- Deliveroo launched pop-up kitchens called Rooboxes earlier this year to make it easier for restaurants to serve up takeaway food
- But the sites are in unused car parks and industrial estates — and some local councils say Deliveroo has not sought planning permission
- The temporary kitchens are important to Deliveroo’s growth strategy, and it will be a real problem for the startup if councils shut them down
Food delivery startup Deliveroo is in trouble over its new pop-kitchens, which help existing restaurants meet local demand for takeaway food.
According to an investigation by The Guardian, three councils in the UK have found Deliveroo has not sought planning permission for the temporary kitchens, which comprise shipping containers that sit in unused car parks and industrial sites.
Each cluster of containers is called a Deliveroo Edition, while the containers themselves are called Rooboxes. A Deliveroo Editions site will contain six or seven Rooboxes.
One site in Camberwell may close because neighbours have complained about the noise of Deliveroo delivery drivers turning up on mopeds, and because the site doesn’t have planning permission. Brighton and Hove council is similarly investigating a pop-kitchen in Hove, while Haringey council said it hadn’t received a planning application for Deliveroo’s site in Hornsey, north London.
According to The Guardian, Southwark councillor Mark Williams said: “The council is concerned by Deliveroo’s use of the Valmar Road trading estate as their kitchen pods are close to people’s homes, are clearly disturbing the residents and they didn’t apply for the necessary planning permission.
“We have served a planning enforcement notice that requires Deliveroo to stop preparing and delivering food from the site. We encourage them to work with us and listen to local residents so that we can find a long-term solution.”
Deliveroo launched its Rooboxes in April this year with partners like Busaba EatThai and Franco Manca. CEO Will Shu said he wanted Rooboxes in 30 sites by the end of 2017. The company has got temporary permission for seven Roobox kitchens in Tower Hamlets, according to the report.
Deliveroo told The Guardian that it was working with local authorities to resolve planning disputes. The company has not responded to Business Insider’s request for comment.
Rooboxes are important to Deliveroo’s growth
Deliveroo’s most recent results show that it is running on a razor-thin margin of around 0.8%. Clearly, the company will need to become considerably more efficient if it’s to justify its recent £1.5 billion valuation.
According to Deliveroo board member Martin Mignot, Deliveroo will achieve this by making takeaway food cheaper and more convenient than cooking at home. But Deliveroo doesn’t really set the prices, its restaurant partners do.
Currently, it costs restaurants a lot of money to run their high street locations, and that cost is passed onto consumers, whether they dine in-house or order takeaway. Deliveroo is trying to reduce that burden through the cheaper, portable Rooboxes — that’s why it’s fronting all the capital for the sites. If restaurants begin producing takeaway food more cheaply, then they can reduce takeaway food prices for customers. And that means more orders for Deliveroo!
It’s an ambitious plan — and if councils scupper Rooboxes at this early stage, then that could curtain an important avenue for Deliveroo’s growth.