Is "food delivery" 🛵 really a sustainable business model?

And we’re not even getting into how these businesses structure their costs—especially when it comes to their relationship with "riders", the vast sums invested in technology, or the margins they operate on, despite charging restaurants an average commission of around 30% and adding a delivery fee for customers.

No, that’s not what we mean. We’re talking about business sustainability from a customer experience perspective. And here’s what these platforms fail to explain:

a) The number of people using these apps continues to grow every day. We have become accustomed to the convenience they offer. We may criticise them in certain circles—because of how they treat their workers or for other reasons—but, in the end, we still use them.

b) As consumers, we are creatures of habit, and demand tends to concentrate around the same moments: lunchtime, the evenings before public holidays, weekends, or major televised events. In other words, these platforms face highly critical demand peaks.

c) Their business relies, of course, on users eager to receive their orders. But it also depends on the network of restaurants and retailers that actually prepare or sell the products people want. And that network is finite; it cannot grow exponentially.

d) Geographic expansion may seem like an obvious growth opportunity for the platform, but it makes little difference to the individual user. Their needs must be met quickly, which inevitably limits the effective delivery radius of the establishments capable of fulfilling each order.

e) Most of the businesses serving this demand were not originally designed to operate as fully online businesses. They are primarily customer-facing establishments with their own in-store workflows and footfall. Expanding their capacity is far from simple, due to space constraints, the investment required and the unpredictable nature of online demand.

f) On top of this, public authorities often introduce restrictions—sometimes more effectively than others—to limit the rise of ghost businesses: operations with no real street-facing activity, created specifically for this new service model. This is particularly evident in the restaurant sector.

And where does all this lead? To a deterioration in the customer experience—not only for delivery users, but also for customers visiting the establishment in person when operations become overwhelmed. As a result, a service designed to make life easier can end up losing much of its value.

Let’s look at two simple examples:

Friday night, 9 p.m. A family places a €65 order with a restaurant—the classic Friday-night dinner when no one feels like cooking. The order goes through correctly via a food delivery app, payment is taken and the restaurant starts preparing it. So far, everything seems perfectly normal. But then comes the surprise: with just ten minutes to go before the expected delivery time—and 40 minutes after placing the order—a message appears saying:

"Your order has been cancelled by the restaurant because it is currently unable to fulfil it. We’re sorry for the inconvenience. You will receive a full refund, and we’d also like to offer you a €2 voucher to use on a future order through our app".

And that’s it... Dinner is off. After 40 minutes of waiting, the compensation does not even amount to 4% of the order value—and, in the customer’s mind, it is the restaurant that has failed.

Saturday night, 8:45 p.m. The Champions League final is on—yes, one of those peak-demand moments. You open the app and start looking for somewhere to order dinner from… only to discover that not a single restaurant is available. Every single one has stopped taking orders or is only offering delivery slots for the following day.

https://video.wixstatic.com/video/a26f4e_c5454470d26e460d87c51d9a55bf9e67/360p/mp4/file.mp4

Another fail. You are left with the feeling that the app cannot meet what should be a very simple need—because demand has exceeded its capacity. In other words, it has become a victim of its own success.

These are just two simple examples—and, of course, there are many other occasions when these services work perfectly well. But as the platforms continue to grow, the structural issues outlined at the beginning of this post remain unresolved. And that means situations like these are likely to become increasingly common for users.

And that is what ultimately creates a scorched-earth effect: users lose trust and stop using the apps altogether.

Is there a solution? There is no easy fix, but a few possible approaches could be:

-Stop focusing solely on volume and start prioritising margin—even if that means charging users more for the service. Higher prices would encourage more considered use and reduce the pressure on these companies to pursue endless growth at all costs.

-Restaurants and retailers need to take an honest look at whether they are genuinely equipped to play in this league. The opportunity is tempting, particularly because it can help fill quieter periods, but it also comes with operational demands that not every business is ready to meet. If only those establishments that fully understand what the model involves—and have the capacity to deliver the service properly—choose to participate, customer frustration would be reduced and demand would naturally become more balanced.

-Public authorities also need to understand this new business model and support the creation of dedicated establishments capable of meeting this demand through well-designed regulation—for example, by granting specific licences in designated areas and setting clear operational requirements.

-As consumers, we also need to accept that “here and now” has its limits. That may mean planning deliveries further in advance, accepting that orders could come from farther away—although the challenge of ensuring the food still arrives in good condition remains—or simply recognising that not everything needs to be ordered online.

Otherwise, we risk becoming trapped in an endless downward spiral—one that ultimately creates a scorched-earth effect for everyone involved: consumers, restaurants and retailers, and the platforms themselves.

Dying from a lack of customers is no worse than becoming a victim of your own success. Either way, the outcome is the same: the business dies.