It wasn't that long ago when only pizza places delivered. If you wanted Chinese, sushi, barbecue, fast food, or pretty much anything else, you had to go pick it up.
Domino's (DPZ) , for example, built its entire business model around making it really easy to get their mediocre-at-best pizza. The company understood that its products weren't pizza, pasta, and sandwiches. Rather, the real product was convenience.
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That advantage dimmed when Uber Eats, Lyft, DoorDash, and other services made getting food delivered from any restaurant easy (albeit with a price). Delivery, however, has its problems or at least its weaknesses.
The biggest issue might be that you are limited to ordering from one restaurant. Yes, you could place separate orders with multiple eateries, but your food will arrive at different times.
Delivery services have made getting food convenient, but some customers have become disillusioned with the added fees, higher prices, and poor customer service.
Those failings leave room for the market to be disrupted.
Serial entrepreneur Marc Lore has a plan to make that happen, and it involves his former employer, Walmart (WMT) .
Image source: Pixabay.
Marc Lore's Wonder partners with Walmart
Marc Lore made his name selling Diapers.com to Amazon.com (AMZN) for $545 million. He later sold Jet.com to Walmart (WMT) for $3.3 billion. His biggest success, however, may have been his four-year run leading Walmart's e-commerce efforts.
During that period, he dragged Walmart from its brick-and-mortar roots and forced it to invest in the infrastructure needed to compete with Amazon. That was no easy feat at a company so deeply rooted in physical stores and, if it hadn't happened, the retailer would be much weaker than it is today.
Lore, who now owns the Minnesota Timberwolves with Alex Rodriguez, has at least one more entrepreneurial act in him. He founded Wonder in 2021 with this idea:
- People would order food which would be produced in a van.
- The van would deliver it to their home.
That model, as you might imagine, failed, and Lore pivoted the company to using ghost kitchens in 2023. Under the new model, Wonder can offer multiple restaurant concepts for pickup, delivery, and limited dine-in all under one roof.
Wonder has now added its first kitchen/restaurant inside a Walmart with plans to open more locations in partnership with the retailer.
"The single kitchen inside the Fast Fine in Walmart’s Quakertown, Pa., location handles menus from eight restaurants with a fast-casual emphasis: Limesalt (Mexican), Yasas by Michael Symon (Greek), Alanza Pizza, Tejas Barbecue, Wing Trip, Burger Baby, Fred’s Meat & Bread (sandwiches), and Room for Dessert," RetailWire reported.
Wonder has solved a takeout and delivery problem
Lore's company makes it easy for a family to order takeout or delivery and be able to get whatever they want. Mom and dad might get Greek, while one child orders wings, and the other gets a burger.
It's a similar concept to the food halls that have been replacing the traditional buffet at casinos all across Las Vegas.
"I have more faith in this iteration of Wonder than I did in their previous model of using food trucks – which was always destined for failure," GlobalData Retail Division Managing Director Neil Saunders said, commenting on the RetailWire story. "The store-based model is a lot more sustainable and has better economics,"
Success, however, will depend on Walmart delivering enough customers. That's not a given since both McDonald's and Subway have closed many of their Walmart-based locations because they did not perform as well as standalone restaurants.
"This will rely on persuading existing customers to have a bite to eat in the store or get items to takeout. That requires a mindset shift which, although not impossible, will take time to bring about," Saunders wrote. "Of course, the store can also be a place for people to pick up online orders and that is sound as, by design, Walmart stores tend to be in convenient locations with plenty of parking."
