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Online food delivery is a natural progression of ride-hailing services like Uber and Lyft that use crowdsourced labor as the delivery provider’s own infrastructure. The pandemic has caused a spike in demand due to health concerns and shelter-in-place. The hiring spree is eye-popping: Instacart announced in April that it’s hiring 300,000 shoppers while Amazon is looking to employ 175,000 new workers for its fulfillment centers and delivery network. Walmart is adding 50,000 people for distribution and FedEx is hiring 35,000 workers.
Entrepreneurs may consider starting a delivery business in their city. Startup costs can be low by using independent contractors and by licensing an appropriate app. Demand is certainly high. If done right, an operator may coordinate with grocery chains and distribution centers to sync systems. Or a small business could integrate with a large company’s IT infrastructure. One option that increases profits is to charge a mark-up for purchased items in addition to shipping fees. Or perhaps certify orders as prepared using stringent health practices to gain new customers.
But what can go wrong? Here are some