Xu: Takeaway generates 3x to 5x higher incremental margins for restaurants
Tony Xu · The economics and trends of the restaurant industry, with Tony Xu of DoorDash · Apr 21, 2026 · at 25:43
DoorDash CEO Tony Xu explains restaurant cost structures and delivery economics to Stripe co-founder John Collison.
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“Rough math, you know, for every dollar of food that if you and I bought inside of a restaurant, you know, from the cost structure, you're gonna have 30% of that in the food and the packaging. You're gonna have 30% of it in the rent. You're gonna have 30% of it in the labor. Something like that. Rough math. And on that dollar, a restaurant can net 10 cents. On a takeaway order, you're still paying for the food and the packaging, but you're, you know, largely speaking, using the same labor And you're paying the same rent. And there are some exceptions where, you know, some restaurants have become delivery only and things like that. But by and large, on average, you're going to make, you know, three to five acts the margin, you know, the incremental margin.”
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