LONDON (Reuters) – Deliveroo will allow restaurants to use their own riders for orders placed through its takeaway food app, in a move which will boost the number of available outlets by 50 percent as it intensifies a battle with rival Just Eat.
All orders currently placed on the platform in Britain are delivered by one of the firm’s 15,000 riders, well-known for their distinctive black and teal jackets and delivery boxes emblazoned with its kangaroo logo.
Just Eat, however, works with restaurants which mainly supply their own drivers in Britain, and in limited cases uses third-party couriers.
Deliveroo hopes the change, which is called Marketplace+ and comes into effect in July, will boost the number of available restaurants from 10,000 to 15,000 by the end of the year with thousands more riders likely to be taken on.
Restaurants will be able to accept orders and assign them to either their own drivers or those on Deliveroo’s platform.
“Traditionally we’ve been unable to work with those restaurants … because they already have their own delivery fleet and so they thought ‘well we don’t really need Deliveroo,’” co-founder and Chief Executive Will Shu told reporters.
“We’re changing the game. We’re enabling these restaurants to tap into our delivery fleet,” he added.
Just Eat said in March it would spend an extra 50 million pounds ($67 million) this year to battle competition from rivals such as Uber Eats and Deliveroo, in a fiercely competitive market which has burgeoned in recent years.
Since making its first delivery in London in 2013, Deliveroo has expanded into 11 other countries with new markets due soon, prompting questions about whether the firm will pursue an initial public offering (IPO) as it continues to grow.
“An IPO – I’m not saying it’s off the cards,” said Shu. “It’s definitely something that we’ll consider but just not now. We’re not in any rush, we’re heads-down on trying to really grow this business,” he said.
Editing by Stephen Addison