Deliveroo: "The 'riders' who work 40 or 50 hours should have a pension" | Innovation
They are called Deliveroo Editions, although they are also known as dark kitchens or ghost restaurants. It is about facilities that produce dishes designed for home delivery in which only cooks work and where there is a continuous transit of delivery drivers giving out orders. The British food distribution company charges a commission for sale to restaurants that want to use the kitchens: they offer the service as a way to eliminate the fixed costs associated with opening a new establishment.
The development of this new income channel is one of the company's major bets, valued at around 2,000 million dollars. It has been underway for a year and a half and already has 30 Deliveroo Editions worldwide. Yesterday, the first of these open kitchens in Spain was inaugurated in Madrid. imminent opening anticipated this summer EL PAÍS RETINA. The co-founder and CEO of Deliveroo, the American Will Shu, attended the event.
To what extent is Spain important for Deliveroo's global strategy?
It's very important. The United Kingdom and Germany were the markets where home delivery of food was developed with companies such as Just Eat or Takeaway.com. That was version 1.0 of the business. 2.0 is our model: it is we, and not the restaurants, who deliver the food. We did not know if this formula would triumph in countries like France, Spain or Italy, where gastronomic culture is different from that of northern Europe. France is now our second market by far, and we are seeing similar trends in Spain and Italy.
How would you describe the financial health of Deliveroo?
Our revenues have increased 20% globally in 2017 compared to the previous year, but the most important thing is that the gross profitability of the company has grown dramatically. As we get bigger we also improve profitability. The United Kingdom is still our largest market. We do not plan to go public yet, although it will be a logical step in the future.
What exactly is a rider [así llaman en la compañía a los repartidores]?
I know it well because I was the first rider from Deliveroo, I still do it every two weeks in my London neighborhood [se ríe]. A rider is a contractor who works with Deliveroo to pick up food from a restaurant and deliver it to the customer. In 99% of the cases, at riders They care about three things. The first is flexibility, that is, being able to enter and exit the platform whenever they want, which allows them, for example, to work with competitors. That makes it a type of work very different from the traditional one. 82% of the riders In Spain he says that this is the number one reason to work with us. On average they work between 20 and 25 hours a week. Between 25% and 30% of them are students, and many have jobs with irregular schedules, as an actor or actress or caregivers.
The second is retribution. On average, in Spain we pay almost 11 euros per hour, so we are well above the minimum wage. And the third, the one that worries me the most and that I'm most happy about, is security. There has always been a dichotomy between security and flexibility that we have tried to solve in many countries. In Spain we have 1,000 riders and 600 applicants every week. That number would not be that high if we did not offer flexibility. But there are also people who want security. The question is how to make these two elements, flexibility and security, coexist.
Security being a self-employed worker?
I am not a lawyer or a politician, but I focus on the issue trying to adjust to what people want. Let's say you work 40 or 50 hours a week with Deliveroo. My opinion is that you should enjoy more employee-specific rights. But if you work once a month, it should not be like that. That's my philosophy and, although I'm not an expert in the field, I've asked my team to find a way to offer riders more security.
What kind of benefits are you thinking about?
We have already taken a step in that direction: we are the first company in offer global insurance. We are working very constructively with governments in Europe and Asia to see how we can maintain flexibility and at the same time offer certain benefits. These could be paid vacations, pension, sick leave ...
Under what formulas could that be offered?
We have to work with governments to develop them. The problem is that if I offer all these conditions today, the riders They would be considered employees and lose their flexibility. And I will not have 600 weekly applicants to rider if I eliminate the flexibility. People do not want inflexible jobs.
Flexibility is non-negotiable, then.
It is super important. This is not for us, but to ensure that there are still people willing to join our platform.
That flexibility is a claim to attract distributors implies recognizing that those who turn to Deliveroo obtain little income in other ways. Then you could say that the company works thanks to the poor working conditions of many workers.
Whoever wants to work for Deliveroo is welcome. We are paying 11 euros per hour and we offer insurance. You will not make money on the platform: If you have a job and want to have additional income, I think it's a good idea to complement them with Deliveroo. I do not agree that our model is an exploitation when we pay so much and the riders They have the possibility to work whenever they want.
In Spain, the courts have ruled that the linkage maintained by the riders with Deliveroo it's employees.
We are a young company, we are five and a half years old, and at the beginning maybe we carry out practices that we do not think too much about. But in our last version we have had trials in the United Kingdom, France and the Netherlands and the courts have finally determined that the riders they are self-employed I think our model is solid. I know there are also judicial matters in Spain. I do not know the details, but I know that we work constructively with the authorities.
Brussels prepares a directive that will regulate the workers of the digital platforms. What do you expect from her?
We want to be part of all these debates. I am not going to speculate with what can happen in a few years without knowing what kind of legislation is decided to apply.