Postmates delivers to nearly 3,000 cities nationally. / Bloomberg Postmates delivers to nearly 3,000 cities nationally. / Bloomberg

New Postmates Algorithm Saves You Money on Delivery

Postmates launched a new product on its app this week called “Postmates Party,” a group ordering functionality that offers users free delivery in exchange for pooling their nearby food orders.

A new algorithm groups nearby orders from the same restaurant and assigns them to be collected by one courier, increasing efficiency in dense urban populations where customers are already placing orders to the same restaurants at similar times. Users are given a five minute window to place orders with the restaurants listed on Postmates Party.

The functionality is available to Postmates customers in the following cities to start: Los Angeles, New York City, San Francisco, Miami, Chicago, Seattle, Las Vegas, Long Beach, Phoenix, San Diego and Orange County, and Philadelphia.

“It’s really driven by the vision of creating a logistics infrastructure for goods to move about a city at nearly zero cost to the consumer, which has been our mission from the very start,” Postmates chief operating officer Vivek Patel said in an interview on Wednesday. Patel said the team had been working on this particular development for a very long time, noting that it was a part of Postmates’ core user strategy from the start.

Restaurants listed on Postmates’ marketplace can expect to see “added order volume” as customers use the feature, Patel said. Postmates declined to comment further on whether this development would affect commission fee structures for restaurateurs.

What’s Best for the Customer

Uber Eats launched a functionality in some markets last October that offers users free delivery from a select group of restaurants with a five-minute window of time to place an order, similar to how Uber Pool works. Ritual, a smaller, Toronto-based food delivery service that caters to office lunch crowds, has been offering a “Piggyback” feature since it launched that groups singular orders together in a similar fashion.

“We’re thinking about what is best for the customer,” Patel said. “It’s part of the broader mission of how can you move goods throughout a city at different speeds and different costs so you can serve customers with any need or for whatever mood they are in at that time.”

Postmates currently operates in nearly 3,000 cities in the U.S., reaching 70 percent of the country’s population. The company confidentially filed for an initial public offering in February.

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