Greggs picks Just Eat for home deliveries

Greggs has signed a delivery deal with Just Eat as the market for food takeaways continues to grow.

The tie-up comes after trials with other delivery firms such as Uber Eats and Deliveroo in Newcastle, London and Glasgow last year.

The service will now also be launched in Birmingham and Bristol, with other UK cities to follow.

The growth in the takeaway sector led to Just Eat being bought in a £5.9bn deal last week after a takeover battle.

New markets

Greggs chief Roger Whiteside said the firm aimed to be able to deliver across the UK by the end of the year.

Just Eat - which was originally founded by a group of five Danish entrepreneurs in 2000 - said the partnership with Greggs showed that firm was expanding "beyond traditional takeaways".

It added that its customers could also order from High Street chains such as KFC, Subway and Wagamama, as well as receive pizza deliveries from selected Asda supermarkets.

There is some debate around what benefits the partnership brings Just Eat, according to equities analyst Giles Thorne, given that there is no minimum order value for Greggs' low-cost goods.

"Whether it's profitable or not, we don't know. But Just Eat could justify working with a major brand on a loss-making basis in other ways," he said.

"This is ultimately about driving the utility of the Just Eat marketplace in the eyes of both consumers and restaurants."

He cites Uber Eats landing McDonald's for its delivery platform as a similar scenario.

"Bagging a major national brand means more people join the platform. If more people join the platform, that's a good thing for other restaurants using it too, creating an all-important 'virtuous circle'."

The size and popularity of the takeaway delivery market was demonstrated by the recent takeover battle for Just Eat between Dutch company Takeaway.com and investment firm Prosus.

After several months of courting Just Eat's shareholders, Takeaway.com finally triumphed. The deal will create one of the world's largest meal delivery companies.

Changing lifestyles

Takeaways maybe used to be reserved for a Friday night, but recent research shows people are ordering them more often.

A recent survey by KPMG suggests that two-thirds of adults in the UK enjoy them at least once a week.

Typically, people in the UK order 34 takeaways a year, spending between £10 and £15 a time.

Will Hawkley, global head of leisure and hospitality at KPMG, said the increased spending was down to a "lifestyle change".

He said: "People are just looking for more and more convenience, they're busier, working harder."

It seems the growth in food delivery apps also means customers are offered more choice.

Mr Hawkley added this was a positive for those with "specific dietary requirements that may have previously prevented them from ordering in."