This food delivery company doubled its orders in Canada. It's coming for the US next

Online food delivery is booming in Canada, at least for one company.

Posted Updated

Hanna Ziady
, CNN Business
CNN — Online food delivery is booming in Canada, at least for one company.

Just Eat said on Wednesday that orders in Canada — where it operates as Skip The Dishes — rose by 98% to 23.5 million in the third quarter compared with the same period last year.

Canadians have been used to picking up food from restaurants rather than having it delivered to their homes. But that appears to be changing, encouraged by restrictions imposed during the pandemic and lockdowns that kept people at home.

"We are now transforming that pick-up culture into a delivery culture, that's why it's growing so quickly," Just Eat's investor relations manager Joris Wilton told CNN Business, adding that the second quarter had seen similar levels of growth.

A big increase in the selection of meals offered by restaurants also helped, making consumers more likely to order food more often, he said.

Just Eat, which was formed through a high-stakes merger last year, is building a formidable position in online food delivery globally. Its next target is the United States.

Last month, the company's shareholders approved its $7.3 billion acquisition of Grubhub, which it said will create the world's largest food delivery company by revenue outside China.

Grubhub is present in more than 4,000 US cities. The combined group, which processed more than half a billion orders last year, will have more than 70 million active customers globally, according to Just Eat

The deal is expected to close in the first half of 2021 and will see it take on the likes of Uber Eats and DoorDash, as competition in the space continues to heat up.

DoorDash is now valued at $16 billion after it raised $400 million in June and Uber, which reportedly tried to buy Grubhub, is instead acquiring Postmates, calling the startup "highly complementary" to Uber Eats.

Two-thirds of Americans now order food delivery online, according to Morgan Stanley. "Growth opportunities are vast given extremely low penetration of the possible $350 billion US restaurant spend, including fast food," the investment bank said in a February report.

Just Eat said its worldwide orders surged 46% to 151.4 million in the third quarter compared with the prior year, delivering market share gains in Canada and the United Kingdom, where the company has increased spending on marketing to fend off rivals such as Amazon-backed Deliveroo and Uber Eats.

The acceleration in order growth widened "the gap to competitors in our key markets," CEO Jitse Groen said in a statement. That puts the company in a strong position for its "traditional growth season" in the fall and winter, Groen added.

Its shares, which are listed in London and Amsterdam, were up nearly 6% on Wednesday.

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