Postmates Research Paper

In the United States you can literally order food online and it will be at your door in less than a hour. Postmates is an app where you can choose from many restaurants food you want and order it. After the order is confirmed Postmates deliver the food to you which is very convenient. Postmates was founded by Sam Street, Sean Plaice and Bastian Lehmann on May 1st 2011. The company headquarters is located in San Francisco, California. There are about 7500 orders processed per day with the average order size of 40 dollars. Postmates makes about 6.6 billion dollars in economic activity across US per year. The main goal for Postmates is to give brick and mortar businesses a tool to create larger retail scales because e-Commerce has been developing

By plugging merchants into smart algorithms that connect storefronts to new customers; mapping technologies that extend the geographical reach of their sales; and a vast courier network (150,000+ Postmates) — retailers are now able to move goods from their storefronts, to our doorsteps, faster than ever before” (Postmates Blog, n.d). Postmates platform is approximately 35 million households across America and saved about 11 million hours for customers in total for 2017. The sales earning did not only profit Postmates and the Merchants but it also helped the US economy. According to Postmates blog Postmates helped deliver economic growth across the US each year and for every dollar that is spent on Postmates, the additional sales, hiring and job creation leads to approximately $18.55 as an additional economic impact. There are three key reasons why Postmates has become so successful in such short time

As the role for merchants in the business of Postmates, they partner with Postmates so that the customers can get goods from that store using Postmates. Basically Postmates is a bridge between the merchants and customers. When merchants partner with Postmates, they get another platform where the customers can reach out for their goods more easily and conveniently. According to jungle works, Postmates launched a program for merchants where it ties up with local stores and signs an official agreement. The purpose for this agreement is so that the merchants can pay a certain percentage of the total bill to Postmates for their service adding up to company’s revenue (2016). The merchants are not complaining about the extra percentage of total billed amount to Postmates for the delivery since hiring staffs are more expensive than the small percentage they have to pay to Postmates. The greatest advantage about being able to get goods delivered to the door is that the customer base increases by gives online visibility to the merchant. In 2017 Postmates has helped merchant partners grow 3.7 times more than non partners economically. According to Reece Lichtenstein the owner of Homeroom in Oakland, CA “Since signing with Postmates, we’ve seen a 25 percent increase in our third-party delivery sales.” Adding on Danny Trejo who is the owner of Trejo’s Tacos in Los Angeles, CA stated that