Everyone knows Uber today. This amazing breakthrough brings many changes to people’s lifestyle. Firstly found as a versatile app that specialized in ride-hailing, Uber spreads its wings into many other aspects with a similar concept known as Uber Eats. This application allows the user to order foods from various food businesses. In short, the user can get desired food without even leaving their seat.
However, Uber Eats offers you more; you can make money from it.
So, how does Uber Eats make money?
Finding out how Uber Eats make money should be started by knowing how it works. Generally, Uber Eats works similarly to the other food delivery business. It consists of 4 main components including customer with restricted menu set, a customer with the real-time order, courier partners and restaurant partners. The customers will order to the nearest and reachable driver to deliver food from restaurant partners. Uber will charge higher prices for the delivery service.
How Does Uber Eats Make Money in Instant Way?
Joining Uber Eats has been chosen as an instant and easy way to make money, both for driver and partner restaurant. For the driver, simply by registering yourself as courier partner or driver, you will be the part of the delivery network as Uber Eats driver. Your order depends on the proximity and location to your customer. From the restaurant partner side, they need to submit a specific form containing details about restaurant and Uber Eats will approve later. Then, how does Uber Eats make money?
1. Delivery fee from Uber Eats customers
As aforementioned, customer is one of the main components to build Uber Eats business. The customers will order food from desired restaurants and the driver will deliver. Whenever the customers are, they have to pay a fee to Uber. The fee is flat, no matter order size the customer asks. However, it should meet order limit that starts from $5 in the US—different country might apply different policy for order limit.
How does Uber Eats make money from customer’s order? For your information, there is surge pricing whenever you order food from Uber Eats, especially at certain periods. Lunch and dinner are typically peak hours that charge surge pricing. The surcharges applied because some restaurants refused to serve during these times.
2. Rev-Share from restaurant
It is quite complicated to explain how the income comes to Uber Eats from restaurant partners. When it comes to partnership, both sides should be able to gain benefit. In this case, Uber Eats will get rev-share from the restaurant while the restaurant will reach their customers in a much easier way. How does Uber Eats make money from rev-share? It is easier to explain by example.
Let’s say ‘A’ orders food from restaurant ‘B’ via Uber Eats. The food costs $50, with additional $5 as a convenience fee. The order will be delivered by C. In this case, A should pay $55 and restaurant partner will get 30% for the commission, which is $35. Meanwhile, the driver will get pick up revenue plus delivery revenue and mile charge. Let’s say C gets $12. So, Uber Eats will get $8 as the result of $55-$35-$12. From this illustration, it is quite obvious that Uber Eats gets a lot of money from the business.
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In conclusion, Uber Eats is another breakthrough in business and marketing strategy.
How does Uber Eats make money effectively?
It cannot be separated from the main components it has. Considering the convenience offered to the customers, it is not surprising to know Uber Eats spreads widely in short time. However, with the ability to make money in such easy way, Uber Eats should be ready to welcome other competitors that might be attracted to gain benefits as it does. (gk)