is that in the 2008 era we replaced capitalism with bankism. Borrow cheap money, invest it, deliver a return on investment, reinvest the profits is now seen as "who will pay for it" subsidy.
But why did noone else in the EZ produce jobs like we did? That is the mystery. Our employment laws were largely set to European standards. We had a relatively high and increasing minimum wage (Germany didn't even have one for nearly all of that period). And the money spent on takeaways and deliveries was substantial in cumulo and should have boosted GDP by more than it did. My speculation is that we are not very good at measuring that kind of spending, partly because there is significant under declaration of it. We get the employment part because people need to be registered to get in work benefits but the money taken largely disappears from the figures.
Universal credit, and the easy availability of casual work also helped. @RochdalePioneers and @BartholomewRoberts also raise good points about the need to treat human capital as valuable, and invest in training and development. At the bottom end of the labour market, we now no longer have virtually unlimited supply, so there will be a need to replace labour with capital as the cost of labour rises.
Yes, some businesses will find things difficult in this new environment, but no-one bar a few VC investors ever thought that delivering a can of coke and a packet of crisps to someone’s front door, was ever going to be a profitable business model. Nor washing cars inside and out for a tenner.
Remember what the business model is. Create a new business - "DeliverCo" - which when you sift past all the guff about technology pays the desperate by the hour to cycle through the rain delivering stuff from your corner shop you can no longer be arsed to walk to.
DeliverCo needs to grow market share vs ShiftCo and StuffCo, so offers not just free delivery but a fucking discount on the stuff they are delivering. Shows HUUUUUUGE growth which brings in money from other VC people to grow the business. More market share makes VC investment worth £more - they cash out with a massive profit whilst others pile in. Rinse and repeat.
Frankly they may as well all deliver Tulip Bulbs - its about as sustainable a business model. There is no future in most of these companies. No viable way to make actual money cycling around your £9 beer and crisps order from Tesco Express. Its a get rich quick scheme for investors literally making money off the backs of the people with Deliveroo boxes strapped onto them.
Its certainly possible for companies to make a profit from people making home deliveries of food, Domino's Pizza* is a very profitable business that does precisely that.
The question is getting the balance of costs right. That's never going to be profitable for delivering crisps and a coke, it can be profitable if you're delivering a significant order though.
The question as with many things is about getting the pricing right. It won't happen for "free". There's a reason why Domino's will charge £19 for a pizza with "free delivery", but have a collection "promotion" reducing the price to £9.99 if you collect it.
* Other food delivery companies are available.
We're talking about two different kinds of business. One is the producer - like a Dominos - who offer a delivery service. The other is Deliveroo who collect food from the producer - like Dominos - and deliver it for a fee.
Dominos can afford to subsidise the cost of delivery via the profits made producing the food. Deliveroo et al cannot. They produce nothing, they simply shift product from a to b. Without the ability to make a profit on the produced item there is nothing to subsidise the operation with other than VC cash injections.
My daughter used to work in a Chinese takeaway as a student and Deliveroo were taking nearly 40% of the cost of the order as their fee from the shop. The shop was understandably keen to have people order direct but they did not cancel Deliveroo because their website and marketing brought in customers they would otherwise not get.
Wow that's even worse than the 30% I quoted.
No wonder the shop is keen, but the shop is desperate for cash and so feel they have no alternative to be on Deliveroo's platform.
Why people think Deliveroo has no possibility of being profitable when they parasitically take 40% of the ticket price and a service charge on top is beyond me. Yes they're not doing "the real work" but parasites don't need to.
There is an opportunity here if you can be bothered (probably not for a takeaway). When I see the price on booking websites I know that the hotel is lucky to get 65% of that. If you phone them direct and speak to someone with authority they can make more out of you booking direct and you can get a better price.
Precisely! This is the point, the business doing the real work struggles to get much cash out of it because the parasites are taking a lot, but that doesn't mean the parasites can't be profitable ultimately themselves.
They're taking the cash while not doing the work, that can be a profitable business model, if you can get customers sticking with you and make the people who do the real work feel they have no alternative but to use you - its parasitical but it can work.
The Bozzatron looking slightly less fat the same day.. Perhaps because he did actually cycle for eight hours.
Cycling for 8 hours in a day at his age with the pressure he is under for his time and the way, in my experience, exercise is one of the things that gets squeezed, is a pretty serious effort in my book. I for one don't see this as something to mock.
You keep seeming to look at this from the perspective of the dark kitchen though, rather than from the perspective of Deliveroo. I never claimed the dark kitchen would be profitable, did I?
You claimed that the commission was "a reduction in their profits" which for the dark kitchen is 100% true, but for Deliveroo it isn't, it is their revenue stream. The service charge they then charge the consumer is also a revenue stream for Deliveroo, so they have multiple revenue streams.
Whether their revenue exceeds their costs is a different question, but their service charges are categorically not their only revenue stream.
PS I think anyone setting up a "dark kitchen" its a mug's game. Deliveroo are keen to get people setting them up, because they can then charge money for it but if you're not selling drinks etc to consumers then its going to be very difficult for anyone operating a dark kitchen to turn a profit while paying Deliveroo etc too.
But Deliveroo don't care if the restaurants they 'serve' go bust and are replaced by new investors looking to set up a restaurant. That's another injection of investment cash going on right there, without Deliveroo needing to raise a penny of it, instead they're parasites on that.
You mentioned Dominos originally. Could be a Dominos franchise. Or a chippy. Or Tesco Express - whatever. Those guys make money producing stuff.
Deliveroo are an order processing and delivery company. They make money generating and delivering orders.
The problem is that for the food producer they can't just use Deliveroo. Or Gorillas. Or Ubereats. They need to use all of them. And don't care which. Punters increasingly use umbrella sites like Just Eat rather than Deliveroo as there is more choice.
So the producer makes money producing stuff. The delivery firm makes money via tech and physical; delivery. And that is the problem. They cannot make money unless the tech is established and the volume is enormous. Their commission does not cover their costs and they can't charge more commission because competition lowers the bar - nobody cares who delivers the food.
So yes, Deliveroo do care. They only get volume if the restaurant keeps using them. And there is too much competition. Hence the new idea of Deliveroo operating their own dark kitchen -they can't lose the custom and there is actual profit that can be used to subsidise their losses.
You're wrong in saying the producer makes money producing stuff. The producer should make money producing stuff, but the problem is the producer is having a large slice of their ticket price they should be making on being withheld by Deliveroo etc instead.
And all the hundreds of FoodCo's in your local area feel like they have no choice to be on all platforms, even though the platforms withhold the cash they should be making, because the alternative is they get no cash.
Why do you think 40% commission (as per that real world Chinese example) plus 10% service charge can't be profitable?
Why? Because those figures are wrong. Their total charge is more like 30% including the service charge depending on the area. If someone is being ripped at 50% then they quit and use one of the competitors.
I'm going to park this because you aren't paying any attention. It isn't what I think. It is what their investors know. The investors who see the real figures not your best guess figures.
Please, go buy shares in Deliveroo as you are so convinced they are a winner. They are a bargain at the moment having lost 60% of their value since the start of the year.
The Bozzatron looking slightly less fat the same day.. Perhaps because he did actually cycle for eight hours.
Cycling for 8 hours in a day at his age with the pressure he is under for his time and the way, in my experience, exercise is one of the things that gets squeezed, is a pretty serious effort in my book. I for one don't see this as something to mock.
The Bozzatron looking slightly less fat the same day.. Perhaps because he did actually cycle for eight hours.
Cycling for 8 hours in a day at his age with the pressure he is under for his time and the way, in my experience, exercise is one of the things that gets squeezed, is a pretty serious effort in my book. I for one don't see this as something to mock.
The media bubble tosspots have got this one wrong. They are probably helping him.
Making those comments in the Queens speech debate during a cost of living crisis re not been able to budget and not being able to cook is an epic fail . The video isn’t going to repair that damage , most think he’s an out of touch twat who happily raked in the expenses.
You keep seeming to look at this from the perspective of the dark kitchen though, rather than from the perspective of Deliveroo. I never claimed the dark kitchen would be profitable, did I?
You claimed that the commission was "a reduction in their profits" which for the dark kitchen is 100% true, but for Deliveroo it isn't, it is their revenue stream. The service charge they then charge the consumer is also a revenue stream for Deliveroo, so they have multiple revenue streams.
Whether their revenue exceeds their costs is a different question, but their service charges are categorically not their only revenue stream.
PS I think anyone setting up a "dark kitchen" its a mug's game. Deliveroo are keen to get people setting them up, because they can then charge money for it but if you're not selling drinks etc to consumers then its going to be very difficult for anyone operating a dark kitchen to turn a profit while paying Deliveroo etc too.
But Deliveroo don't care if the restaurants they 'serve' go bust and are replaced by new investors looking to set up a restaurant. That's another injection of investment cash going on right there, without Deliveroo needing to raise a penny of it, instead they're parasites on that.
You mentioned Dominos originally. Could be a Dominos franchise. Or a chippy. Or Tesco Express - whatever. Those guys make money producing stuff.
Deliveroo are an order processing and delivery company. They make money generating and delivering orders.
The problem is that for the food producer they can't just use Deliveroo. Or Gorillas. Or Ubereats. They need to use all of them. And don't care which. Punters increasingly use umbrella sites like Just Eat rather than Deliveroo as there is more choice.
So the producer makes money producing stuff. The delivery firm makes money via tech and physical; delivery. And that is the problem. They cannot make money unless the tech is established and the volume is enormous. Their commission does not cover their costs and they can't charge more commission because competition lowers the bar - nobody cares who delivers the food.
So yes, Deliveroo do care. They only get volume if the restaurant keeps using them. And there is too much competition. Hence the new idea of Deliveroo operating their own dark kitchen -they can't lose the custom and there is actual profit that can be used to subsidise their losses.
You're wrong in saying the producer makes money producing stuff. The producer should make money producing stuff, but the problem is the producer is having a large slice of their ticket price they should be making on being withheld by Deliveroo etc instead.
And all the hundreds of FoodCo's in your local area feel like they have no choice to be on all platforms, even though the platforms withhold the cash they should be making, because the alternative is they get no cash.
Why do you think 40% commission (as per that real world Chinese example) plus 10% service charge can't be profitable?
Why? Because those figures are wrong. Their total charge is more like 30% including the service charge depending on the area. If someone is being ripped at 50% then they quit and use one of the competitors.
I'm going to park this because you aren't paying any attention. It isn't what I think. It is what their investors know. The investors who see the real figures not your best guess figures.
Please, go buy shares in Deliveroo as you are so convinced they are a winner. They are a bargain at the moment having lost 60% of their value since the start of the year.
I never said Deliveroo are a bargain at the minute, I said they have the potential of being profitable. That is two very different things. There is a world of difference between profitable and to infinite and beyond stock prices.
Do I think Deliveroo can make a profit in the future? Yes.
Do I think they will make a profit that justifies a £1.5 billion market cap? Let alone a nearly £4 billion market cap earlier this year? No, that's a very different question.
The investors who see the figures also think they can make a profit in the future, otherwise the share price would be 0.
The Bozzatron looking slightly less fat the same day.. Perhaps because he did actually cycle for eight hours.
Cycling for 8 hours in a day at his age with the pressure he is under for his time and the way, in my experience, exercise is one of the things that gets squeezed, is a pretty serious effort in my book. I for one don't see this as something to mock.
Ride London - 100 miles.
Probably mainly flat, though.
