Uber is spending a fortune on its food delivery business in London

UberEATS launched in London last month and the food delivery service got off to a bit of a rocky start with hordes of people experiencing lengthy delivery times and wrong orders.

These mistakes don't come cheap for Uber, which is trying to compete with rival operations like Deliveroo and the now bankrupt Take Eat Easy.

Every time UberEATS makes a late delivery it gives the customer £20 off their next transaction. That can add up to be a significant amount when hundreds of customers experiences multiple late deliveries, as Twitter would suggest.

I worked out that I've had over £80 off the eight orders I've made. My UberEATS receipts show I've ordered £109.95 worth of food but paid just £30-£40 for it. My colleague Rob Price thinks he's also had around £80 off.

 

Uber isn't just giving customers money off for late deliveries. Like many other food delivery companies, it's also giving people £10 credit for every friend they get to sign up to the service with their unique referral code.

For what it's worth, I don't think I've used Deliveroo once since UberEATS arrived. Why would I when I keep getting free credit from UberEATS? It's not like there's a huge amount of difference between the restaurants on each platform.

All this got me wondering how much money UberEATS is currently losing on its London operation. Unsurprisingly, Uber was not willing to share this information. However, UberEATS general manager Alex Czarnecki provided us with the following statement:

"When you order from UberEATS it's because you're hungry, and we think waiting more than 30 minutes when you're hungry is too long. That's why we made the 30 minute promise - if your food is not with you in 30 minutes, your next order's on us. Its no secret that when we launched London's appetite for UberEATS surpassed our predictions, which is why for the first little while the average delivery time was 36 minutes.

"However, since launch we have quadrupled the number of couriers on the roads, and now the average delivery time is 28 minutes. We're so confident in our network of couriers and restaurants partners that we're increasing the promise so that orders up to £30 will now receive £30 off their next order if it takes longer than 30 minutes."

Uber has raised $12.5 billion (£9.49 billion) to help it grow and expand worldwide. A considerable chunk of that is now being used to aggressively grow its food company.