Bite Squad adds healthy portion to its markets around U.S.

Bite Squad is delivering a lot more bites to many more cities from Columbus, Ohio, to Sarasota, Fla., and Honolulu.

The restaurant delivery service that first launched in Minneapolis in 2012 has expanded to 30 markets, mostly through a flurry of 17 acquisitions of smaller delivery companies in recent months.

"This last year has been an acquire-a-palooza," said Craig Key, Bite Squad's vice president of marketing. "This is unprecedented for us."

The company in the last few months has been integrating these smaller firms, and all of them are now operating under the Bite Squad banner. Privately held Bite Squad declined to disclose what it paid.

When it first expanded to other markets a few years ago, Bite Squad set up in such cities as Seattle, Las Vegas, Miami and Austin, Texas.

But with the rapid proliferation of restaurant delivery services around the country as customers grow more accustomed to ordering goods and services through their smartphones, Bite Squad saw an opportunity to consolidate some of the players in the fragmented delivery industry.

Bite Squad's technology, including its consumer-friendly apps, has been a compelling draw for some of these smaller companies, Key said.

"That's what we really bring to the table," he said. "A lot of smaller companies don't have the means to build out their own apps that are fully functional. And we have amazing technology that routes drivers to be the most efficient so they get to restaurants when the food is piping hot."

As it has expanded, Bite Squad has found a sweet spot in more medium-sized markets, instead of more of bigger metro areas where many of its larger competitors such as DoorDash, Postmates, GrubHub and Amazon already have a strong foothold.

"If you live in New York City, you've never had a hard time having dinner delivered to your apartment," Key said. "But in places like Little Rock, these options have not been as readily available."

In some locations such as Gainesville, Fla., Bite Squad has taken over more than one operator, consolidating several delivery services including Gainesville2Go, 2 Dollar Delivery and Doorstep Delivery.

Florida-based Doorstep Delivery, with delivery in more than a dozen Southeastern cities, was one of the larger companies it bought. Bite Squad decided to discontinue delivery in some markets that were not high performers but has kept service in other markets such as Tallahassee, Fla., and Nashville.

Minneapolis is still Bite Squad's largest market in terms of volume of orders. In July, it expanded its delivery area in the Twin Cities to include western suburbs such as Maple Grove, Minnetonka, Plymouth and Eden Prairie.

Amid the heightened competition from the national players, Bite Squad has been dropping its delivery fees, which has been a key to its more recent success. The average delivery fee now ranges from $2 to $4.

Other services, unlike Bite Squad, depend largely on drivers who act as independent contractors, similar to Uber. Bite Squad trains and hires drivers as employees with the aim of providing better customer service.

With its recent expansion and acquisitions, Bite Squad now employs nearly 10,000 drivers nationwide, including more than 500 in the Twin Cities, where it also has about 150 corporate employees.

Kavita Kumar • 612-673-411