When you operate a delivery service for your restaurant, there's A lot of overhead. You have to strike a balance between paying deliverers their wages, and timely service for your customers. If you mismatch your number of deliverers to the business you have for the day, then you're either throwing away money, or making your customers wait a very long time for their food, which also may have knock-on effects in the kitchen, if you don't want the food to be cold, you might need to wait to start preparing it until your delivery guy is on the way back from his route. Outsourcing delivery to a delivery company seems like a win from restaurants, which is probably why so many have signed up for it.

And yet despite all the supposed barriers the most hole in the wall pizza joints had decent delivery service.

And the pizza arrived hot because they had an insulated pizza carrier. The good old days.

And also pizza places were very fickle with where they'd deliver to preserve that level of service.

True, there was a smaller service area. Luckily I lived in NJ so you could throw a rock and hit 3 pizza shops.