Über Eats will launch in Germany this spring aiming to break Just-Eat’s dominant share.

Just Eat delivery driver takes a well deserved break in Germany
Takeaway.com (Just Eat)

Whilst Über Eats is in 45 countries, the company has not always found international plain sailing. In 2019 it exited South Korea and then India in 2020 along with several other smaller markets.

Just Eat’s German revenues soared 81% in 2020 to over Euro 374m. One reason is Deliveroo exited the market, four years after entering. It found competition was intense with local rivals Pizza.de and Foodora (now owned by Just Eat) well entrenched.

Über’s business model in Germany is to contract minicab firms who employ couriers. It’s the same system Über uses for its cab riding business. Über fired opening salvoes claiming Just-Eats commissions are ‘too high’ with consumers and merchants seeking ‘alternatives’. 

Will the Über name generate any ‘German’-halo brand empathy? I’m doubtful.

Globally few food delivery operators are making money. Doordash, leader in the US, is in the red. In fact yesterday Doordash announced new commission rates (i.e. increases) hoping to get merchants to pay up to 30% per order. 

Meitun the leader in China just eked a small profit. 

In March Deliveroo’s IPO was served half baked to investors. Its share price is now trading at a 40% discount. Investors worry that authorities will insist on fixed labour contracts and pension contributions, incongruous to its gig economy model.

Über Eats aims to break even in 2021, though the German foray looks likely to be expensive. Globally its revenues exceed US$4.5bn making it the largest western home delivery brand. Meitun by comparison is 4 times the size.