I don't care if its all downhill. Don't mock the man for doing exercise.
The media bubble tosspots have got this one wrong. They are probably helping him.
Making those comments in the Queens speech debate during a cost of living crisis re not been able to budget and not being able to cook is an epic fail . The video isn’t going to repair that damage , most think he’s an out of touch twat who happily raked in the expenses.
Batch cooking seems to be a lost art - perhaps because of overemphasis in the cooking shows on cooking from first principles from scratch for every meal.
When I make bolognese sauce, I do it in a large batch - doesn't really work for small amounts. I freeze it using silicon molds (soap molds, actually).
The other thing that seems lost is the idea of having a couple of dishes in the fridge that are cooked, and you reheat a portion for a quick meal.
While neither of these is the answer to all cooking time issues, they are useful.
You keep seeming to look at this from the perspective of the dark kitchen though, rather than from the perspective of Deliveroo. I never claimed the dark kitchen would be profitable, did I?
You claimed that the commission was "a reduction in their profits" which for the dark kitchen is 100% true, but for Deliveroo it isn't, it is their revenue stream. The service charge they then charge the consumer is also a revenue stream for Deliveroo, so they have multiple revenue streams.
Whether their revenue exceeds their costs is a different question, but their service charges are categorically not their only revenue stream.
PS I think anyone setting up a "dark kitchen" its a mug's game. Deliveroo are keen to get people setting them up, because they can then charge money for it but if you're not selling drinks etc to consumers then its going to be very difficult for anyone operating a dark kitchen to turn a profit while paying Deliveroo etc too.
But Deliveroo don't care if the restaurants they 'serve' go bust and are replaced by new investors looking to set up a restaurant. That's another injection of investment cash going on right there, without Deliveroo needing to raise a penny of it, instead they're parasites on that.
You mentioned Dominos originally. Could be a Dominos franchise. Or a chippy. Or Tesco Express - whatever. Those guys make money producing stuff.
Deliveroo are an order processing and delivery company. They make money generating and delivering orders.
The problem is that for the food producer they can't just use Deliveroo. Or Gorillas. Or Ubereats. They need to use all of them. And don't care which. Punters increasingly use umbrella sites like Just Eat rather than Deliveroo as there is more choice.
So the producer makes money producing stuff. The delivery firm makes money via tech and physical; delivery. And that is the problem. They cannot make money unless the tech is established and the volume is enormous. Their commission does not cover their costs and they can't charge more commission because competition lowers the bar - nobody cares who delivers the food.
So yes, Deliveroo do care. They only get volume if the restaurant keeps using them. And there is too much competition. Hence the new idea of Deliveroo operating their own dark kitchen -they can't lose the custom and there is actual profit that can be used to subsidise their losses.
You're wrong in saying the producer makes money producing stuff. The producer should make money producing stuff, but the problem is the producer is having a large slice of their ticket price they should be making on being withheld by Deliveroo etc instead.
And all the hundreds of FoodCo's in your local area feel like they have no choice to be on all platforms, even though the platforms withhold the cash they should be making, because the alternative is they get no cash.
Why do you think 40% commission (as per that real world Chinese example) plus 10% service charge can't be profitable?
Why? Because those figures are wrong. Their total charge is more like 30% including the service charge depending on the area. If someone is being ripped at 50% then they quit and use one of the competitors.
I'm going to park this because you aren't paying any attention. It isn't what I think. It is what their investors know. The investors who see the real figures not your best guess figures.
Please, go buy shares in Deliveroo as you are so convinced they are a winner. They are a bargain at the moment having lost 60% of their value since the start of the year.
I never said Deliveroo are a bargain at the minute, I said they have the potential of being profitable. That is two very different things. There is a world of difference between profitable and to infinite and beyond stock prices.
Do I think Deliveroo can make a profit in the future? Yes.
Do I think they will make a profit that justifies a £1.5 billion market cap? Let alone a nearly £4 billion market cap earlier this year? No, that's a very different question.
The investors who see the figures also think they can make a profit in the future, otherwise the share price would be 0.
The value they have, is in the brand itself. The underlying business is unlikely to ever be profitable.
The Bank of England plans to keep interest rates at a record low until unemployment falls to 7% - something unlikely for another three years - in a major new departure for British monetary policy.
Barely a month after Canadian Mark Carney took over from the long-serving Mervyn King as BoE governor, the central bank said on Wednesday that it would keep interest rates at 0.5 percent unless inflation threatened to get out of control or there was a danger to financial stability
Unemployment went below 7% just five months later and it kept on falling. Today it stands at 3.8%.
The issue then was that we imported a lot of deflation from China. Raising interest rates may have ended up causing deflation.
There was also a truly massive deflationary effect from the gradual unwinding of the mountains of "fantasy money" that had been created on the back of CDOs and similar financial products post 2008 which went on for several years. That came close to driving several parts of the world into deflation and the EZ dipped into it more than once.
The British jobs miracle, post 2012, however, remains largely unexplained. Why did it happen here? How did so little of that growth end up being reflected in GDP? Are our GDP figures correct? What policies do we need to sustain high employment? Can we improve productivity within that mix? Are we right about productivity? The reason it is found to be so low is that we effectively divide the number of people in work by the output. As that number went up and the measured output didn't productivity fell, but did it?
These are not just historical issues. They are right at the centre of the economic challenges we face today. I am not sure I believe the official figures.
Surely this one is pretty simple. Different jobs deliver different levels of economic output. The "jobs miracle" delivered an awful lot of low paid low output low security jobs. Whilst I have a lot of respect for the physical effort made by the Uber Eats cyclists delivering people's booze and crisps order its hardly GDP-generating.
What we need to do - as has been the case for the lost decade back to 2012 - is invest in training and skills and manufacturing. Make more stuff, improve balance of payments, increase disposable incomes - the virtuous circle.
The problem is that in the 2008 era we replaced capitalism with bankism. Borrow cheap money, invest it, deliver a return on investment, reinvest the profits is now seen as "who will pay for it" subsidy.
But why did noone else in the EZ produce jobs like we did? That is the mystery. Our employment laws were largely set to European standards. We had a relatively high and increasing minimum wage (Germany didn't even have one for nearly all of that period). And the money spent on takeaways and deliveries was substantial in cumulo and should have boosted GDP by more than it did. My speculation is that we are not very good at measuring that kind of spending, partly because there is significant under declaration of it. We get the employment part because people need to be registered to get in work benefits but the money taken largely disappears from the figures.
There is a reason that very large numbers of Europeans come to the UK for jobs. And still do.
In a number of continental countries there are considerably higher protection for *some* parts of the workforce. In effect, there are higher costs for employment. So getting a job is harder.
So many come here, because jobs can be created easily.
But as noted previously, jobs growth in the EZ in the last 10 years was only a bit below ours in % terms.
The Bozzatron looking slightly less fat the same day.. Perhaps because he did actually cycle for eight hours.
He's clearly overweight. So what? People love to fat shame in this country. He also tries to take at least some exercise, which is better than many.
For all the thin people out there who have to watch what the eat, and exercise to stay slim there are others who are naturally prone to NOT get fat. My wife is one such. Her appetite regulates itself. When she is hungry, she eats, When she is not, she doesn't. Not hungry and the plate of biscuits will not be touched.
I'm different. I can eat whenever, hungry or not. I have a constant losing battle with weight. I exercise, not as much as I used to but age and annoying injuries get in the way. Take a picture of me and you will see an overweight 49 year old. Have I no will power? Or have I been dealt a different metabolism which responds in different ways to yours?
Fat shaming should not be acceptable.
There is enough to go after Johnson for - policies, lies, partygate, whatever. But having a pop at someone ACTUALLY TAKING EXERCISE is the lowest form of abuse.
You keep seeming to look at this from the perspective of the dark kitchen though, rather than from the perspective of Deliveroo. I never claimed the dark kitchen would be profitable, did I?
You claimed that the commission was "a reduction in their profits" which for the dark kitchen is 100% true, but for Deliveroo it isn't, it is their revenue stream. The service charge they then charge the consumer is also a revenue stream for Deliveroo, so they have multiple revenue streams.
Whether their revenue exceeds their costs is a different question, but their service charges are categorically not their only revenue stream.
PS I think anyone setting up a "dark kitchen" its a mug's game. Deliveroo are keen to get people setting them up, because they can then charge money for it but if you're not selling drinks etc to consumers then its going to be very difficult for anyone operating a dark kitchen to turn a profit while paying Deliveroo etc too.
But Deliveroo don't care if the restaurants they 'serve' go bust and are replaced by new investors looking to set up a restaurant. That's another injection of investment cash going on right there, without Deliveroo needing to raise a penny of it, instead they're parasites on that.
You mentioned Dominos originally. Could be a Dominos franchise. Or a chippy. Or Tesco Express - whatever. Those guys make money producing stuff.
Deliveroo are an order processing and delivery company. They make money generating and delivering orders.
The problem is that for the food producer they can't just use Deliveroo. Or Gorillas. Or Ubereats. They need to use all of them. And don't care which. Punters increasingly use umbrella sites like Just Eat rather than Deliveroo as there is more choice.
So the producer makes money producing stuff. The delivery firm makes money via tech and physical; delivery. And that is the problem. They cannot make money unless the tech is established and the volume is enormous. Their commission does not cover their costs and they can't charge more commission because competition lowers the bar - nobody cares who delivers the food.
So yes, Deliveroo do care. They only get volume if the restaurant keeps using them. And there is too much competition. Hence the new idea of Deliveroo operating their own dark kitchen -they can't lose the custom and there is actual profit that can be used to subsidise their losses.
You're wrong in saying the producer makes money producing stuff. The producer should make money producing stuff, but the problem is the producer is having a large slice of their ticket price they should be making on being withheld by Deliveroo etc instead.
And all the hundreds of FoodCo's in your local area feel like they have no choice to be on all platforms, even though the platforms withhold the cash they should be making, because the alternative is they get no cash.
Why do you think 40% commission (as per that real world Chinese example) plus 10% service charge can't be profitable?
Why? Because those figures are wrong. Their total charge is more like 30% including the service charge depending on the area. If someone is being ripped at 50% then they quit and use one of the competitors.
I'm going to park this because you aren't paying any attention. It isn't what I think. It is what their investors know. The investors who see the real figures not your best guess figures.
Please, go buy shares in Deliveroo as you are so convinced they are a winner. They are a bargain at the moment having lost 60% of their value since the start of the year.
I never said Deliveroo are a bargain at the minute, I said they have the potential of being profitable. That is two very different things. There is a world of difference between profitable and to infinite and beyond stock prices.
Do I think Deliveroo can make a profit in the future? Yes.
Do I think they will make a profit that justifies a £1.5 billion market cap? Let alone a nearly £4 billion market cap earlier this year? No, that's a very different question.
The investors who see the figures also think they can make a profit in the future, otherwise the share price would be 0.
The value they have, is in the brand itself. The underlying business is unlikely to ever be profitable.
Why don't you think they can make a profit charging 30-40% commission plus service charges, while only paying a pittance to the people delivering for them who are expected to do many deliveries per hour to get to £9 per hour?
Whether restaurants will make money with Deliveroo etc charging 30%+ commission is another matter.
For some reason Rochdale seems to think the fact that every FoodCo is on every DeliveryCo network now is bad news for the DeliveryCo's, it isn't. The fact that FoodCo feels they have no choice but to be on every network is precisely why they are and means DeliveryCo can charge exorbitant commissions and they get away with it.
