Steps Square Has Taken to Grow Its Caviar Business


Aug. 21 2018, Updated 9:31 a.m. ET

Integration with Square for restaurants

The US market for third-party restaurant food delivery services is expected to grow to $15.5 billion by 2022, according to Pentallect. The market was valued at $8.5 billion in 2017. Square (SQ) is a food delivery provider that competes with GrubHub (GRUB) and Uber.

Square offers food delivery services through its Caviar unit. As part of its effort to capture a larger share of the food delivery market, Square is integrating Caviar with its restaurant management platform, Square for Restaurants, which it launched in May. Square for Restaurants has drawn strong interest from large restaurants. Square said earlier this month that the average restaurant on the platform makes more than $650,000 in gross annual sales. Integrating Caviar with Square for Restaurants could help Square draw larger restaurant partners to its food delivery service.

Article continues below advertisement

Caviar going for corporate customers

As part of the push to draw larger customers to Caviar, Square acquired corporate catering start-up Zesty in April, thus broadening Caviar’s market by adding food deliveries to corporate customers.

Square is also cutting exclusive deals with restaurants to give Caviar a competitive edge. For example, some restaurants have signed up only to deliver take-out foods through Caviar. Square said recently that more than 25% of Caviar volumes come from exclusive restaurant partners.

Rivals aren’t asleep

But Square’s competitors are not standing still. GrubHub last year acquired Yelp’s (YELP) food delivery business and struck a partnership deal with Yelp to strengthen its own food delivery service. In Russia, Yandex (YNDX) partnered with Uber to strengthen its food delivery service in that market.

Square said Caviar revenue more than doubled in the second quarter. It did not disclose the exact amount.

Both Square and Twitter (TWTR) are run by Jack Dorsey as CEO. Dorsey has said there are potential synergies between the companies.


More From Market Realist

  • CONNECT with Market Realist
  • Link to Facebook
  • Link to Twitter
  • Link to Instagram
  • Link to Email Subscribe
Market RealistLogo
Do Not Sell My Personal Information

© Copyright 2021 Market Realist. Market Realist is a registered trademark. All Rights Reserved. People may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.