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Comment by proee | Hacker News Reader

He will probably need to up his price from $5 to $10 if he goes legal. The increased overhead (especially in NYC) will kill the operation.

If he wants to be really clever, he could offer on-demand pricing and ensure that he doesn't get overloaded with order and fail to deliver on time. People would text and say "how much?". Then he would reply with the on-demand pricing "$5 in 20 minutes or $15 in 5 minutes."

If someone in the subway is REALLY hungry they'd probably pay $15 for a sandwich - especially if they know there's a two hour ride home.

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You are over thinking this. The greatest part about this story is the simplicity. I bring sandwich to you - you give me $5

I'm trying to find the sustainable model in this operation. From reading the article he's obviously trying to take it to the next level. Having good advice from a hacker (such as on-demand pricing) could make his next move that much more likely to succeed. Hacker News is about creating and improving upon ideas. We're not here to keep the status quo - we're here to say you can do more and do it better...

NEWNAM: So what's next?

RONNIE: Next I'm looking to get into a legal kitchen. For example, a restaurant that isn't open for lunch. I would rent it out from them and just work the lunch shift delivering sandwiches everywhere.

I don't think the answer is to have a complicated fee structure, just charge more.

Much like food carts, this sounds like "clever ways to get around NYC real estate prices for commercially zoned kitchens". It isn't sustainable legally.

To get a street vending permit for a food cart in NYC, you have to resort to going through black market channels. New street vending permits haven't been issued since 1993. A lot of the permits sold on the black market are fakes anyway and prices can amount to tens of thousands of dollars. It's astounding how you have to deal with corrupt people to "legally" get into the New York City street vending market.

Same with taxi medallions.

If someone in the subway is REALLY hungry they'd probably pay $15 for a sandwich - especially if they know there's a two hour ride home.

Also, someone coming out of a bar or club after last call might pay $20 or more for one.

Running his service at those hours is more consistent with the drug-dealer analogy, too.

He can also use delivery times as an incentive the way Domino's used to, albeit in reverse: The sooner he gets it to you, the more you pay.

(Meaning, not to offer it outright in fixed increments like $5 for 20, etc., but as incentive for him to get there ASAP.)

Complicates things needlessly. By all means, charge more if necessary. But tiered pricing for a sandwich? I don't think so. Simplify.

The problem is he might become saturated with orders. He has two options - say he can't deliver or raise his prices so high that his remaining capacity will be filled with the highest priced customers.

As a customer I like choices and the on-demand pricing model allows him to tell his customers his product is always available - though sometimes at a higher cost.

So if he gets saturated w/ orders all he has to do is... hire another cook, or another delivery guy.

He could have like a whole network of sandwich makers, and a full-on switchboard to take the orders if it got too crazy.

But if he hires another cook, he's paying the cook when he tells the cook his hours are, whether or not it turns out he actually needs the cook for all of those times. If he were consistently saturated, hiring another cook is a good idea, but if it's just saturation that lasts under an hour, congestion pricing is a better model than increasing capacity and losing a lot of money when he's not using the capacity.

Can't he hire another cook as a subcontractor and also pay him with an on-demand model?

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