OGH used to be more objective than he is now. To use the Daily Mirror to back up a case is always desperate and to suggest that Anderson was denigrating poor people is simply untrue. I would suggest that Anderson has actually improved his reputation with his very assured media performances this morning. If there were more like him in the Conservative Parliamentary party I would think the Conservatives would be faring better electorally. To those readers who haven't seen I would suggest that they listen to his whole speech on YouTube.
I think he didn't intend the victim-blaming that he's now effectively accused of, but the wording was unfortunate - he should have stopped at saying it would help if more people learned cooking, rather than speculate that if this happened than the massive need for food banks would disappear. After all, most food banks don't supply elaborate ready meals - they supply goods to cook.
It's an example of how careful MPs have to be in today's gotcha media climate, but it probably will have damaged him - most people won't watch the video or read his detailed comments.
The media bubble tosspots have got this one wrong. They are probably helping him.
Making those comments in the Queens speech debate during a cost of living crisis re not been able to budget and not being able to cook is an epic fail . The video isn’t going to repair that damage , most think he’s an out of touch twat who happily raked in the expenses.
Batch cooking seems to be a lost art - perhaps because of overemphasis in the cooking shows on cooking from first principles from scratch for every meal.
When I make bolognese sauce, I do it in a large batch - doesn't really work for small amounts. I freeze it using silicon molds (soap molds, actually).
The other thing that seems lost is the idea of having a couple of dishes in the fridge that are cooked, and you reheat a portion for a quick meal.
While neither of these is the answer to all cooking time issues, they are useful.
I do the same with bolognese ! Also curry .
Anderson should have just said my local food bank does batch cooking , take a look at my video . His comments just came across badly as they seemed patronizing and judgemental.
The media bubble tosspots have got this one wrong. They are probably helping him.
Making those comments in the Queens speech debate during a cost of living crisis re not been able to budget and not being able to cook is an epic fail . The video isn’t going to repair that damage , most think he’s an out of touch twat who happily raked in the expenses.
Batch cooking seems to be a lost art - perhaps because of overemphasis in the cooking shows on cooking from first principles from scratch for every meal.
When I make bolognese sauce, I do it in a large batch - doesn't really work for small amounts. I freeze it using silicon molds (soap molds, actually).
The other thing that seems lost is the idea of having a couple of dishes in the fridge that are cooked, and you reheat a portion for a quick meal.
While neither of these is the answer to all cooking time issues, they are useful.
My wife does this. If she makes for example a curry (for the two of us), she’ll make enough for half a dozen meals. Two for tonight, two for the fridge and two for the freezer. There’s always a freezer full of food that can be taken out in the morning, and reheated in the evening.
You keep seeming to look at this from the perspective of the dark kitchen though, rather than from the perspective of Deliveroo. I never claimed the dark kitchen would be profitable, did I?
You claimed that the commission was "a reduction in their profits" which for the dark kitchen is 100% true, but for Deliveroo it isn't, it is their revenue stream. The service charge they then charge the consumer is also a revenue stream for Deliveroo, so they have multiple revenue streams.
Whether their revenue exceeds their costs is a different question, but their service charges are categorically not their only revenue stream.
PS I think anyone setting up a "dark kitchen" its a mug's game. Deliveroo are keen to get people setting them up, because they can then charge money for it but if you're not selling drinks etc to consumers then its going to be very difficult for anyone operating a dark kitchen to turn a profit while paying Deliveroo etc too.
But Deliveroo don't care if the restaurants they 'serve' go bust and are replaced by new investors looking to set up a restaurant. That's another injection of investment cash going on right there, without Deliveroo needing to raise a penny of it, instead they're parasites on that.
You mentioned Dominos originally. Could be a Dominos franchise. Or a chippy. Or Tesco Express - whatever. Those guys make money producing stuff.
Deliveroo are an order processing and delivery company. They make money generating and delivering orders.
The problem is that for the food producer they can't just use Deliveroo. Or Gorillas. Or Ubereats. They need to use all of them. And don't care which. Punters increasingly use umbrella sites like Just Eat rather than Deliveroo as there is more choice.
So the producer makes money producing stuff. The delivery firm makes money via tech and physical; delivery. And that is the problem. They cannot make money unless the tech is established and the volume is enormous. Their commission does not cover their costs and they can't charge more commission because competition lowers the bar - nobody cares who delivers the food.
So yes, Deliveroo do care. They only get volume if the restaurant keeps using them. And there is too much competition. Hence the new idea of Deliveroo operating their own dark kitchen -they can't lose the custom and there is actual profit that can be used to subsidise their losses.
You're wrong in saying the producer makes money producing stuff. The producer should make money producing stuff, but the problem is the producer is having a large slice of their ticket price they should be making on being withheld by Deliveroo etc instead.
And all the hundreds of FoodCo's in your local area feel like they have no choice to be on all platforms, even though the platforms withhold the cash they should be making, because the alternative is they get no cash.
Why do you think 40% commission (as per that real world Chinese example) plus 10% service charge can't be profitable?
Why? Because those figures are wrong. Their total charge is more like 30% including the service charge depending on the area. If someone is being ripped at 50% then they quit and use one of the competitors.
I'm going to park this because you aren't paying any attention. It isn't what I think. It is what their investors know. The investors who see the real figures not your best guess figures.
Please, go buy shares in Deliveroo as you are so convinced they are a winner. They are a bargain at the moment having lost 60% of their value since the start of the year.
I never said Deliveroo are a bargain at the minute, I said they have the potential of being profitable. That is two very different things. There is a world of difference between profitable and to infinite and beyond stock prices.
Do I think Deliveroo can make a profit in the future? Yes.
Do I think they will make a profit that justifies a £1.5 billion market cap? Let alone a nearly £4 billion market cap earlier this year? No, that's a very different question.
The investors who see the figures also think they can make a profit in the future, otherwise the share price would be 0.
The only way this entire sector can make money is if they have huge volume, have stable prices, and remove as much of their variable costs (delivery staff) as possible.
Its simply a fact that they lose money. A lot of money. Their own figures tell you that. Their c 30% fee doesn't cover their costs and there are always new competitors out there vying for business by undercutting even this loss-making position. They can't make money by doing more volume - their long term goal - because they lose money every transaction.
So to pull it all back to the beginning, this is a Tulip Bulbs ponzi scheme. There is money to be made speculating on the sector, but not from the sector itself. It will collapse spectacularly.
The London media bubble tosspots have got this one wrong. They are probably helping him.
Aside from the fact that £50 divided by 170 meals is just under 30p per meal, not 30p per day.. Other than the bad maths, I agree with him.
Its always cheaper to make bulk food than small quantities. 170 meals is a stupid thing to quote as the per meal cost will be a lot more if you are making a week's worth of meals for yourself instead of meals for 170 people to eat immediately.
He doesn't get it, but his "I did not patronise you" response is itself patronising.
The media bubble tosspots have got this one wrong. They are probably helping him.
Making those comments in the Queens speech debate during a cost of living crisis re not been able to budget and not being able to cook is an epic fail . The video isn’t going to repair that damage , most think he’s an out of touch twat who happily raked in the expenses.
Batch cooking seems to be a lost art - perhaps because of overemphasis in the cooking shows on cooking from first principles from scratch for every meal.
When I make bolognese sauce, I do it in a large batch - doesn't really work for small amounts. I freeze it using silicon molds (soap molds, actually).
The other thing that seems lost is the idea of having a couple of dishes in the fridge that are cooked, and you reheat a portion for a quick meal.
While neither of these is the answer to all cooking time issues, they are useful.
My wife does this. If she makes for example a curry (for the two of us), she’ll make enough for half a dozen meals. Two for tonight, two for the fridge and two for the freezer. There’s always a freezer full of food that can be taken out in the morning, and reheated in the evening.
The soap molds were a discovery - before that tried freezing in disposable boxes etc. The molds work like giant ice cube trays - so you get a useful block of the frozen food, without any plastic or whatever stuck to it.
So when defrosting, you can do stuff like put them in a sauce pot with a barely running burner under it - defrost in about 5 minutes....
You keep seeming to look at this from the perspective of the dark kitchen though, rather than from the perspective of Deliveroo. I never claimed the dark kitchen would be profitable, did I?
You claimed that the commission was "a reduction in their profits" which for the dark kitchen is 100% true, but for Deliveroo it isn't, it is their revenue stream. The service charge they then charge the consumer is also a revenue stream for Deliveroo, so they have multiple revenue streams.
Whether their revenue exceeds their costs is a different question, but their service charges are categorically not their only revenue stream.
PS I think anyone setting up a "dark kitchen" its a mug's game. Deliveroo are keen to get people setting them up, because they can then charge money for it but if you're not selling drinks etc to consumers then its going to be very difficult for anyone operating a dark kitchen to turn a profit while paying Deliveroo etc too.
But Deliveroo don't care if the restaurants they 'serve' go bust and are replaced by new investors looking to set up a restaurant. That's another injection of investment cash going on right there, without Deliveroo needing to raise a penny of it, instead they're parasites on that.
You mentioned Dominos originally. Could be a Dominos franchise. Or a chippy. Or Tesco Express - whatever. Those guys make money producing stuff.
Deliveroo are an order processing and delivery company. They make money generating and delivering orders.
The problem is that for the food producer they can't just use Deliveroo. Or Gorillas. Or Ubereats. They need to use all of them. And don't care which. Punters increasingly use umbrella sites like Just Eat rather than Deliveroo as there is more choice.
So the producer makes money producing stuff. The delivery firm makes money via tech and physical; delivery. And that is the problem. They cannot make money unless the tech is established and the volume is enormous. Their commission does not cover their costs and they can't charge more commission because competition lowers the bar - nobody cares who delivers the food.
So yes, Deliveroo do care. They only get volume if the restaurant keeps using them. And there is too much competition. Hence the new idea of Deliveroo operating their own dark kitchen -they can't lose the custom and there is actual profit that can be used to subsidise their losses.
You're wrong in saying the producer makes money producing stuff. The producer should make money producing stuff, but the problem is the producer is having a large slice of their ticket price they should be making on being withheld by Deliveroo etc instead.
And all the hundreds of FoodCo's in your local area feel like they have no choice to be on all platforms, even though the platforms withhold the cash they should be making, because the alternative is they get no cash.
Why do you think 40% commission (as per that real world Chinese example) plus 10% service charge can't be profitable?
Why? Because those figures are wrong. Their total charge is more like 30% including the service charge depending on the area. If someone is being ripped at 50% then they quit and use one of the competitors.
I'm going to park this because you aren't paying any attention. It isn't what I think. It is what their investors know. The investors who see the real figures not your best guess figures.
Please, go buy shares in Deliveroo as you are so convinced they are a winner. They are a bargain at the moment having lost 60% of their value since the start of the year.
I never said Deliveroo are a bargain at the minute, I said they have the potential of being profitable. That is two very different things. There is a world of difference between profitable and to infinite and beyond stock prices.
Do I think Deliveroo can make a profit in the future? Yes.
Do I think they will make a profit that justifies a £1.5 billion market cap? Let alone a nearly £4 billion market cap earlier this year? No, that's a very different question.
The investors who see the figures also think they can make a profit in the future, otherwise the share price would be 0.
The value they have, is in the brand itself. The underlying business is unlikely to ever be profitable.
Why don't you think they can make a profit charging 30-40% commission plus service charges, while only paying a pittance to the people delivering for them who are expected to do many deliveries per hour to get to £9 per hour?
