Prepared meal delivery might be the most exciting market for a gig driver. According to a recent Gridwise blog post, Rideshare vs. Delivery: How Much Did Drivers Earn In 2022? experts predict the meal delivery market will skyrocket by a compounded annual growth rate of 12.33%. By 2027, sales are projected to reach a global total of $1.45 trillion. User penetration in the online food delivery segment will likely reach 37.2% of the population in 2023.
We’ll talk about what’s driving this later in this blog post, but for now, we can confidently say the gig-driving market for delivering prepared meals is one that you should explore. It is important to get ground-floor experience because growth will explode in the next few years, bringing many new developments.
In this blog post, Gridwise examines the food delivery market and recommends how you might approach it as a driver.
Here's what we cover:
Some experts estimate that DoorDash has a 59% share of the food delivery market, withUber Eats is next in line with 24%. Drivers often ask, “Which is better, DoorDash or Uber Eats, to work for?”. Is it possible that Uber Eats is better than DoorDash for drivers when we look at the bigger picture?
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What’s driving this explosion in the food delivery industry?
Entrepreneurship and technology are making this boom in prepared food delivery brimming with opportunity for everyone. According to a January 2020 article in the Los Angeles Times, food industry leaders liken delivery to the concept of drive-through service that expanded in many establishments in the ‘50s and ‘60s. Prepared food delivery has prompted increased sales from existing establishments, but more significant, the creation of entirely new food industry sectors.
A closer look at DoorDash
DoorDash was founded in 2013 by Stanford students Andy Fang, Tony Xu, and Stanley Tang. The firm operates out of its corporate headquarters in San Francisco. DoorDash also owns a delivery service called Caviar, among other subsidiaries. According to the website Quartz, DoorDash sidestepped the competition early on, recognizing that the average order size was larger in suburban markets.
The strategy paid off. By 2019, DoorDash claimed ownership of the largest slice of the pie in the food delivery market, surpassing Uber Eats in the #2 spot and Grubhub in the #1 spot. In 2021 the firm had over $3 billion in revenues. Today, DoorDash dominates with a 59% market share.
Supermarket News reported that in 2021, DoorDash launched DoubleDash, a service that provides shopping at retail locations, including 7-Eleven, Walgreens, Wawa, QuickChek, The Ice Cream Shop, and DashMart (a DoorDash-exclusive store offering thousands of convenience and grocery items), in addition to selections from local restaurants. They even deliver for Tractor Supply.
DoorDash vs. Uber Eats: What drivers should know about Doordash
DoorDash is a darling among would-be delivery drivers because the company has the lowest age limit, accepting drivers as young as 18 years old (delivery of alcoholic beverages, however, requires drivers to be 21 or older). Interestingly enough, DoorDash guidelines specifically state that as an independent contractor not only can you have someone else with you when you deliver, but someone else can complete the deliveries too.
Another facet of DoorDash that draws drivers is that there is no age limit on the delivery vehicle. Depending on the market, delivery drivers can also use scooters, bicycles, e-bikes, and even motorcycles (check out this blog post by FinancialPanther.com on why you should consider using a bike for food deliveries).
Drivers can schedule shifts up to six days in advance for when they want to work, allowing them to choose times and locations that accommodate their driving style and strategy. They can log onto the app without scheduling; however, there may be times when the DoorDash app will not allow additional drivers in a region.
DoorDash is also experimenting with a challenge program, offering drivers bonuses for reaching certain goals. According to the DoorDash website, the program is still in beta mode and may not be available in all markets.
Some dashers qualify for DoorDash Early Access Scheduling. Drivers who meet specific standards can access scheduling seven days in advance, a day earlier than regular drivers. Driver requirements for this program include
- a customer rating of at least 4.6, a completion rate of at least 95%, and completion of at least five DoorDash deliveries between 12:00 AM the previous Friday and 11:59 PM the previous Thursday, or
- a customer rating of at least 4.6, a completion rate of at least 95%, and completion of at least 500 lifetime deliveries on the DoorDash platform
In June 2022, we reported on the Top Dasher program, reserved for the best DoorDash drivers. The program allows these drivers to dash anytime, even when the app is not accepting unscheduled drivers in that region during a particular shift.
A closer look at Uber Eats
Uber transitioned Uber Eats out of Uber Fresh, an earlier effort by the company to deliver food and other items. The company then launched Uber Eats in 2014. The firm, already experienced with apps and working with gig drivers, threw itself into mastering what FourWeekMBA.com referred to as the complex relationship of a three-sided network: eaters, restaurants, and drivers.
Uber Eats Vs. DoorDash: What drivers should know about Uber Eats
The rideshare component of Uber and Uber Eats works from the same app, so if you have already qualified as an Uber driver, you automatically qualify as an Uber Eats driver. There are no additional hurdles or online forms to fill out. Simply indicate that you want to receive orders from Uber Eats.
