Not long ago, on-demand package pickup Shyp closed its doors, saying it had failed to achieve critical mass for its explosive growth strategy and a last-minute pivot to business customers was too little, too late. Now UberRush, Uber’s delivery service for merchants in New York, Chicago, and San Francisco, is following suit and will soon be out of business.
TechCrunch reported on Friday that the NYC Rush team sent out an email to customers informing them the service would shutter at the end of June 2018, adding that while the company believes in “big bold bets,” they had to move on to other applications of Uber technology. The site confirmed to TechCrunch the June 30th shutdown date was official:
“We’re winding down UberRUSH deliveries and ending services by the end of June,” an Uber spokesperson told TechCrunch. “We’re thankful for our partners and hope the next three months will allow them to make arrangements for their delivery needs. We’re already applying a lot of the lessons we learned together to our UberEats food delivery business in over 200 global markets across more than 100,000 restaurants.”
TechCrunch noted that it had long since forgotten the service even existed, which is generous given its existence at all may have eluded notice for many in the first place. In April 2017, Uber discontinued UberRush courier service for restaurants, encouraging them to switch to its UberEats program. It wasn’t a good omen for the already minor Uber division, given that Quartz reported at the time that former employees said restaurants were the bulk of its business and that UberEats was simply more lucrative:
While Uber will likely continue to face supply constraints from its Eats push, the food delivery platform offers a more attractive value proposition than Rush did. That’s because with Eats, customers place their orders through Uber’s app. The company collects a delivery fee ($5 in most cities), a cut of around 30% from the restaurant, and a cut of 25% to 30% from the courier on each order, rather than the flat mileage-based fees on Rush.
In any case, the market for people willing to pay premium prices for somebody to go pick up their packages is apparently a good bit smaller than the market for having someone pick up your pizza.
This is hardly Uber’s biggest recent loss, though, as the company has continued to shed billions of dollars as part of an exhaustive growth strategy that is hitting a wall in some markets. The company recently bailed on its Southeast Asia division, opting to sell it and the 600 million potential customers living in the region to competitor Grab in a deal that has attracted the attention of Singaporean anti-competition authorities.[TechCrunch]