Whether restaurants will make money with Deliveroo etc charging 30%+ commission is another matter.
For some reason Rochdale seems to think the fact that every FoodCo is on every DeliveryCo network now is bad news for the DeliveryCo's, it isn't. The fact that FoodCo feels they have no choice but to be on every network is precisely why they are and means DeliveryCo can charge exorbitant commissions and they get away with it.
The issue is, that the many DeliveryCos have massive marketing costs, as they are competing with each other, and still can’t make close to a profit while they have humans doing the deliveries, despite the commissions they charge to restaurants.
You and I agree on most things, but @RochdalePioneers is right on this one. Unless we can get the robot overlords doing deliveries.
OGH used to be more objective than he is now. To use the Daily Mirror to back up a case is always desperate and to suggest that Anderson was denigrating poor people is simply untrue. I would suggest that Anderson has actually improved his reputation with his very assured media performances this morning. If there were more like him in the Conservative Parliamentary party I would think the Conservatives would be faring better electorally. To those readers who haven't seen I would suggest that they listen to his whole speech on YouTube.
I think he didn't intend the victim-blaming that he's now effectively accused of, but the wording was unfortunate - he should have stopped at saying it would help if more people learned cooking, rather than speculate that if this happened than the massive need for food banks would disappear. After all, most food banks don't supply elaborate ready meals - they supply goods to cook.
It's an example of how careful MPs have to be in today's gotcha media climate, but it probably will have damaged him - most people won't watch the video or read his detailed comments.
As usual the reporting is irresponsible. The confected outrage encouraging anger and hatred, the casual throwing in of his not unusual expenses to try and insinuate something is amiss there..... irresponsible dangerous reporting designed to provoke. That's why the media are seen by many as extremely unpleasant human beings
You keep seeming to look at this from the perspective of the dark kitchen though, rather than from the perspective of Deliveroo. I never claimed the dark kitchen would be profitable, did I?
You claimed that the commission was "a reduction in their profits" which for the dark kitchen is 100% true, but for Deliveroo it isn't, it is their revenue stream. The service charge they then charge the consumer is also a revenue stream for Deliveroo, so they have multiple revenue streams.
Whether their revenue exceeds their costs is a different question, but their service charges are categorically not their only revenue stream.
PS I think anyone setting up a "dark kitchen" its a mug's game. Deliveroo are keen to get people setting them up, because they can then charge money for it but if you're not selling drinks etc to consumers then its going to be very difficult for anyone operating a dark kitchen to turn a profit while paying Deliveroo etc too.
But Deliveroo don't care if the restaurants they 'serve' go bust and are replaced by new investors looking to set up a restaurant. That's another injection of investment cash going on right there, without Deliveroo needing to raise a penny of it, instead they're parasites on that.
You mentioned Dominos originally. Could be a Dominos franchise. Or a chippy. Or Tesco Express - whatever. Those guys make money producing stuff.
Deliveroo are an order processing and delivery company. They make money generating and delivering orders.
The problem is that for the food producer they can't just use Deliveroo. Or Gorillas. Or Ubereats. They need to use all of them. And don't care which. Punters increasingly use umbrella sites like Just Eat rather than Deliveroo as there is more choice.
So the producer makes money producing stuff. The delivery firm makes money via tech and physical; delivery. And that is the problem. They cannot make money unless the tech is established and the volume is enormous. Their commission does not cover their costs and they can't charge more commission because competition lowers the bar - nobody cares who delivers the food.
So yes, Deliveroo do care. They only get volume if the restaurant keeps using them. And there is too much competition. Hence the new idea of Deliveroo operating their own dark kitchen -they can't lose the custom and there is actual profit that can be used to subsidise their losses.
You're wrong in saying the producer makes money producing stuff. The producer should make money producing stuff, but the problem is the producer is having a large slice of their ticket price they should be making on being withheld by Deliveroo etc instead.
And all the hundreds of FoodCo's in your local area feel like they have no choice to be on all platforms, even though the platforms withhold the cash they should be making, because the alternative is they get no cash.
Why do you think 40% commission (as per that real world Chinese example) plus 10% service charge can't be profitable?
Why? Because those figures are wrong. Their total charge is more like 30% including the service charge depending on the area. If someone is being ripped at 50% then they quit and use one of the competitors.
I'm going to park this because you aren't paying any attention. It isn't what I think. It is what their investors know. The investors who see the real figures not your best guess figures.
Please, go buy shares in Deliveroo as you are so convinced they are a winner. They are a bargain at the moment having lost 60% of their value since the start of the year.
I never said Deliveroo are a bargain at the minute, I said they have the potential of being profitable. That is two very different things. There is a world of difference between profitable and to infinite and beyond stock prices.
Do I think Deliveroo can make a profit in the future? Yes.
Do I think they will make a profit that justifies a £1.5 billion market cap? Let alone a nearly £4 billion market cap earlier this year? No, that's a very different question.
The investors who see the figures also think they can make a profit in the future, otherwise the share price would be 0.
The value they have, is in the brand itself. The underlying business is unlikely to ever be profitable.
Why don't you think they can make a profit charging 30-40% commission plus service charges, while only paying a pittance to the people delivering for them who are expected to do many deliveries per hour to get to £9 per hour?
Whether restaurants will make money with Deliveroo etc charging 30%+ commission is another matter.
For some reason Rochdale seems to think the fact that every FoodCo is on every DeliveryCo network now is bad news for the DeliveryCo's, it isn't. The fact that FoodCo feels they have no choice but to be on every network is precisely why they are and means DeliveryCo can charge exorbitant commissions and they get away with it.
Genuinely giggling reading this. Its another subject where you are taking your theoretical ideas disconnected from the real world and proceed to lecture the industry on how they are wrong. Bravo.
That last line in particular - genius. Having just spent half an hour reading how all the competitors are undercutting each other to fight for market share you are still saying they can "charge exorbitant commissions and [] get away with it"
As they lose money on each delivery - on their own figures - they are hardly exorbitant. And the market competition means that can't and DON'T get away with it. Why stick with Deliveroo if Gorillas are cheaper? Or why bother with any of them at all when you can use Just Eat and not care who does the delivery?
Please, you should do a Ted talk on it. Tell Deliveroo how they have got their industry wrong. We could watch. I'd pay!
You keep seeming to look at this from the perspective of the dark kitchen though, rather than from the perspective of Deliveroo. I never claimed the dark kitchen would be profitable, did I?
You claimed that the commission was "a reduction in their profits" which for the dark kitchen is 100% true, but for Deliveroo it isn't, it is their revenue stream. The service charge they then charge the consumer is also a revenue stream for Deliveroo, so they have multiple revenue streams.
Whether their revenue exceeds their costs is a different question, but their service charges are categorically not their only revenue stream.
PS I think anyone setting up a "dark kitchen" its a mug's game. Deliveroo are keen to get people setting them up, because they can then charge money for it but if you're not selling drinks etc to consumers then its going to be very difficult for anyone operating a dark kitchen to turn a profit while paying Deliveroo etc too.
But Deliveroo don't care if the restaurants they 'serve' go bust and are replaced by new investors looking to set up a restaurant. That's another injection of investment cash going on right there, without Deliveroo needing to raise a penny of it, instead they're parasites on that.
You mentioned Dominos originally. Could be a Dominos franchise. Or a chippy. Or Tesco Express - whatever. Those guys make money producing stuff.
Deliveroo are an order processing and delivery company. They make money generating and delivering orders.
The problem is that for the food producer they can't just use Deliveroo. Or Gorillas. Or Ubereats. They need to use all of them. And don't care which. Punters increasingly use umbrella sites like Just Eat rather than Deliveroo as there is more choice.
So the producer makes money producing stuff. The delivery firm makes money via tech and physical; delivery. And that is the problem. They cannot make money unless the tech is established and the volume is enormous. Their commission does not cover their costs and they can't charge more commission because competition lowers the bar - nobody cares who delivers the food.
So yes, Deliveroo do care. They only get volume if the restaurant keeps using them. And there is too much competition. Hence the new idea of Deliveroo operating their own dark kitchen -they can't lose the custom and there is actual profit that can be used to subsidise their losses.
You're wrong in saying the producer makes money producing stuff. The producer should make money producing stuff, but the problem is the producer is having a large slice of their ticket price they should be making on being withheld by Deliveroo etc instead.
And all the hundreds of FoodCo's in your local area feel like they have no choice to be on all platforms, even though the platforms withhold the cash they should be making, because the alternative is they get no cash.
Why do you think 40% commission (as per that real world Chinese example) plus 10% service charge can't be profitable?
Why? Because those figures are wrong. Their total charge is more like 30% including the service charge depending on the area. If someone is being ripped at 50% then they quit and use one of the competitors.
I'm going to park this because you aren't paying any attention. It isn't what I think. It is what their investors know. The investors who see the real figures not your best guess figures.
Please, go buy shares in Deliveroo as you are so convinced they are a winner. They are a bargain at the moment having lost 60% of their value since the start of the year.
I never said Deliveroo are a bargain at the minute, I said they have the potential of being profitable. That is two very different things. There is a world of difference between profitable and to infinite and beyond stock prices.
Do I think Deliveroo can make a profit in the future? Yes.
Do I think they will make a profit that justifies a £1.5 billion market cap? Let alone a nearly £4 billion market cap earlier this year? No, that's a very different question.
The investors who see the figures also think they can make a profit in the future, otherwise the share price would be 0.
The only way this entire sector can make money is if they have huge volume, have stable prices, and remove as much of their variable costs (delivery staff) as possible.
Its simply a fact that they lose money. A lot of money. Their own figures tell you that. Their c 30% fee doesn't cover their costs and there are always new competitors out there vying for business by undercutting even this loss-making position. They can't make money by doing more volume - their long term goal - because they lose money every transaction.
So to pull it all back to the beginning, this is a Tulip Bulbs ponzi scheme. There is money to be made speculating on the sector, but not from the sector itself. It will collapse spectacularly.
Huge volume ✅ - they have this. Stable Prices - no, they have been rapidly increasing prices in recent years, which is good for them. Remove as much variable costs as possible ✅ - They do this.
Yes they lose money, but they've been rapidly growing and are now in almost every part of the nation and have a very significant proportion of restaurants in the nation.
They're following a similar path to Amazon who are very profitable but weren't for years - a period of rapid expansion, then stop selling at below costs. They've got themselves embedded so people are hooked on using them, now they've started raising prices. I would be surprised if Deliveroo don't start registering profits within the next couple of years now.
You're categorically wrong in claiming that they lose money every transaction so lose more money by growing. In 2021 their revenues increased by 54% while their net loss fell from £317m to £223m.
Using your logic, their revenues increasing by 54% should have seen their net loss increase to £488m which is more than double what it actually was.
The Bozzatron looking slightly less fat the same day.. Perhaps because he did actually cycle for eight hours.
He's clearly overweight. So what? People love to fat shame in this country. He also tries to take at least some exercise, which is better than many.
For all the thin people out there who have to watch what the eat, and exercise to stay slim there are others who are naturally prone to NOT get fat. My wife is one such. Her appetite regulates itself. When she is hungry, she eats, When she is not, she doesn't. Not hungry and the plate of biscuits will not be touched.
I'm different. I can eat whenever, hungry or not. I have a constant losing battle with weight. I exercise, not as much as I used to but age and annoying injuries get in the way. Take a picture of me and you will see an overweight 49 year old. Have I no will power? Or have I been dealt a different metabolism which responds in different ways to yours?
