- Postmates has teamed up with Square to provide delivery capabilities to Square's small, local business partners, many of which are restaurants. Square sellers now have the ability to offer deliveries that can be scheduled and tracked through the Postmates integration, according to a news release.
- The partnership allows restaurants to add-on delivery to any transaction without prior technical experience or an official partnership with Postmates.
- Additionally, Postmates also partnered with Bringg, a delivery orchestration platform used by the likes of restaurants, retailers and grocers, to allow the two platforms to be used simultaneously and integrates both in-house and external delivery fleets to provide joint customers with quicker access to a wider range of delivery options, according to a separate release emailed to Restaurant Dive.
Postmates' latest partnerships, especially the one with square could help level the playing field for retailers and restaurants that simply cannot afford to bring their own delivery aggregate on board or establish their own delivery fleets. Postmates' SVP James Butts outlined the benefits of the Square partnership in the company's press release, stating that it will allow smaller and local businesses to access the delivery company's more than 300,000 drivers without having to hire a developer.
This is a big deal for independent restaurants in the U.S., many of which have lost or will lose market share to bigger chains that have been able to deploy and scale delivery and therefore meet increasing consumer demand. Since 2012, delivery visits are up 10% and sales are up 20%, according to The NPD Group. Morgan Stanley predicts that delivery could account for up to 40% of industry sales by 2020. Players that don't capitalize on this growing demand will struggle to survive in an intensifying environment.
The partnership also offers a benefit for Postmates to get broader exposure. According to CHD Expert, there are about 481,000 independent restaurants in the U.S., versus about 231,000 chain restaurants, or 32% of U.S. restaurants. Not all independents use Square, of course, but those that do will now have an added incentive to do so and optimize their business.
Postmates' Bringg partnership also adds a competitive advantage, allowing chains that use the Bringg platform to add Postmates into their delivery lineup. Restaurants that use Bringg's platform to coordinate their delivery service can now augment that option with Postmates' extensive footprint, optimizing fulfillment during peak hours and expanding delivery coverage in certain areas. Such agility is critical to maintain food quality and a competitive advantage as more concepts jump into the delivery space. And, again for Postmates, the partnership allows for the company to expand its exposure and gain more customers in the process.
Any advantage in this quickly growing space helps, but Postmates is hardly alone in diversifying through other partners. Grubhub, for example, acquired payments and loyalty company LevelUp in 2018.
Despite this competition, however, NPD Group's David Portalatin said there is room for everyone in the space depending on what operators are economically able to do and have sophistication for. Postmates' two new partnerships should make it easier for smaller players to find such room.