Editor’s note: The following is a guest post by Jonathan from GigSharks.com. Jonathan is an entrepreneur with extensive experience in the gig economy, and he regularly posts videos to his Youtube channel, Gig Nation.
Introduction to Delivery In the Gig Economy
I first started working in the gig economy about 8 months ago when I quit my job to pursue some entrepreneurial interests.
The idea was simple. Generate quick income in the short term sustain myself while I worked on some long term business ideas. At the time my car was no longer new enough to drive with Lyft or Uber, so I opted towards delivery apps.
The first app that I signed up for was DoorDash. They were the biggest name in the industry. The sign up process for DoorDash was easy. I was on the road delivering within a few days.
After delivering for a while with DoorDash I decided I wanted to branch out. I’d heard good things about Amazon Flex in the past (I had actually applied and been accepted months earlier, but I hadn’t made any deliveries).
My Amazon Flex account was deactivated for inactivity due to the lack of deliveries, so I reapplied. Somehow I was accepted back into the program within a week (this can take months depending on whether Amazon Flex is hiring in your area).
I also wanted to try Postmates, so I applied to deliver with them as well. Similar to Postmates, sign up was easy and I was on the road within a few days.
DoorDash Vs Postmates
DoorDash and Postmates are two of the biggest players in the food delivery app game. Both offer a flexible schedule, low vehicle requirements (you can even use a bike) and solid earnings if you understand the system.
Delivery Driver Earnings: Postmates vs. DoorDash
Let’s first compare what I was earning with DoorDash Vs. Postmates.
Doordash was very consistent with earnings for the first few months. Pay minimum was usually about $6.50 per delivery here in Seattle (pay is dependent on location), but I’d see bonuses during busy times that put me up to $8.00 or $9.00 per order during the dinner hours. The consistency was nice.
Doordash has since been testing a new pay model. Under the new pay model drivers get 100% of tips that are given to them, and the base pay is $2 per order. Other factors like distance and desirability as well as bonuses can increase the pay beyond the $2 base (anywhere up to $10) before a tip is added.
The new model allows for some higher total payouts, but also a solid amount of lower delivery totals for short pickups. Fortunately acceptance rate doesn’t matter, so drivers can ignore lower priced orders if they choose.
Overall, the test model is actually beginning to show some similarities to Postmates.
Postmates has always been a big player in food delivery. In a lot of markets it’s the most popular app, and if not usually second to DoorDash.
You keep 100% of tips on the platform, and tips can be very generous at times. The transparency in tipping is definitely a huge draw to the platform.
The downside is if you don’t get a tip it can be a bummer to pick up an order and only make $3 or $4 for that delivery. Even if averages are the same, a couple low orders back to back can hurt driver morale.
Postmates also makes it more difficult to see the total distance of an order before accepting, making it harder to screen out low pay orders that require long driving distances.
Flexibility of Scheduling
Postmates and DoorDash allow for a similar flexibility in scheduling. In some ways, Postmates is actually more flexible than DoorDash because you can log on at any time to deliver.
DoorDash will limit the number of drivers if it’s not busy. However, I’ve found that the increased flexibility can mean more time waiting around (by limiting driver DoorDash rewards drivers who schedule shifts with a higher volume of orders). More information on how to get more hours with the DoorDash scheduling system.
More Essential Reading on Delivery Gigs
- DoorDash driver requirements: Do you qualify?
- Should you be a driver for Postmates or DoorDash?
- Instacart: Should You Be a Full-Service or In-Store Shopper?
My Favorite Food Delivery App In Seattle
I’m always looking to maximize earnings as a delivery driver, so I leaned towards DoorDash for food delivery in Seattle.
Food delivery had been generating good income for me, around $100 to $150 a day for me in Seattle, and that was only working the lunch and dinner hours.
I quickly realized that it didn’t make sense to deliver food during hours people don’t eat much. Obvious, right?
So I decided to test out Amazon Flex.
I first got started doing distribution center blocks with Amazon Flex.
For these blocks, I would schedule a block (usually 3-4 hours) to deliver packages to Amazon customers.
The best part was I could schedule blocks in the middle of the day. This would help fill the void of downtime with food delivery with Doordash and Postmates.
More About Amazon Flex
- The RidesharingDriver.com guide to Amazon Flex
- Decoding Amazon Flex Order Types, Routes, and Warehouse Locations
Amazon Flex earnings + scheduling
I then would head to a distribution center (whichever one you scheduled a block at) and pick up a cart full of Amazon packages. These usually had between 30-40 packages for the 3-4 hour blocks. Average pay is between $18 and $25 an hour for these blocks. But this increases with demand. Busier times such as holidays can see much better payouts. Below earnings represent Distribution Center blocks in Seattle during increased demand times (payouts were higher than average).
Once I had scanned all of the packages into my app I was off to deliver.
Generally speaking, logistics on these blocks are done well. Most packages are delivered within a few neighborhoods that were close together. So between delivering one package and the next dropoff was often only a few houses down, and a couple miles at most.
With that said, there is a ton of variability in these blocks.
There were a few times when I picked up a block with starting point that was an hour away. Those were frustrating.
Overall, I would complete blocks in about 70% of the expected time. There was never a requirement to keep working after all packages were delivered. So that $18 to $25 an hour pay was really closer to $30 an hour before expenses.
Tracking your expenses can be difficult
Expenses were difficult to gauge. I had a distribution center near my house so travelling to pickup was light on gas. I usually had blocks with deliveries near the DC, so total gas + wear and tear was actually very low most of the time. There were some blocks when I would travel a total of only 20 miles while doing drop offs. I also had a few blocks where I only had to deliver a total of 10 or so packages (scheduled for 3 hours).
But this was weighed against some of the rough blocks. Downtown deliveries. Starting drop offs an hour away from the distribution center. There are definitely rough times delivering with Amazon Flex.
Comparing different Amazon Flex shifts
Distribution center blocks are only one of many types of blocks in Amazon Flex.
There are also:
- Whole Foods Blocks
- Prime Now Blocks
In the past, Amazon Restaurants also had its own blocks. And they had Instant Offers in Seattle as well. The instant offers were similar to delivering food with DoorDash or Postmates, but the payouts on average were much higher. Unfortunately, those days are gone as Amazon Restaurants has closed.
The Whole Foods Blocks and Prime Now Blocks are still very desirable, because they allow for Amazon customers to tip. Amazon Flex introduces blocks to all Flex drivers at the same time, and you must swipe first to win the best blocks. Naturally, these blocks with added tips are very hard to come by.
Which Is Better? Package or Food Delivery?
I actually wouldn’t say there is a clear winner here.
If you’re full time in the gig economy, you should consider delivering with Amazon Flex during slow hours and then food delivery during dinner and lunch hours. That’s been my best strategy for maximizing earnings.
Beyond that it depends on your personal preference.
Food delivery is far more flexible. You could take a single order and then sign off, and only do one order all week.
With Amazon Flex you are scheduled to a block. If there are no packages you still get paid for those hours. But you can’t screen the destination of deliveries for that block, so you could find yourself in quite the adventure (you can always call support and extend delivery time if you’re destination is so far away that it causes you to work beyond the estimated time frame).
For some the schedule is nice, it’s guaranteed money for those hours – and a decent chunk of hours at that.