Fat shaming should not be acceptable.
There is enough to go after Johnson for - policies, lies, partygate, whatever. But having a pop at someone ACTUALLY TAKING EXERCISE is the lowest form of abuse.
Really?
Shame can be quite a motivator. One of the reasons French, Italian and Japanese people don’t get as fat as Brits, Yanks, etc, is because it is seen as shameful to let yourself go to that extent. You must present the bella figura
We could do with some of that shame. The state of some Brits out here in Greece/Turkey. Jesus FC. Go on a fucking diet you grotesque blob
You keep seeming to look at this from the perspective of the dark kitchen though, rather than from the perspective of Deliveroo. I never claimed the dark kitchen would be profitable, did I?
You claimed that the commission was "a reduction in their profits" which for the dark kitchen is 100% true, but for Deliveroo it isn't, it is their revenue stream. The service charge they then charge the consumer is also a revenue stream for Deliveroo, so they have multiple revenue streams.
Whether their revenue exceeds their costs is a different question, but their service charges are categorically not their only revenue stream.
PS I think anyone setting up a "dark kitchen" its a mug's game. Deliveroo are keen to get people setting them up, because they can then charge money for it but if you're not selling drinks etc to consumers then its going to be very difficult for anyone operating a dark kitchen to turn a profit while paying Deliveroo etc too.
But Deliveroo don't care if the restaurants they 'serve' go bust and are replaced by new investors looking to set up a restaurant. That's another injection of investment cash going on right there, without Deliveroo needing to raise a penny of it, instead they're parasites on that.
You mentioned Dominos originally. Could be a Dominos franchise. Or a chippy. Or Tesco Express - whatever. Those guys make money producing stuff.
Deliveroo are an order processing and delivery company. They make money generating and delivering orders.
The problem is that for the food producer they can't just use Deliveroo. Or Gorillas. Or Ubereats. They need to use all of them. And don't care which. Punters increasingly use umbrella sites like Just Eat rather than Deliveroo as there is more choice.
So the producer makes money producing stuff. The delivery firm makes money via tech and physical; delivery. And that is the problem. They cannot make money unless the tech is established and the volume is enormous. Their commission does not cover their costs and they can't charge more commission because competition lowers the bar - nobody cares who delivers the food.
So yes, Deliveroo do care. They only get volume if the restaurant keeps using them. And there is too much competition. Hence the new idea of Deliveroo operating their own dark kitchen -they can't lose the custom and there is actual profit that can be used to subsidise their losses.
You're wrong in saying the producer makes money producing stuff. The producer should make money producing stuff, but the problem is the producer is having a large slice of their ticket price they should be making on being withheld by Deliveroo etc instead.
And all the hundreds of FoodCo's in your local area feel like they have no choice to be on all platforms, even though the platforms withhold the cash they should be making, because the alternative is they get no cash.
Why do you think 40% commission (as per that real world Chinese example) plus 10% service charge can't be profitable?
Why? Because those figures are wrong. Their total charge is more like 30% including the service charge depending on the area. If someone is being ripped at 50% then they quit and use one of the competitors.
I'm going to park this because you aren't paying any attention. It isn't what I think. It is what their investors know. The investors who see the real figures not your best guess figures.
Please, go buy shares in Deliveroo as you are so convinced they are a winner. They are a bargain at the moment having lost 60% of their value since the start of the year.
I never said Deliveroo are a bargain at the minute, I said they have the potential of being profitable. That is two very different things. There is a world of difference between profitable and to infinite and beyond stock prices.
Do I think Deliveroo can make a profit in the future? Yes.
Do I think they will make a profit that justifies a £1.5 billion market cap? Let alone a nearly £4 billion market cap earlier this year? No, that's a very different question.
The investors who see the figures also think they can make a profit in the future, otherwise the share price would be 0.
The value they have, is in the brand itself. The underlying business is unlikely to ever be profitable.
Why don't you think they can make a profit charging 30-40% commission plus service charges, while only paying a pittance to the people delivering for them who are expected to do many deliveries per hour to get to £9 per hour?
Whether restaurants will make money with Deliveroo etc charging 30%+ commission is another matter.
For some reason Rochdale seems to think the fact that every FoodCo is on every DeliveryCo network now is bad news for the DeliveryCo's, it isn't. The fact that FoodCo feels they have no choice but to be on every network is precisely why they are and means DeliveryCo can charge exorbitant commissions and they get away with it.
The issue is, that the many DeliveryCos have massive marketing costs, as they are competing with each other, and still can’t make close to a profit while they have humans doing the deliveries, despite the commissions they charge to restaurants.
You and I agree on most things, but @RochdalePioneers is right on this one. Unless we can get the robot overlords doing deliveries.
Absolutely marketing etc is a major cost and would remain a major cost even if they replaced all humans with robots.
Considering how shit these companies treat the drivers delivering for them, I'm not convinced robotics would make the businesses any more profitable. Robots would come with their own costs too and marketing would remain an issue. Robot drivers is vapourware to scam investors not the magic cure to make the business profitable.
You keep seeming to look at this from the perspective of the dark kitchen though, rather than from the perspective of Deliveroo. I never claimed the dark kitchen would be profitable, did I?
You claimed that the commission was "a reduction in their profits" which for the dark kitchen is 100% true, but for Deliveroo it isn't, it is their revenue stream. The service charge they then charge the consumer is also a revenue stream for Deliveroo, so they have multiple revenue streams.
Whether their revenue exceeds their costs is a different question, but their service charges are categorically not their only revenue stream.
PS I think anyone setting up a "dark kitchen" its a mug's game. Deliveroo are keen to get people setting them up, because they can then charge money for it but if you're not selling drinks etc to consumers then its going to be very difficult for anyone operating a dark kitchen to turn a profit while paying Deliveroo etc too.
But Deliveroo don't care if the restaurants they 'serve' go bust and are replaced by new investors looking to set up a restaurant. That's another injection of investment cash going on right there, without Deliveroo needing to raise a penny of it, instead they're parasites on that.
You mentioned Dominos originally. Could be a Dominos franchise. Or a chippy. Or Tesco Express - whatever. Those guys make money producing stuff.
Deliveroo are an order processing and delivery company. They make money generating and delivering orders.
The problem is that for the food producer they can't just use Deliveroo. Or Gorillas. Or Ubereats. They need to use all of them. And don't care which. Punters increasingly use umbrella sites like Just Eat rather than Deliveroo as there is more choice.
So the producer makes money producing stuff. The delivery firm makes money via tech and physical; delivery. And that is the problem. They cannot make money unless the tech is established and the volume is enormous. Their commission does not cover their costs and they can't charge more commission because competition lowers the bar - nobody cares who delivers the food.
So yes, Deliveroo do care. They only get volume if the restaurant keeps using them. And there is too much competition. Hence the new idea of Deliveroo operating their own dark kitchen -they can't lose the custom and there is actual profit that can be used to subsidise their losses.
You're wrong in saying the producer makes money producing stuff. The producer should make money producing stuff, but the problem is the producer is having a large slice of their ticket price they should be making on being withheld by Deliveroo etc instead.
And all the hundreds of FoodCo's in your local area feel like they have no choice to be on all platforms, even though the platforms withhold the cash they should be making, because the alternative is they get no cash.
Why do you think 40% commission (as per that real world Chinese example) plus 10% service charge can't be profitable?
Why? Because those figures are wrong. Their total charge is more like 30% including the service charge depending on the area. If someone is being ripped at 50% then they quit and use one of the competitors.
I'm going to park this because you aren't paying any attention. It isn't what I think. It is what their investors know. The investors who see the real figures not your best guess figures.
Please, go buy shares in Deliveroo as you are so convinced they are a winner. They are a bargain at the moment having lost 60% of their value since the start of the year.
I never said Deliveroo are a bargain at the minute, I said they have the potential of being profitable. That is two very different things. There is a world of difference between profitable and to infinite and beyond stock prices.
Do I think Deliveroo can make a profit in the future? Yes.
Do I think they will make a profit that justifies a £1.5 billion market cap? Let alone a nearly £4 billion market cap earlier this year? No, that's a very different question.
The investors who see the figures also think they can make a profit in the future, otherwise the share price would be 0.
The only way this entire sector can make money is if they have huge volume, have stable prices, and remove as much of their variable costs (delivery staff) as possible.
Its simply a fact that they lose money. A lot of money. Their own figures tell you that. Their c 30% fee doesn't cover their costs and there are always new competitors out there vying for business by undercutting even this loss-making position. They can't make money by doing more volume - their long term goal - because they lose money every transaction.
So to pull it all back to the beginning, this is a Tulip Bulbs ponzi scheme. There is money to be made speculating on the sector, but not from the sector itself. It will collapse spectacularly.
Huge volume ✅ - they have this. Stable Prices - no, they have been rapidly increasing prices in recent years, which is good for them. Remove as much variable costs as possible ✅ - They do this.
Yes they lose money, but they've been rapidly growing and are now in almost every part of the nation and have a very significant proportion of restaurants in the nation.
They're following a similar path to Amazon who are very profitable but weren't for years - a period of rapid expansion, then stop selling at below costs. They've got themselves embedded so people are hooked on using them, now they've started raising prices. I would be surprised if Deliveroo don't start registering profits within the next couple of years now.
You're categorically wrong in claiming that they lose money every transaction so lose more money by growing. In 2021 their revenues increased by 54% while their net loss fell from £317m to £223m.
Using your logic, their revenues increasing by 54% should have seen their net loss increase to £488m which is more than double what it actually was.
It's also worth noting that they have done a deal with Amazon so the service charge is removed for deliveries over a certain amount, for Prime customers. This is a smart move.
You keep seeming to look at this from the perspective of the dark kitchen though, rather than from the perspective of Deliveroo. I never claimed the dark kitchen would be profitable, did I?
You claimed that the commission was "a reduction in their profits" which for the dark kitchen is 100% true, but for Deliveroo it isn't, it is their revenue stream. The service charge they then charge the consumer is also a revenue stream for Deliveroo, so they have multiple revenue streams.
Whether their revenue exceeds their costs is a different question, but their service charges are categorically not their only revenue stream.
PS I think anyone setting up a "dark kitchen" its a mug's game. Deliveroo are keen to get people setting them up, because they can then charge money for it but if you're not selling drinks etc to consumers then its going to be very difficult for anyone operating a dark kitchen to turn a profit while paying Deliveroo etc too.
But Deliveroo don't care if the restaurants they 'serve' go bust and are replaced by new investors looking to set up a restaurant. That's another injection of investment cash going on right there, without Deliveroo needing to raise a penny of it, instead they're parasites on that.
You mentioned Dominos originally. Could be a Dominos franchise. Or a chippy. Or Tesco Express - whatever. Those guys make money producing stuff.
Deliveroo are an order processing and delivery company. They make money generating and delivering orders.
The problem is that for the food producer they can't just use Deliveroo. Or Gorillas. Or Ubereats. They need to use all of them. And don't care which. Punters increasingly use umbrella sites like Just Eat rather than Deliveroo as there is more choice.
So the producer makes money producing stuff. The delivery firm makes money via tech and physical; delivery. And that is the problem. They cannot make money unless the tech is established and the volume is enormous. Their commission does not cover their costs and they can't charge more commission because competition lowers the bar - nobody cares who delivers the food.
So yes, Deliveroo do care. They only get volume if the restaurant keeps using them. And there is too much competition. Hence the new idea of Deliveroo operating their own dark kitchen -they can't lose the custom and there is actual profit that can be used to subsidise their losses.
