Restaurant Lobbying Group Preps Fight Against Delivery Apps

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A lobbying organization with apparent ties to former Uber CEO Travis Kalanick’s dark kitchen startup is preparing to go to war against food delivery apps.

The Digital Restaurant Association (DRA) was formed in March by executives at Tusk Holdings, a lobbying firm hired by Kalanick’s City Storage Systems (CSS) — the parent company of CloudKitchens, the Financial Times (FT) reported Wednesday (Oct. 5).

PYMNTS reported last month that CloudKitchens has the backing of Microsoft, which helped the company with an $850 million funding round last November, giving the company a $15 billion valuation.

Read more: Microsoft Backs Uber Founder Kalanick’s Latest Venture CloudKitchens

The DRA’s goal is to help restaurants deal with regulatory fights surrounding dark kitchens, which purchase property to prepare food to be sold through delivery apps. A senior CSS executive, Guido Gabrielli, was listed on the DRA’s board but was removed following inquiries by FT into the group’s background and leadership, according to the report.

The DRA’s goal is to “fight to ensure restaurants have access” to customer information, something delivery apps have chafed at, pointing to privacy concerns, the report stated. The association also said it will lobby for permanent caps on delivery fees charged by third-party apps, something cities like Philadelphia and San Francisco have already passed.

See also: For Restaurants, Aggregators Are a Double-Edged Sword

A senior Tusk executive, speaking on condition of anonymity, told FT they disputed the notion that there are ties between the DRA and Kalanick’s CSS, saying the lobby group is currently “fully operated and funded” by Tusk Holdings.

Despite the popularity of delivery apps, restaurants still maintain an edge, according to research by PYMNTS.

Read more: Study Shows Over 77% of Restaurant Orders Are Still Done the Old-Fashioned Way

Orders using delivery aggregators account for a tiny share of restaurant transactions, even though an increasing number of diners use them to place orders. Almost 40% of consumers used a food aggregator to place an order over the last six months. However, aggregators accounted for only a marginal share of total transactions in that same time frame.

In the last year, the number of consumers using aggregators to make restaurant orders was between 35% and 42%. While a fifth of orders placed in the month before the PYMNTS study were made digitally, aggregators represented just 2.5% of restaurant transactions.

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