March 7, 2021

paultandesigns

We Make It Cool

Supply and Demand in China’s Supercharged Delivery Economy

BEIJING, CHINA — Chang Si’en races through a glitzy shopping mall in downtown Beijing, on a mission for pan fried dumplings.

As he speed-walks, he pleads with a disgruntled customer on the phone who’s missing her order. “I gave [your food] to the security guard!” Chang says. He’s already waiting at the counter of the dumpling shop for his next pickup, anxious to get back on the road.

Chang is one of millions of uniformed waimai xiaoge, or “delivery brothers,” who dart through traffic and zip across sidewalks on electric scooters, charging into office buildings and apartment complexes with bags full of meals and groceries.

Food delivery in China is a super-charged version of the rest of the world: a few swipes and taps on your phone, and in around half an hour, a uniformed delivery person will be at your door with your food. Getting delivery can actually be more affordable than cooking at home. 

That might seem absurd, but there’s a reason prices are so low: food delivery is a battleground between two of China’s biggest tech giants: Tencent, which has a majority stake in the Meituan delivery app, and Alibaba, which owns the food app Ele.me. Together, these two cover 98% of the delivery market share in the country, and compete by offering sizeable discounts in the hopes of winning the most customers. 

The Chinese food delivery industry was estimated to be worth around $97 billion in 2020. The pandemic made the industry even bigger, with more people ordering food at home, and new innovations in contactless delivery.

Qing Yu Lan is a restaurant chain specializing in mala xiangguo, or “spicy dry pot”—but they don’t have any dine-in locations. Instead, they operate out of shared kitchen hubs. Owner Su Rui’s goal was to bring Western fast-food methods  to wok-fired Chinese cooking. “We were thinking how we could ‘fire’ the chefs,” he says. “Eventually, [the] grabbing, blanching, frying and packaging were entirely standardized. Chefs are entirely out of the picture.”

But the ease and convenience of food delivery in China relies on millions of gig-worker delivery people, who often confront considerable danger with little protection or support.  “This is a high-risk job, you’re on the road all the time,” says Chang, who supports his wife and two children who live back home in Shanxi province, 500 miles away. He works from 7 a.m. to 10 p.m., making 60-70 deliveries every day, and earning less than $2 per order, or $1,200-1,400 per month.

Chang risks being penalized for late deliveries, even if the delay is due to a slow restaurant, or a customer not picking up their phone. Sometimes, it’s physically impossible to meet a deadline; routes are mapped by walking directions, forcing drivers to ride against traffic and on sidewalks to deliver on time. 

The unrealistic demands placed on workers have resulted in suicides, self-immolations, and wildcat driver strikes. A viral news story last year about the harsh pressures put on delivery workers prompted Meituan and Ele.me to relax some of their delivery time standards. But drivers still struggle with poor working conditions, abusive management practices, impatient customers, and low pay.

For Chang, the few hundred dollars a month he used to make in working in a steel factory was just enough to survive on. Now, he says what he makes as a delivery man is “still just barely enough.”