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Amazon Restaurants aims to simplify food delivery, sending GrubHub shares falling

  • GrubHub, a Chicago-based restaurant takeout service, saw its shares fall more than 6 percent on the news.
  • Through this integration, Olo's clients will be featured on Amazon Restaurants.
  • Some of Olo's restaurant partners include Chipotle, Denny's, Shake Shack and Wingstop.

Amazon bought grocery chain Whole Foods, and now it wants to work with more restaurants as it moves further into the food industry.

The internet giant has partnered with Olo, a New York-based food delivery service, to list Olo's clients on the Amazon Restaurants food delivery section of Amazon.com.

GrubHub, a rival Chicago-based restaurant takeout service, saw its shares fall more than 6 percent on the news, before regaining some ground to a drop of nearly 2 percent.

"Amazon's obsession with providing great customer and restaurant experience supports the evolving expectations and behaviors of today's consumer," said Noah Glass, CEO of Olo, about the deal.

Amazon Restaurants has integrated into Rails, Olo's application programming interface, which allows for restaurants to list their menus on third-party marketplaces.

Through the integration, Olo's restaurant partners will be featured on Amazon Restaurants, enabling orders through the delivery provider to go directly through a point-of-sale system.

Some of Olo's clients include Chipotle, Denny's, Shake Shack and Wingstop.

The goal of this partnership is to simplify the process for restaurants once customers' orders come in, while also allowing for companies to limit the amount of orders that they take during peak hours, Olo said in a press release.

"This integration will enable Amazon Restaurants to onboard new restaurants with ease, as well as quickly add more new choices and delivery options for customers," added Gus Lopez, general manager of Amazon Restaurants.

"We are excited to leverage Olo's digital ordering technology and continue rapidly growing our network of restaurants to give Amazon Prime members more options for fast delivery from their favorite brands," Lopez said.

GrubHub shares have been on a tear this year, up more than 35 percent in 2017. Last month, Yelp announced it was selling Eat24, its online food-ordering business, to GrubHub. The brands Seamless and MenuPages are also owned by GrubHub.

The race is on to get food delivered from popular restaurants to customers, and more quickly than ever before.

WATCH: Analyst: Whole Foods will add millions of Prime members