Just Eat and Takeaway.com, two of the bigger take-out and delivery businesses in Europe, announced they are in the ‘advanced stages’ of a merger. The deal would help them combine forces and take on more scale to compete better with Uber Eats and Amazon-backed Deliveroo.
The new entity would have an estimated market value of more than €10 billion. The companies say it would make them the world’s largest online food delivery platforms processing 360 million orders in 2018. Economies of scale are a critical part of making the financials of delivery and other transportation and e-commerce services work better. The company can develop more efficient routes and plot drivers more closely to pickups and drop-offs.
There are other areas where it also makes more sense, such as in terms of the investments that a delivery company will make in building better back-end systems to operate the services and the development of large scale ‘dark kitchens’. Having a wider network of restaurants and drivers tapping into new investments makes the payoff faster.