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I'm David Brown and this is Business Wars.

When the COVID-19 stay at home orders hit most cities in March 2020, the toll on industries across the United States was massive.

But the unprecedented event ended up being an unexpected boon to a sector of the economy that had been struggling for years.

App-based food delivery services like GrubHub, DoorDash, Uber Eats and Postmates.

But despite the food delivery app business more than doubling during the pandemic, these companies are still struggling to turn a profit.

And they're increasingly seeing their business model challenged by local governments, workers and the very restaurants they say they're serving.

Now consolidation is the name of the game. DoorDash bought caviar, Uber bought Postmates. There might be fewer players on the field.

But the game is still up for grabs. The winner might not be the company that offers the best service, but the one with the most cash on hand to outlast the rest.

We think O'Ronna is a technology reporter at the Wall Street Journal. She's been writing all about the industry and we'll discuss how apps like DoorDash and GrubHub plan to survive the multiple challenges facing their business. All that's coming up next.

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We think O'Ronna, welcome to Business Wars.

Thank you for having me, David.

It's great to have you with us. It's rare to get a business where all the combatants are still struggling to turn a profit, but the food delivery app sector is filled with contenders who haven't quite cracked profitability.

I know Grubhub's chief executive, Matt Maloney, told the Wall Street Journal that food delivery isn't always will be a crummy business, his words.

What do you think it is that this is such a difficult equation for these companies, breathe their guns?

To give listeners a sense of the kinds of costs that apps are dealing with, they pay the restaurant. They of course take a cut from the restaurant to provide the service, but they pay the restaurant for the food that people order.

Then they pay the driver.

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