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Postmates is launching a subscription service with free deliveries

Postmates is launching a subscription service with free deliveries


And competing with the likes of Amazon and Uber

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On-demand delivery startup Postmates announced a monthly subscription service today called Plus Unlimited. It will cost $9.99 a month and come with free delivery on orders over $30 from the company's growing list of partners. The move is part of longer term strategy for Postmates to beat competing services big and small and become the de facto delivery method for local goods. Last year, the company launched a preferred merchant program to partner with retailers and restaurants, and just last month, it kickstarted its Plus service, which caps delivery fees at $3.99.

Now, with Plus Unlimited, Postmates hopes heavy users will pay $10 every month to cut down on how much they spend on delivery costs and order more from the app in turn. If it sounds like Amazon Prime, that's because Postmates is hoping it can become a source for both supplies and food delivery by challenging the e-commerce giant. Amazon has been ramping up same day and one-hour delivery services in various US and international markets.

Postmates is trying to take on Amazon Prime

Postmates' partner list is flush with food spots, but it also contains clothing options like American Apparel. Postmates predicts the number of partners will grow from the low thousands to 10,000 in the 40 markets it operates by year's end. Plus partners pay Postmates 15 to 30 percent of sales to receive the cheaper delivery fee and more prominent placement within the app.

Amazon is not the company's only concern. Postmates faces mounting competition from smaller startups like Munchery and Sprig, both of which have launched similar subscription services. Uber is also becoming more aggressive about food delivery with its new dedicated UberEats app. To its credit, Postmates says it's fulfilling more than 1 million orders per month, while Plus program orders account for 40 percent of all deliveries. But the company will need more partners, and strong subscriber numbers, if it's to compete with other food-delivery startups and Amazon simultaneously.