You're wrong in saying the producer makes money producing stuff. The producer should make money producing stuff, but the problem is the producer is having a large slice of their ticket price they should be making on being withheld by Deliveroo etc instead.
And all the hundreds of FoodCo's in your local area feel like they have no choice to be on all platforms, even though the platforms withhold the cash they should be making, because the alternative is they get no cash.
Why do you think 40% commission (as per that real world Chinese example) plus 10% service charge can't be profitable?
Why? Because those figures are wrong. Their total charge is more like 30% including the service charge depending on the area. If someone is being ripped at 50% then they quit and use one of the competitors.
I'm going to park this because you aren't paying any attention. It isn't what I think. It is what their investors know. The investors who see the real figures not your best guess figures.
Please, go buy shares in Deliveroo as you are so convinced they are a winner. They are a bargain at the moment having lost 60% of their value since the start of the year.
I never said Deliveroo are a bargain at the minute, I said they have the potential of being profitable. That is two very different things. There is a world of difference between profitable and to infinite and beyond stock prices.
Do I think Deliveroo can make a profit in the future? Yes.
Do I think they will make a profit that justifies a £1.5 billion market cap? Let alone a nearly £4 billion market cap earlier this year? No, that's a very different question.
The investors who see the figures also think they can make a profit in the future, otherwise the share price would be 0.
The value they have, is in the brand itself. The underlying business is unlikely to ever be profitable.
Why don't you think they can make a profit charging 30-40% commission plus service charges, while only paying a pittance to the people delivering for them who are expected to do many deliveries per hour to get to £9 per hour?
Whether restaurants will make money with Deliveroo etc charging 30%+ commission is another matter.
For some reason Rochdale seems to think the fact that every FoodCo is on every DeliveryCo network now is bad news for the DeliveryCo's, it isn't. The fact that FoodCo feels they have no choice but to be on every network is precisely why they are and means DeliveryCo can charge exorbitant commissions and they get away with it.
The issue is, that the many DeliveryCos have massive marketing costs, as they are competing with each other, and still can’t make close to a profit while they have humans doing the deliveries, despite the commissions they charge to restaurants.
You and I agree on most things, but @RochdalePioneers is right on this one. Unless we can get the robot overlords doing deliveries.
1. The model only works with massive volume 2. You only get that by becoming ubiquitous as Amazon have 3. So you market the shit out of yourself. All consumer facing. As anyone who understands advertising knows, the ROI is pitiful 4. You get talked about in the industry and show huuuuge volume growth albeit by burning through 9 figures of other people's cash each year 5. You need more cash. Go back to the investor market. Show your successful year losing £292m from your 300m transactions 6. Realising that all you are is a simple tech platform and a bloke on a bike the new investors decide not to invest in the existing one and instead set up their own so that 9 figures of someone else's money comes to you instead of them 6. Goto 1
The London media bubble tosspots have got this one wrong. They are probably helping him.
Aside from the fact that £50 divided by 170 meals is just under 30p per meal, not 30p per day.. Other than the bad maths, I agree with him.
Its always cheaper to make bulk food than small quantities. 170 meals is a stupid thing to quote as the per meal cost will be a lot more if you are making a week's worth of meals for yourself instead of meals for 170 people to eat immediately.
He doesn't get it, but his "I did not patronise you" response is itself patronising.
Storing 170 meals is not going to be possible for most families. The answer I think he is pointing to is that it would be more efficient for a centralized provider to offer people meals, making them free to those on low incomes. Perhaps they could do this in... oh I don't know... schools?
You keep seeming to look at this from the perspective of the dark kitchen though, rather than from the perspective of Deliveroo. I never claimed the dark kitchen would be profitable, did I?
You claimed that the commission was "a reduction in their profits" which for the dark kitchen is 100% true, but for Deliveroo it isn't, it is their revenue stream. The service charge they then charge the consumer is also a revenue stream for Deliveroo, so they have multiple revenue streams.
Whether their revenue exceeds their costs is a different question, but their service charges are categorically not their only revenue stream.
PS I think anyone setting up a "dark kitchen" its a mug's game. Deliveroo are keen to get people setting them up, because they can then charge money for it but if you're not selling drinks etc to consumers then its going to be very difficult for anyone operating a dark kitchen to turn a profit while paying Deliveroo etc too.
But Deliveroo don't care if the restaurants they 'serve' go bust and are replaced by new investors looking to set up a restaurant. That's another injection of investment cash going on right there, without Deliveroo needing to raise a penny of it, instead they're parasites on that.
You mentioned Dominos originally. Could be a Dominos franchise. Or a chippy. Or Tesco Express - whatever. Those guys make money producing stuff.
Deliveroo are an order processing and delivery company. They make money generating and delivering orders.
The problem is that for the food producer they can't just use Deliveroo. Or Gorillas. Or Ubereats. They need to use all of them. And don't care which. Punters increasingly use umbrella sites like Just Eat rather than Deliveroo as there is more choice.
So the producer makes money producing stuff. The delivery firm makes money via tech and physical; delivery. And that is the problem. They cannot make money unless the tech is established and the volume is enormous. Their commission does not cover their costs and they can't charge more commission because competition lowers the bar - nobody cares who delivers the food.
So yes, Deliveroo do care. They only get volume if the restaurant keeps using them. And there is too much competition. Hence the new idea of Deliveroo operating their own dark kitchen -they can't lose the custom and there is actual profit that can be used to subsidise their losses.
You're wrong in saying the producer makes money producing stuff. The producer should make money producing stuff, but the problem is the producer is having a large slice of their ticket price they should be making on being withheld by Deliveroo etc instead.
And all the hundreds of FoodCo's in your local area feel like they have no choice to be on all platforms, even though the platforms withhold the cash they should be making, because the alternative is they get no cash.
Why do you think 40% commission (as per that real world Chinese example) plus 10% service charge can't be profitable?
Why? Because those figures are wrong. Their total charge is more like 30% including the service charge depending on the area. If someone is being ripped at 50% then they quit and use one of the competitors.
I'm going to park this because you aren't paying any attention. It isn't what I think. It is what their investors know. The investors who see the real figures not your best guess figures.
Please, go buy shares in Deliveroo as you are so convinced they are a winner. They are a bargain at the moment having lost 60% of their value since the start of the year.
I never said Deliveroo are a bargain at the minute, I said they have the potential of being profitable. That is two very different things. There is a world of difference between profitable and to infinite and beyond stock prices.
Do I think Deliveroo can make a profit in the future? Yes.
Do I think they will make a profit that justifies a £1.5 billion market cap? Let alone a nearly £4 billion market cap earlier this year? No, that's a very different question.
The investors who see the figures also think they can make a profit in the future, otherwise the share price would be 0.
The value they have, is in the brand itself. The underlying business is unlikely to ever be profitable.
Why don't you think they can make a profit charging 30-40% commission plus service charges, while only paying a pittance to the people delivering for them who are expected to do many deliveries per hour to get to £9 per hour?
Whether restaurants will make money with Deliveroo etc charging 30%+ commission is another matter.
For some reason Rochdale seems to think the fact that every FoodCo is on every DeliveryCo network now is bad news for the DeliveryCo's, it isn't. The fact that FoodCo feels they have no choice but to be on every network is precisely why they are and means DeliveryCo can charge exorbitant commissions and they get away with it.
The issue is, that the many DeliveryCos have massive marketing costs, as they are competing with each other, and still can’t make close to a profit while they have humans doing the deliveries, despite the commissions they charge to restaurants.
You and I agree on most things, but @RochdalePioneers is right on this one. Unless we can get the robot overlords doing deliveries.
Absolutely marketing etc is a major cost and would remain a major cost even if they replaced all humans with robots.
Considering how shit these companies treat the drivers delivering for them, I'm not convinced robotics would make the businesses any more profitable. Robots would come with their own costs too and marketing would remain an issue. Robot drivers is vapourware to scam investors not the magic cure to make the business profitable.
Ocado are are a tech company that sell groceries as a sideline. The grocery operation is really a demonstration of their robot fulfilment centre tech business.
Which is fine. Until the robot sets on fire. And burns down the entire facility...
You keep seeming to look at this from the perspective of the dark kitchen though, rather than from the perspective of Deliveroo. I never claimed the dark kitchen would be profitable, did I?
You claimed that the commission was "a reduction in their profits" which for the dark kitchen is 100% true, but for Deliveroo it isn't, it is their revenue stream. The service charge they then charge the consumer is also a revenue stream for Deliveroo, so they have multiple revenue streams.
Whether their revenue exceeds their costs is a different question, but their service charges are categorically not their only revenue stream.
PS I think anyone setting up a "dark kitchen" its a mug's game. Deliveroo are keen to get people setting them up, because they can then charge money for it but if you're not selling drinks etc to consumers then its going to be very difficult for anyone operating a dark kitchen to turn a profit while paying Deliveroo etc too.
But Deliveroo don't care if the restaurants they 'serve' go bust and are replaced by new investors looking to set up a restaurant. That's another injection of investment cash going on right there, without Deliveroo needing to raise a penny of it, instead they're parasites on that.
You mentioned Dominos originally. Could be a Dominos franchise. Or a chippy. Or Tesco Express - whatever. Those guys make money producing stuff.
Deliveroo are an order processing and delivery company. They make money generating and delivering orders.
The problem is that for the food producer they can't just use Deliveroo. Or Gorillas. Or Ubereats. They need to use all of them. And don't care which. Punters increasingly use umbrella sites like Just Eat rather than Deliveroo as there is more choice.
So the producer makes money producing stuff. The delivery firm makes money via tech and physical; delivery. And that is the problem. They cannot make money unless the tech is established and the volume is enormous. Their commission does not cover their costs and they can't charge more commission because competition lowers the bar - nobody cares who delivers the food.
So yes, Deliveroo do care. They only get volume if the restaurant keeps using them. And there is too much competition. Hence the new idea of Deliveroo operating their own dark kitchen -they can't lose the custom and there is actual profit that can be used to subsidise their losses.
You're wrong in saying the producer makes money producing stuff. The producer should make money producing stuff, but the problem is the producer is having a large slice of their ticket price they should be making on being withheld by Deliveroo etc instead.
And all the hundreds of FoodCo's in your local area feel like they have no choice to be on all platforms, even though the platforms withhold the cash they should be making, because the alternative is they get no cash.
Why do you think 40% commission (as per that real world Chinese example) plus 10% service charge can't be profitable?
Why? Because those figures are wrong. Their total charge is more like 30% including the service charge depending on the area. If someone is being ripped at 50% then they quit and use one of the competitors.
I'm going to park this because you aren't paying any attention. It isn't what I think. It is what their investors know. The investors who see the real figures not your best guess figures.
Please, go buy shares in Deliveroo as you are so convinced they are a winner. They are a bargain at the moment having lost 60% of their value since the start of the year.
I never said Deliveroo are a bargain at the minute, I said they have the potential of being profitable. That is two very different things. There is a world of difference between profitable and to infinite and beyond stock prices.
Do I think Deliveroo can make a profit in the future? Yes.
Do I think they will make a profit that justifies a £1.5 billion market cap? Let alone a nearly £4 billion market cap earlier this year? No, that's a very different question.
The investors who see the figures also think they can make a profit in the future, otherwise the share price would be 0.
The value they have, is in the brand itself. The underlying business is unlikely to ever be profitable.
