Amazon’s Next Venture

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Source: restaurantnews.com

By Anthony Fratturelli

Amazon Restaurants are increasingly creating excitement for the food delivery lover in the United States. Amazon restaurants are Amazon’s food delivery service, which is available in various cities around the country. Currently, Amazon Restaurants are not offered in every part of the country. However, this has the potential to change following Amazon’s recent partnership with Olo, a restaurant ordering software provider. Furthermore, this partnership will allow Amazon to work with current customers that are using Olo’s software. Therefore, by receiving access to major Olo clients such as Chipotle, Shake Shack, and Five Guys, Amazon Restaurants has the potential to take off.

The reason that the new partnership with Olo is very important for Amazon Restaurants is that it allows new Amazon clients an easy onboarding process. Olo defines its success behind the idea that taking and delivering online delivery orders through Olo’s software creates the easiest experience for both client and customer. Some of Olo’s major clients use their online ordering software, as a result Amazon Restaurants will aim to incorporate these clients into their food delivery service. In regards to Chipotle, Shake Shack, and Five Guys, their customers are continuously calling for delivery services which can be seen in this statistic, nearly 65% of these restaurant customers are consuming their meals outside of the restaurant. Thus, this idea may become more appealing to these major brands.

While this new partnership between Amazon and Olo has the potential to change the food industry. There are some aspects of the service that need to be addressed before any major moves can be made between Amazon and Olo’s top clients. Currently, the top priority for Amazon to address seems to be the price of the service for the Olo clients. Amazon Restaurants receives 30 percent per delivery. Yet, this rate is higher than some of the major competitors in the food delivery industry. According to the NY Post, market leaders tend to receive takeaways between 15-25 percent per delivery. While this may seem like a minimal difference, investors may note that this can build up to a large loss. This, of course, will not be a deal breaker for a majority of potential clients, but has the potential to become an obstacle for some. Olo CEO Noah Glass believes that this partnership will grow and find more ways to make a splash in the food delivery industry.

Not only is this partnership viewed to have major potential, but it is also viewed as nearly a guarantee to succeed because of the confidence surrounding the partnership between Amazon and Olo. Grub Hub, a major competitor in the food delivery industry, has already seen a loss in stock by nearly seven percent. Therefore, many will continue to keep a close eye on this new and developing

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