With the coronavirus pandemic forcing restaurants to rely more heavily on delivery, exclusive partnerships are becoming a thing of the past.
Restaurant chains are cutting deals with new delivery partners to expand their reach. The latest is Chipotle Mexican Grill. The Newport Beach, Calif.-based fast casual chain, which has seen digital sales jump throughout the pandemic, added Grubhub as a new delivery partner this week.
The move expands Chipotle’s delivery footprint throughout the U.S., including New York City where Grubhub’s Seamless business is a dominant player.
"We are working tirelessly to ensure our network of delivery aggregators can reach as many consumers as possible to deliver real food directly to their doorstep," Chris Brandt, chief marketing officer, said in a statement. "We're happy to utilize Grubhub's expansive network to reach more Chipotle fans across the country."
When CEO Brian Niccol came to Chipotle in early 2018, he accelerated the company’s partnership with DoorDash. The San Francisco-based third-party delivery company has been the brand’s main delivery partner for more than a year. The company, the largest player by market share in the U.S., also powers direct delivery through the Chipotle app.
Many chains began adding more delivery partners in late March when jurisdictions began mandating the closure of dine in service. In March, Chipotle, which also works with Postmates, added Uber Eats as a new partner.
The Grubhub partnership comes a few weeks after Just Eat Takeaway, based in the Netherlands, announced plans to buy the Chicago-based delivery operator, creating a global delivery giant that will serve more than 360,000 restaurant partners in 25 countries.
"Chipotle is a beloved brand, and we're thrilled to extend their fresh menu to our millions of diners across the country,” Seth Priebatsch, head of enterprise at Grubhub, said in a statement.
Like DoorDash, digital orders made through the Grubhub app can be scheduled for a specific time for doorstep delivery. Digital exclusive menu items like Lifestyle bowls are also available through third-party delivery companies, Chipotle said.
Digital sales grew 80.8% and accounted for 26.3% of sales during Chipotle's latest quarter.
As restaurants reopen for dine-in, Niccol recently told investors at a virtual conference held earlier this month that the gains made in the digital business are “sticky.”
“We're seeing 70%, 80% of all the digital gains stay, which would be a homerun for us,” Niccol said.
As of March 31, Chipotle has about 2,600 restaurants in the United States, Canada, the United Kingdom, France and Germany. The company is scheduled to release its second quarter earnings on July 22.
Before the pandemic, delivery represented 3% of all restaurant orders. It’s now grown to 7% of orders, according to the latest market research from The NPD Group.
For our most up-to-date coverage, visit the coronavirus homepage
Contact Nancy Luna at [email protected]
Follow her on Twitter: @fastfoodmaven