Why don't you think they can make a profit charging 30-40% commission plus service charges, while only paying a pittance to the people delivering for them who are expected to do many deliveries per hour to get to £9 per hour?
Whether restaurants will make money with Deliveroo etc charging 30%+ commission is another matter.
For some reason Rochdale seems to think the fact that every FoodCo is on every DeliveryCo network now is bad news for the DeliveryCo's, it isn't. The fact that FoodCo feels they have no choice but to be on every network is precisely why they are and means DeliveryCo can charge exorbitant commissions and they get away with it.
Genuinely giggling reading this. Its another subject where you are taking your theoretical ideas disconnected from the real world and proceed to lecture the industry on how they are wrong. Bravo.
That last line in particular - genius. Having just spent half an hour reading how all the competitors are undercutting each other to fight for market share you are still saying they can "charge exorbitant commissions and [] get away with it"
As they lose money on each delivery - on their own figures - they are hardly exorbitant. And the market competition means that can't and DON'T get away with it. Why stick with Deliveroo if Gorillas are cheaper? Or why bother with any of them at all when you can use Just Eat and not care who does the delivery?
Please, you should do a Ted talk on it. Tell Deliveroo how they have got their industry wrong. We could watch. I'd pay!
LOL. You're the one claiming they got their industry wrong. I'm saying they haven't!! 🤦♂️
And why stick with Deliveroo if Gorillas are cheaper? Because the customers are using Deliveroo, so it doesn't matter if Gorillas charge less commission, as a "dark kitchen" or a restaurant you're obliged to sign up to Deliveroo whether you want it or not if you want them to bring you their customers.
That is why so many businesses are now hooked on using all of the major delivery apps.
The London media bubble tosspots have got this one wrong. They are probably helping him.
Aside from the fact that £50 divided by 170 meals is just under 30p per meal, not 30p per day.. Other than the bad maths, I agree with him.
Its always cheaper to make bulk food than small quantities. 170 meals is a stupid thing to quote as the per meal cost will be a lot more if you are making a week's worth of meals for yourself instead of meals for 170 people to eat immediately.
He doesn't get it, but his "I did not patronise you" response is itself patronising.
And batch cooking, great as it is, does depend on having a large fridge, preferably a large freezer. Which in turn means having the space to put it in.
Once again- one trouble with being poor is that it makes things so expensive.
You keep seeming to look at this from the perspective of the dark kitchen though, rather than from the perspective of Deliveroo. I never claimed the dark kitchen would be profitable, did I?
You claimed that the commission was "a reduction in their profits" which for the dark kitchen is 100% true, but for Deliveroo it isn't, it is their revenue stream. The service charge they then charge the consumer is also a revenue stream for Deliveroo, so they have multiple revenue streams.
Whether their revenue exceeds their costs is a different question, but their service charges are categorically not their only revenue stream.
PS I think anyone setting up a "dark kitchen" its a mug's game. Deliveroo are keen to get people setting them up, because they can then charge money for it but if you're not selling drinks etc to consumers then its going to be very difficult for anyone operating a dark kitchen to turn a profit while paying Deliveroo etc too.
But Deliveroo don't care if the restaurants they 'serve' go bust and are replaced by new investors looking to set up a restaurant. That's another injection of investment cash going on right there, without Deliveroo needing to raise a penny of it, instead they're parasites on that.
You mentioned Dominos originally. Could be a Dominos franchise. Or a chippy. Or Tesco Express - whatever. Those guys make money producing stuff.
Deliveroo are an order processing and delivery company. They make money generating and delivering orders.
The problem is that for the food producer they can't just use Deliveroo. Or Gorillas. Or Ubereats. They need to use all of them. And don't care which. Punters increasingly use umbrella sites like Just Eat rather than Deliveroo as there is more choice.
So the producer makes money producing stuff. The delivery firm makes money via tech and physical; delivery. And that is the problem. They cannot make money unless the tech is established and the volume is enormous. Their commission does not cover their costs and they can't charge more commission because competition lowers the bar - nobody cares who delivers the food.
So yes, Deliveroo do care. They only get volume if the restaurant keeps using them. And there is too much competition. Hence the new idea of Deliveroo operating their own dark kitchen -they can't lose the custom and there is actual profit that can be used to subsidise their losses.
You're wrong in saying the producer makes money producing stuff. The producer should make money producing stuff, but the problem is the producer is having a large slice of their ticket price they should be making on being withheld by Deliveroo etc instead.
And all the hundreds of FoodCo's in your local area feel like they have no choice to be on all platforms, even though the platforms withhold the cash they should be making, because the alternative is they get no cash.
Why do you think 40% commission (as per that real world Chinese example) plus 10% service charge can't be profitable?
Why? Because those figures are wrong. Their total charge is more like 30% including the service charge depending on the area. If someone is being ripped at 50% then they quit and use one of the competitors.
I'm going to park this because you aren't paying any attention. It isn't what I think. It is what their investors know. The investors who see the real figures not your best guess figures.
Please, go buy shares in Deliveroo as you are so convinced they are a winner. They are a bargain at the moment having lost 60% of their value since the start of the year.
I never said Deliveroo are a bargain at the minute, I said they have the potential of being profitable. That is two very different things. There is a world of difference between profitable and to infinite and beyond stock prices.
Do I think Deliveroo can make a profit in the future? Yes.
Do I think they will make a profit that justifies a £1.5 billion market cap? Let alone a nearly £4 billion market cap earlier this year? No, that's a very different question.
The investors who see the figures also think they can make a profit in the future, otherwise the share price would be 0.
The value they have, is in the brand itself. The underlying business is unlikely to ever be profitable.
Why don't you think they can make a profit charging 30-40% commission plus service charges, while only paying a pittance to the people delivering for them who are expected to do many deliveries per hour to get to £9 per hour?
Whether restaurants will make money with Deliveroo etc charging 30%+ commission is another matter.
For some reason Rochdale seems to think the fact that every FoodCo is on every DeliveryCo network now is bad news for the DeliveryCo's, it isn't. The fact that FoodCo feels they have no choice but to be on every network is precisely why they are and means DeliveryCo can charge exorbitant commissions and they get away with it.
The issue is, that the many DeliveryCos have massive marketing costs, as they are competing with each other, and still can’t make close to a profit while they have humans doing the deliveries, despite the commissions they charge to restaurants.
You and I agree on most things, but @RochdalePioneers is right on this one. Unless we can get the robot overlords doing deliveries.
Absolutely marketing etc is a major cost and would remain a major cost even if they replaced all humans with robots.
Considering how shit these companies treat the drivers delivering for them, I'm not convinced robotics would make the businesses any more profitable. Robots would come with their own costs too and marketing would remain an issue. Robot drivers is vapourware to scam investors not the magic cure to make the business profitable.
Oh, there’s no chance whatsoever of robots doing deliveries anytime soon, other than well-supervised and rediculously expensive prototype demonstrations.
Thanks to the ending of FoM, and full employment, it’s becoming more expensive for these companies to exploit cheap labour at the bottom end. The apps are all struggling to recruit drivers, and are paying higher rates which erodes their own margins, which makes them even less likely to be profitable in the medium term.
The London media bubble tosspots have got this one wrong. They are probably helping him.
Aside from the fact that £50 divided by 170 meals is just under 30p per meal, not 30p per day.. Other than the bad maths, I agree with him.
Its always cheaper to make bulk food than small quantities. 170 meals is a stupid thing to quote as the per meal cost will be a lot more if you are making a week's worth of meals for yourself instead of meals for 170 people to eat immediately.
He doesn't get it, but his "I did not patronise you" response is itself patronising.
And batch cooking, great as it is, does depend on having a large fridge, preferably a large freezer. Which in turn means having the space to put it in.
Once again- one trouble with being poor is that it makes things so expensive.
Yep. i have a small flat in London (which I love, as its location is brilliant and it’s easy to maintain). No room for a proper freezer tho. Which sometimes really frustrates me
The media bubble tosspots have got this one wrong. They are probably helping him.
Making those comments in the Queens speech debate during a cost of living crisis re not been able to budget and not being able to cook is an epic fail . The video isn’t going to repair that damage , most think he’s an out of touch twat who happily raked in the expenses.
IIt seems that pretty much everyone agrees with him about the need for budgeting and cooking skills. And even the Daily Mirror has been writing articles about it.
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Ukrainians will remember this for a century. Russia is soiling itself in front of the world
Driving
Ladders
Cycling
Chopping wood
Skiing
All stuff I do a lot of
I have apparently been a naughty boy with some of the stuff I have been doing in the last week, but have got away with it.
I do love reverse mnemonics though, gonna publish a book of them. BronZe has Zinc in it. Pouilly Fuisse vs Pouilly Fume? Pouilly FuiSSe is the Sauvignon one, obv. etc.
UC in arrears, but the ability to get money up-front if you need it (which has been the case for years now) is less of a barrier to people signing off than UC up-front is.
The Deliveroo Editions site at Cranford Way, north London, sits at the back of an electricity substation, sandwiched between a boxing gym on one side and some overgrown scrub on the other... Other Deliveroo Editions sites in the UK can be found at the back of industrial estates or below traffic flyovers. They typically consist of up to 16 metal boxes roughly the size of shipping containers, packed on to a patch of asphalt with generators humming in between... From here, offerings from Pizza Express, Shake Shack and “Cluckleberry Finn Fried Chicken” – a delivery-only outfit that you won’t find anywhere outside Deliveroo’s app – are pumped out into the city...
“Dark kitchens” are places where meals are prepared entirely for delivery... the idea of gearing them towards home takeaways is relatively recent. It’s a leap that has only been made possible by the rise of food delivery platforms, and the global leader of the concept is Deliveroo, which opened its first dark kitchen in London in 2016. Today, the company boasts 250 in eight countries, each of them home to a fluid array of tenants, including international chain restaurants, tentative startups and virtual brands, some of which might “exist” on the app for just a few weeks.
To many, the notion of a whole host of different cuisines emerging from the same kitchen – with a chef simultaneously preparing a pizza on one work surface and a Sichuan hot pot on another – feels unsettling, but it reflects the logic of the abstracted digital marketplace; the New Yorker recently described dark kitchens as “the culinary equivalent of a multicolour retractable pen”. To make a success of the operation you need to know what colour to push and that’s where Deliveroo’s vast stores of data come to the fore. “Using our own technology, we can identify specific local cuisines missing in an area, identify customer demand for that missing cuisine and handpick brands that are most likely to appeal to customers in that area,” Deliveroo’s former property acquisitions manager, Patrick Weiss, speaking in 2017,has said.
As the firm’s prospectus for its flotation reveals, Editions lie at the heart of Deliveroo’s vision of the future and its plan to win the delivery-app wars. “With unparalleled global expertise, we are uniquely positioned to scale this concept,” the company claims, and many investors agree. “Deliveroo already has a great database of consumer preferences,” says Ioannis Pontikis, an equity analyst for the financial services firm Morningstar. “And once you’ve set up a dark kitchen, it’s very easy to trial new brand ideas, new food concepts, new marketing and promotions.” Pontikis points out that dark kitchens don’t only have an edge over bricks-and-mortar restaurants when it comes to generating demand: they also benefit from better unit economics – ie a lower cost for each meal produced.
As @BartholomewRoberts also points out, the relationship between Deliveroo and the restaurant is not exactly favourable to the latter either. They’re taking commission from both sides, but still can’t make a profit.
The ringroad and Astley Bridge ASDA (scene of the "heavy duty black bin bags" song) marks the real boundary.
