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Amazon strikes deal with Grubhub parent company, offers free delivery to Prime members

Under the agreement, Prime members will get one year of free deliveries over $12 from Grubhub in 4,000 U.S. cities.
A food delivery courier for Grubhub Inc. in New York on April 6, 2020.
A food delivery courier for Grubhub in New York on April 6, 2020.Jeenah Moon / Bloomberg via Getty Images file

Amazon Prime members can now order food from Grubhub without a delivery fee.

The offer for Grubhub+ is good for one year, after which Prime members will automatically be charged the current $9.99 monthly rate for the service. There is a minimum $12 order to avoid the fee.

The deal follows an agreement between Amazon and Grubhub's parent company, Just Eat Takeaway, that gave the e-commerce giant the option to buy a 2% stake in Grubhub, even as it continues to explore a sale of the food delivery platform.

Amazon Prime has about 153 million members in the U.S. 

“We’re confident this offering will expose many new diners to the value of Grubhub+ while driving more business to our restaurant partners and drivers,” Grubhub CEO Adam DeWitt said in a statement.

After a pandemic surge, the growth of food delivery apps like Grubhub has slowed down as diners return to in-person eating and, increasingly, takeout orders. A study in May from Paytronix, a consulting firm that advises restaurants, retail chains and convenience stores, found that takeout now accounts for a majority of all digital orders.

"While delivery was king before and during the height of the pandemic, more recent data indicates that takeout orders now dominate digital orders, with numbers even higher than they were pre-pandemic," Paytronix said, adding that takeout orders "jumped from approximately 35% of orders in January 2020 to a majority in March of 2022, a trend that appears to be increasing."