Grubhub: the future is restaurant chains
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Grubhub: the future is restaurant chains

According to food order and delivery market leader, restaurant chain partnerships are going to be a big part of its business in the coming year. The company told reporters recently that the success it’s garnered from its partnership with Yum Brands so far will work as a model that it hopes to roll out to other restaurant chains that could benefit from its services.

Grubhub’s share price has risen by 10% so far this year

19 02 GrubHubgraph

Source: Yahoo Finance

A year ago, Yum Brands invested $200 million in Grubhub, and the companies have been working in partnership ever since. That means that Yum Brands’ numerous restaurant chains (Taco Bell, KFC, and others) have evolved deep integration with Grubhub’s services, as the latter becomes their exclusive delivery partner. From Grubhub’s perspective, of course, this is a golden ticket: these fast-food chains bring a huge amount of business to the table, and as long as Grubhub continues to deliver a first-rate service, it doesn’t have to compete for that business.

On a call a few weeks ago, Grubhub’s CEO, Matt Maloney, said: “We are excited about the Yum partnership as it’s a source of growth but also as a model of how we partner with enterprise restaurants across the country.” Next on his itinerary, though, is bringing another of Yum’s businesses into the fold: Pizza Hut.

According to Maloney, Grubhub offers more than just a delivery driver: the company is facilitating back-end tech for ordering, apps and loyalty programs. He said: “We’re fundamentally executing core technology for brands. We’re helping with transaction management. We’re doing delivery from the applications. We’re doing point-of-sale integration, and [customer-relationship management] tools, including loyalty.”

The company currently has more than 25,000 enterprise restaurants on its platform.

Disclosure

Dominion holds Grubhub in its Global Trends Ecommerce Fund.


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