Labour Bolton results were poor.
You can apply for it. But no one tells you you can.
He can afford a personal trainer and a personal gym, yet he’s dangerously obese. There must be an actuarial risk he won’t make it in total health to 2024
Again, Deliveroo Do Not Make Money From Producing Food.
There is a service charge that gets made against the producing restaurant / take-away / dark kitchen. That is a cost of business, it isn't a cut from their profits, its a reduction in their profits.
If you are Dominos or even your local curry house, you may pay a similar cost of getting deliveries out. But you profit from the food. So it doesn't matter if the delivery operation loses money as long as you are up overall.
What you are missing is that the model for delivery only - like Deliveroo - does not work without regular injections of cash. Even with the revenue stream of taking a % from food producers they lose £1 per delivery (Deliveroo figures) - the more they grow the more £ they lose. The reason why share prices are tanking with all of these businesses is that investors are starting to ask questions about how the business makes money and don't like the answers.
Bethany Black twitch.tv/beffernieblack
@BeffernieBlack
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I would like to apologise to the Tory party, I was wrong, after your ability to organise piss ups and get laid in brothels I thought I had the analogy down, but it turns out you *could* organise a buffet in a food bank.
Plus since Deliveroo are taking not just the £5 from the delivery fees but they're also charging a commission on the sale which you never see in your own bill, they're actually raking in more cash than the cabbie is.
When Just-Eat started they typically offered consumers "free delivery" and just charged the commission to the restaurants. Now they'd doing both, taking two bites of the cherry charging the customers and charging the restaurants too, its certainly plausible that they'll make a profit in the future.
What's less plausible is that they'll ever be a good employer. Or probably even that good for the hospitality industry either as a whole who are getting their profits cannibalised by these companies grabbing a chunk of the revenue.
Its a reduction in profits for the kitchen. It is Deliveroo taking those profits though.
If Deliveroo take £12 commission and £5 in service charges on a £40 order then pays a driver £3 to deliver that order - do you really think there's no plausible way they can make a profit on that?
Whether the hospitality industry can make money when these companies are taking the profits is a different question.
That was my first ever car ride.
With decades of hindsight, my name probably was on the list but mispronounced so badly that I did not recognise it. After a lifetime of having my name misspelled and mispronounced, it is at worst a minor irritant and I am sceptical of claims that this is micro-racism in action. One good point of an unusual name is that there is no _20796 in my email address.
Norwich Tories are VERY shy Tories
Edit - I've even seen a Change UK poster........
Because of the marketing and IT costs of the delivery company, and the fact that the driver needs to do a return trip.
@DecrepiterJohnL would be way better off, as would his local chippy, if he called the chippy to place an order, then called the local minicab company to pick it up.
The delivery apps can’t ever make a profit, because there’s a limit to what consumers will pay for delivery, and a limit to how much restaurants are willing to get ripped off by the apps. There’s high price elasticity of demand, as an economist might say.
Even worse, there’s the next high-spending, VC-funded app just around the corner, ready to take that market share just as you try and work out how to make delivery profitable.
The ‘dark kitchens’ might turn a profit by themselves, as they’re in cheap industrial areas but can charge rents that only need to be a little lower than the town centre rents the restaurants are used to paying.
That's a long way from the 5 week wait having been "abolished years ago".
This was in 2019 so maybe things have changed since then.
Good news on the fracture, hope it all goes well.
I don't agree that there's high price elasticity of demand, people will pay for convenience. If they weren't willing to do so, they'd be cooking themselves, and so people will pay more for getting food delivered. These companies have been very sneaky getting customers hooked not charging for delivery and just charging commission - lately they're whacking up prices they charge customers while still charging commission and they're not losing all their customers over it.
The chippy would be better off taking 100% of the cash instead of Deliveroo taking a slice of it, but there's no reason Deliveroo can't make money when simultaneously both charging commission AND charging delivery fees.
Whether the kitchens turn a profit is another question. A lot of restauranteurs find they do a lot of work without much if any reward.
The issue isn't what you or I think about profitability. The issue is what their investors think. They are now asking very direct questions about their ability to ever make money and don't like the non-answers being given.
Here is reality. If DeliverCo was the only operator, and could get the technology side of the business stable so that it becomes an operating cost not a developer cost, and it could charge what it needed, then perhaps it can make money. The only way both the delivery companies and the dark kitchen operators make money is scale.
The problem is that there isn't just DeliverCo. Half a dozen competitors have sprung up, all with their own set-up and marketing costs, all without the scale to turn an operating loss into an operating profit.
The end game is to out grow the competitors who fail and leave the field open to only you. But that isn't happening, and the projected volume growth to infinity isn't there. So huge amounts of cash being burnt and only losses to show.
It's often shorter. Sometimes longer if your circumstances are complex. A lot of that often around possession of the required photo ID and access to uploading it.
Of course. Those who need it the most tend to be in the most complex and chaotic circumstances.
Having said all that. UC is, in the round, a much better system than what it replaced.
A single payment, and the ability to leave and receive messages Online with a named contact being two of them.
You claimed that the commission was "a reduction in their profits" which for the dark kitchen is 100% true, but for Deliveroo it isn't, it is their revenue stream. The service charge they then charge the consumer is also a revenue stream for Deliveroo, so they have multiple revenue streams.
Whether their revenue exceeds their costs is a different question, but their service charges are categorically not their only revenue stream.
PS I think anyone setting up a "dark kitchen" its a mug's game. Deliveroo are keen to get people setting them up, because they can then charge money for it but if you're not selling drinks etc to consumers then its going to be very difficult for anyone operating a dark kitchen to turn a profit while paying Deliveroo etc too.
But Deliveroo don't care if the restaurants they 'serve' go bust and are replaced by new investors looking to set up a restaurant. That's another injection of investment cash going on right there, without Deliveroo needing to raise a penny of it, instead they're parasites on that.
1 Reach - partner with us and we will bring you custom for which we'll take a commission
2 Tech - we will put your food on our platform and show you analytics as to who buys what so you can optimise your menu
3 Cost - we will be competitively priced for our service
There is a fundamental problem. With the various operators all competing with DeliverCo the only way to operate is use ALL platforms whether they be Gorillas or Ubereats or Deliveroo or whatever. Because you're cross platform you're now using one of the takeaway platform operators like JustEat, so it is THEIR data that matters. And cost will always be too high with competing companies vying for business.
What BR has missed is that most punters and most food producers have no interest which delivery firm is turning up. They don't even manage that side of things. To give you my live example take a dark kitchen facility in that London. 30 separate producers in the facility with 50 dufferent menus on Just East etc.
People go online to Just Eat and choose what they want. Kitchen receives the order, makes the food, hands it over to the facility team who hand over to the DeliverCo person. There isn't even a choice being made about Ubereats vs Deliveroo vs whoever - their business is literally to deliver and only to deliver an order being run by someone else...
In a number of continental countries there are considerably higher protection for *some* parts of the workforce. In effect, there are higher costs for employment. So getting a job is harder.
So many come here, because jobs can be created easily.
DeliverCo can take a slice of what should be FoodCo's profits. That doesn't make FoodCo profitable, but it can make DeliverCo profitable.
Your someone else does the work while DeliverCo takes the margin in commission ...
Con 8,163
Lab 8,136
LD 5,824
Green 1,247
Reform UK 595
No wonder the shop is keen, but the shop is desperate for cash and so feel they have no alternative to be on Deliveroo's platform.
Why people think Deliveroo has no possibility of being profitable when they parasitically take 40% of the ticket price and a service charge on top is beyond me. Yes they're not doing "the real work" but parasites don't need to.
In any case, I was just taking issue with your claim that "nobody tells you about it" - from my own experience that wasn't true, and the overall process wasn't unreasonably slow. Also, once the advance was approved it was paid immediately.
https://www.facebook.com/LeeAndersoninAshfieldEastwood/posts/526766122455321
This is the video linked, from last November. Quite interesting.
https://www.youtube.com/watch?v=xt8fEcV-zXA
The London media bubble tosspots have got this one wrong. They are probably helping him.
They're taking the cash while not doing the work, that can be a profitable business model, if you can get customers sticking with you and make the people who do the real work feel they have no alternative but to use you - its parasitical but it can work.
https://www.standard.co.uk/news/london/i-didn-t-call-boris-johnson-a-fat-b-says-cyclist-labelled-gollum-by-the-mayor-8746301.html
Probably mainly flat, though.
I bet he's livid.
When I make bolognese sauce, I do it in a large batch - doesn't really work for small amounts. I freeze it using silicon molds (soap molds, actually).
The other thing that seems lost is the idea of having a couple of dishes in the fridge that are cooked, and you reheat a portion for a quick meal.
While neither of these is the answer to all cooking time issues, they are useful.
For all the thin people out there who have to watch what the eat, and exercise to stay slim there are others who are naturally prone to NOT get fat. My wife is one such. Her appetite regulates itself. When she is hungry, she eats, When she is not, she doesn't. Not hungry and the plate of biscuits will not be touched.
I'm different. I can eat whenever, hungry or not. I have a constant losing battle with weight. I exercise, not as much as I used to but age and annoying injuries get in the way. Take a picture of me and you will see an overweight 49 year old. Have I no will power? Or have I been dealt a different metabolism which responds in different ways to yours?
Fat shaming should not be acceptable.
There is enough to go after Johnson for - policies, lies, partygate, whatever. But having a pop at someone ACTUALLY TAKING EXERCISE is the lowest form of abuse.
Daily Octordle #108
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octordle.com
It's an example of how careful MPs have to be in today's gotcha media climate, but it probably will have damaged him - most people won't watch the video or read his detailed comments.
Anderson should have just said my local food bank does batch cooking , take a look at my video . His comments just came across badly as they seemed patronizing and judgemental.
He doesn't get it, but his "I did not patronise you" response is itself patronising.
So when defrosting, you can do stuff like put them in a sauce pot with a barely running burner under it - defrost in about 5 minutes....
That's why the media are seen by many as extremely unpleasant human beings
Really?
Shame can be quite a motivator. One of the reasons French, Italian and Japanese people don’t get as fat as Brits, Yanks, etc, is because it is seen as shameful to let yourself go to that extent. You must present the bella figura
We could do with some of that shame. The state of some Brits out here in Greece/Turkey. Jesus FC. Go on a fucking diet you grotesque blob
The answer I think he is pointing to is that it would be more efficient for a centralized provider to offer people meals, making them free to those on low incomes. Perhaps they could do this in... oh I don't know... schools?
Once again- one trouble with being poor is that it makes things so expensive.
AFAICS the headlines Mike has quoted do not reflect what was said. Here's the speech - care to show me where I missed something?
https://hansard.parliament.uk/Commons/2022-05-11/debates/9711762D-D7FB-4A83-B43D-20F89F7A5DC7/details#contribution-ADBFBC80-4584-4940-977D-E684A99C9CF7
The Expenses point is pretty vapid, since 90-95% of it is office accommodation and staff wages.
On the politics, I don't see how burblings in the London Media bubble will make much difference to the next Election in Ashfield.
@BlancheLivermore
>Aside from the fact that £50 divided by 170 meals is just under 30p per meal, not 30p per day.. Other than the bad maths, I agree with him.
Media misquotes, either through mistakes or because it helps the storyline. Standard practice for UK media. This is the quote from Hansard:
We show them how to cook cheap and nutritious meals on a budget; we can make a meal for about 30p a day, and this is cooking from scratch.
Edit: or 1 30p meal a day.