Uber Agreed to Acquire Postmates

The boom in eating in has spurred orders and sales in the nation’s nascent food delivery industry, as thousands seek to recreate the experience of eating at their favorite restaurant at home.

Thus, it is no surprise that the industry, which is still in its infancy, is seeing more consolidation as Uber Technologies announced on Monday its intention to purchase Postmates, a rival food delivery service. Uber sees the two companies as complementary in terms of both their geographic focus and their relationships with foodservice providers.

The transaction will boost the size of Uber’s Uber Eats business, which has been seeing exponential growth – in contrast to simultaneous sharp declines in the company's flagship ride-hailing unit, as stay-at-home orders and sharp reductions in travel for business and pleasure suppress the need for widespread transportation. It will also help position the company as a leading provider of “convenience services” ranging from rides, the delivery of meals and freight, and the provision of other needed services. As many US consumers continue to limit their trips out as coronavirus remains a threat to public health, more and more companies will look to bolster their presence in this segment of the economy.

According to The Freedonia Group’s National Online Consumer Survey conducted in May 2020, 30% of adults note that they are using restaurant delivery more because of the coronavirus pandemic and 51% note that they are using restaurant curb-side pick-up options more.

For more information and discussion of opportunities, see The Freedonia Group’s extensive collection of off-the-shelf research, including new reports on Global Foodservice and Global Foodservice Single-Use Products. Additional information is also available in food reports available from The Freedonia Group’s sister publisher Packaged Facts, including Food Carryout & Delivery, Food Carryout & Delivery: Special COVID-19 Consumer Insights, and Food Market Outlook 2020: Home Cooking & Grocery Shopping in the Age of Coronavirus. Freedonia Custom Research is also available for questions requiring tailored market intelligence