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Lunchbox Acquires Online Restaurant Marketplace Spread

by Jennifer Marston
August 3, 2021August 3, 2021Filed under:
  • Business of Food
  • Delivery & Commerce
  • Featured
  • Restaurant Tech
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Online ordering platform Lunchbox announced today it has acquired Spread, an online marketplace that aims to offer both restaurants and customers an alternative to Grubhub, DoorDash, and other major third-party delivery services.

Lunchbox’s online ordering software will power the transactions, while Spread will handle the deliveries. Pickup options will also be available for customers.

NYC-based delivery marketplace Spread was created to connect customers and restaurants without charging the former hefty commission fees, as third-party delivery services like Grubhub do. Restaurants that use the Spread platform can send promo codes and weekly specials directly to customers, who are then directed back to the restaurant’s own website to order. Spread charges a flat fee to restaurants (usually $1 or $2), rather than the typical percentage third-party delivery marketplaces use. 

Until recently, that percentage could reach as high as 30 percent per transaction, a figure that gutted restaurants’ already dwindling margins in 2020 as the COVID-19 pandemic shut dining rooms down. Many cities in the U.S. have since introduced caps on commission fees (some permanently), though the numbers still hover around 15 to 20 percent. 

Since the technical logistics of delivery are expensive and complicated, most restaurants can’t afford to to manage their own operation and more or less have to use Grubhub et. al. to reach customers. This is the cycle Spread and Lunchbox are hoping to break with their newfound partnership. 

The acquisition will also widen Lunchbox’s potential customer base to include independent, single-location establishments and mom-and-pop restaurants. (The company’s platform currently services multi-unit chains.)

The acquisition comes at time when more companies are emerging claiming to be an alternative to the major third-party delivery services. Companies like Ritual, Fare, and Inhousedelivery.com make claims similar to Lunchbox/Spread about reducing restaurants’ reliance on those services.

At the same time, third-party delivery services are offering their own alternatives to high fee caps. Grubhub debuted a “commission-free” option earlier this year, and DoorDash launched a tiered pricing structure for such fees. While these services come with their fair share of fine print, they’re nonetheless evidence that third-party delivery isn’t going to take the competition lying down.


Related

Lunchbox Raises $20M to Expand Its Online Ordering System for Restaurants

Lunchbox, an online ordering system for restaurants, announced today it has closed a $20 million Series A funding round led by Coatue. The round also included participation from existing investors 645 Ventures and Primary Ventures, and executives from Venmo, HelloFresh, and Planet Hollywood, according to a press release sent to…

Lunchbox Raises $2M to Simplify Omnichannel Ordering for Smaller Restaurants

Lunchbox, a relatively new entrant to the restaurant-tech scene, just announced a $2 million seed round for its software that simplifies restaurants’ task of managing orders from multiple sales channels. The round was led by Primary, 645 Ventures, Salido founder Shu Chowdhury, and Ananda Gala. This is Lunchbox’s total funding…

C3 and Lunchbox Launch a New App to Power Virtual Food Halls

Virtual restaurant company C3 and online order platform Lunchbox announced today the launch of a new restaurant app, CITIZENS GO. The app will provide ordering and delivery services for C3’s growing network of ghost kitchens, which number over 200 at this point, according to a press release sent to The…

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