Drivers must be 19 years old with a valid driver’s license. Whether your car qualifies for Uber Eats varies from market to market, but generally, cars should be no older than ten years. In some areas, that is extended to 15 years. The same standards apply to Uber rideshare and Uber Eats in a given market.
Unlike DoorDash, you can get on the Uber Eats app anytime. Promotions called surges or boosts allow drivers to make additional money when meeting a certain number of deliveries.
Who pays more, Uber Eats or DoorDash?
The question, “Does DoorDash or Uber Eats pay more?” is complicated, especially when you start to break down the numbers. Let’s look at the numbers.
DoorDash vs. Uber Eats: Earnings per trip
Based on what drivers make per delivery, Uber appears to come out on top. These are 2022 numbers for median deliveries per order.
DoorDash vs. Uber Eats: Earnings per hour
The hourly numbers tell a different story. The numbers for Uber Eats vs. Doordash pay on a median hourly basis during 2022 work out as follows:
Although Uber Eats earnings per trip are 18% higher compared to DoorDash, DoorDash drivers complete 1.5 trips for every trip completed by an Uber Eats driver.
To learn more about doubling up on DoorDash orders, check out the video Driving For DoorDash (15 Expert Tips For Beginners) by Your Driver Mike. He addresses doubling up on orders at about minute 8:35.
Tip earnings per hour for meal delivery
|Uber Eats 2022
DoorDash drivers receive the highest tips, with Uber Eats and GrubHub going back and forth in the second and third spots, often divided by pennies. The combination of Uber Eats’ base pay and tips comes in 25% to 33% lower than DoorDash. However, if DoorDash drivers are making more deliveries per hour than Grubhub and Uber Eats drivers, one might think they would receive more tips. It might be due to DoorDash drivers having less face-to-face contact with their customers. DoorDash has an option on their customer app for the driver to ring the doorbell and leave, which was likely added for COVID concerns.
DoorDash vs. Uber Eats: Earnings per month
The real difference comes when we look at how much Uber Eats drivers make a month as opposed to how much DoorDash drivers make a month.
|2022 average monthly income
As you can see, the differences add up.
It is important to remember that these numbers take into consideration all drivers for both services. They represent drivers who make ten deliveries a night, five nights a week, and drivers who run the app on their way home from work and might make one or two deliveries three nights a week. Drivers who work a strategy and take advantage of incentives can make much more than the numbers we cite here.
A clear winner?
No, we don’t have a clear winner because it gets even more muddled.
According to a 2021 report by the consulting firm McKinsey, the US restaurant food delivery market is constantly changing. In May 2021, DoorDash dominated the San Jose, CA, market with a 77% share, Houston with a 56% share, and Philadelphia and San Antonio with a 51% share in each city.
Meanwhile, Uber Eats, which acquired Postmates in 2000, led the market in Los Angeles with a 50% share and in New York City with a 41% share. McKinsey added that the figures shift monthly as the platforms battle for local turf.
All this means is that demand for DoorDash or Uber Eats will vary from market to market, so it’s up to you to decide which one best meets for your financial goals.
Over-achieving drivers earn more
Most of the numbers we have looked at here reflect the median as opposed to the average. Looking at numbers on a median basis eliminates the outliers, those drivers who are either underperforming or overperforming for whatever reason. It provides a better picture of what the majority of drivers are earning.
Gridwise also looked at driver earnings from August 2022 and January 2023 on an average basis. Gridwise found enough overperforming drivers for DoorDash and Uber Eats services to push the average earnings much higher. Average hourly earnings reached $24.50 for DoorDash, and $25.60 an hour for Uber Eats. These earnings are comparable to what rideshare drivers make and in some instances, even better.
Why did the best Uber Eats drivers close the gap and overcome the earnings of DoorDash drivers? Mostly it is due to the bonus structure of Uber Eats, which rewards top drivers more than DoorDash.
The bottom-line message is that a well-honed strategy when delivering for DoorDash or Uber Eats pays off. Drivers who select the right areas to work and the best hours can substantially boost their earnings.
Should you be an Uber Eats driver or a Dasher?
In order to decide, drivers need to experiment and see which service works best for them. You may spend one week taking only DoorDash orders, and the next week accepting only Uber Eats orders. A smarter move might be to multi-app and see which works best for you.
The Gridwise app can help you with multi-apping. It’s worth checking out this feature. If you have not yet tried multi-apping, you can refer to a recent Gridwise blog post The Art of Multi-apping: How-Tos and Strategies for Gig Drivers.
Gridwise can help
Regardless of which food delivery company you drive for, Gridwise is here to make a difference in your earnings as a gig driver. From automatic earning tracking to free mileage tracking, Gridwise logs all your info and keeps it in one easily accessible place.
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