Giant transportation company Uber, 2 weeks ago, a food delivery company Grubhub wanted to incorporate, but failed. Still, the incident could not stop Uber's plans to buy a new company and strengthen its own food delivery company, Uber Eats.
UBER plans to buy Postmates, a 9-year-old delivery company, for about $2.6 billion, according to the New York Times and Wall Street Journal. The deal could be announced within days, according to reports. Uber and Postmates have not commented at this time.
Uber's move shows the company wants to become more dominant in the food delivery market. Maybe even a change in business plans. Uber, which started its commercial life as a transportation company, has long served with Uber Eats in food deliveries and many more categories. But after the Coronavirus outbreak, they decided to make a big change in their plans. The closure of people's homes, the inability to use transportation vehicles, has put Uber's business in a lot of trouble. In fact, the giant company had to lay off too many employees early in the pandemic process. But there was something rising inversely proportional to this decline in means of transport. Meeting people's food needs from the outside. Although the pandemic has reduced Uber's business, Uber Eats has seen huge demand in an instant. That's why Uber wants to make the purchase so much. They are aiming to break down their business plans a little more on Uber Eats.
“Our businesses, such as Uber transportation and electric bikes, have suffered a huge decline because people can't get out of their homes, " Uber Chief Executive Dara Khosrowshahi said in a statement as he announced first-quarter earnings in early May. Even electric bike use fell 80% compared to April. But Uber Eats has grown more and more in the process,” he said.
Uber To Make Acquisition Despite Risks
Uber's investment in its food delivery service is seen as a bet for the time being. This is because the market is quite crowded. This reduces the likelihood that Uber will profit from this business.
Last month, Uber lost the race to buy GrubHub, which is valued at $7.3 billion, against Just Eat takeaway, a Dutch-based company. DoorDash announced that it had received $400 million in new financing, increasing the value of the company to about $ 16 billion. At the same time, Instacart, again a food distribution company, received an investment of $225 million and increased its value to about $14 billion.
Postmates is seen as a pioneer in the food delivery industry, but does not have much say in the United States market. Postmates had 8% of U.S. food sales in May, according to analytics firm Second Measure. DoorDash had the largest slice of the cake, with a 44% share.
Of course, there is a chance that Uber's move will end well, but having such strong competitors in the market seems to push them a little.