Deliveroo has landed a significant new partnership with McDonald’s, ending rival Uber Eats’ four-year-long monopoly on the fast food giant’s online ordering and delivery business in Australia.
Starting this month, Deliveroo customers can order from the full McDonald’s menu at 422 restaurants across the country and have it delivered directly to them.
Ed McManus, chief executive of Deliveroo Australia, said the deal would help Deliveroo achieve its ambitious growth plans for 2020.
“Close to two million people nationally visit a McDonald’s restaurant everyday so we anticipate that they will be a popular choice on Deliveroo,” he said in a statement about the launch.
Deliveroo is currently the number two platform in Australia’s highly competitive online food delivery market, with 17.5 per cent of the market, according to research from IBISworld. Uber Eats is estimated to have nearly 60 per cent.
But the partnership with a major national chain like McDonald’s could see Deliveroo increase its share of the market, if it is able to provide a more attractive offer than Uber Eats.
The current prices for McDonald’s menu items are virtually identical on Deliveroo and Uber Eats, though the Quarter Pounder is 5 cents cheaper on Deliveroo, and the McChicken is 15 cents cheaper.
Deliveroo also charges just $4.95 for delivery on McDonald’s orders, compared to $5.99 on Uber Eats, though the fee may change depending on the distance and time it takes to deliver.
Deliveroo has not disclosed the terms of the agreement it reached with McDonald’s, though major players are understood to get better deals than smaller chains or independent restaurants, which may sacrifice as much as 30 per cent of their margin to delivery platforms.
Deliveroo saw a 30 per cent increase in the number of restaurants on its platform in 2019 to 14,000 restaurants. It has a presence in 13 cities around the country and reaches more than 11 million customers, and it expects these numbers to grow quickly off the back of its partnership with McDonald’s.