Restaurants

Jimmy John's partners with DoorDash but will still deliver its own sandwiches

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Key Points
  • Jimmy John's, one of the last holdouts against third-party delivery, is partnering with DoorDash.
  • The sandwich chain will still deliver orders using its own drivers, but being listed on DoorDash's app is expected to prompt new customers to try Jimmy John's.
  • DoorDash is looking to cash in on the coronavirus pandemic food delivery craze with its forthcoming IPO.
A DoorDash Inc. delivery bag sits on the floor at Chef Geoff's restaurant in Washington, D.C.
Andrew Harrer | Bloomberg | Getty Images

One of the last holdouts against third-party delivery has caved.

On Wednesday, DoorDash announced that Jimmy John's restaurants across the U.S. will be added to its delivery website.

But the sandwich chain, which is owned by Arby's parent Inspire Brands, will still task its own delivery drivers with dropping off customers' orders rather than entrusting it to DoorDash's gig workers. In a February 2019 ad campaign, Jimmy John's said it would "never" authorize third-party delivery companies to transport its sandwiches.

The partnership comes as DoorDash announces a new self-delivery service for merchants, which allows them to fulfill their own orders but benefit from the reach of DoorDash's app. According to the company's data, more than 120,000 restaurants offer in-house delivery. DoorDash is looking to lure them to its platform with the promise of a new customer base.

Jimmy John's piloted the partnership with 100 restaurants over six months before making it a permanent, chainwide deal. It will also join DoorDash's subscription program, which offers unlimited free delivery fees to paying members. As of Sept. 30, the program had more than 5 million subscribers, according to a regulatory filing.

The sandwich chain expects to meet new customers through DoorDash's platform and make its existing delivery system more efficient.

DoorDash is looking to cash in on the recent explosion of its popularity, driven by the coronavirus pandemic, in its forthcoming initial public offering. The company is trying to raise up to $2.8 billion, at a valuation of up to $32 billion on a fully diluted basis. That's double its last private valuation from just five months ago.

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