Takeout and delivery have been lifelines for restaurants struggling to avoid bankruptcy during the pandemic. According to OpenTable, the share of U.S. diners ordering takeout at least once a week rose 72% in April, and delivery was up 62%. And while dining rooms are now reopening across the country, plenty of customers will continue to shy away, opting to pick up the phone — or open an app — instead.
But before you choose your next meal, restaurant owners have an important request: Skip DoorDash, Grubhub, Uber Eats, and similar apps. See whether you can order directly instead, sparing cash-strapped restaurants the substantial fees these middlemen charge.
How substantial? Fees can eat up to 40% of each order, restaurants complain, and some are starting to fight back: A lawsuit seeking class-action status accuses DoorDash, Grubhub, and their ilk of hampering competition and imposing “unlawful price restraints” on the restaurant industry. New York City officials recently voted to join other cities in capping the fees delivery apps can charge during a state of emergency.
Bettina Hamblin, chef and owner of Farmacy in Knoxville, Tennessee, says her restaurant has paid up to 35% in fees and no longer uses any third-party apps.
"In an industry where you're looking to make a 15% profit margin at best, paying an excessive fee like that doesn't usually work in favor of a lucrative business model," she says.
Photo credit: Michele Pevide/istockphotoHamblin says there were other reasons she opted out of a relationship with Uber Eats, including driver cancellations and late pickups. She also says third-party apps “increase the cost of the food without our permission to whatever they want in order to maximize their own profits,” leaving the restaurant with little say over pricing.
Companies like Grubhub have responded to criticism by saying they provide a valuable marketing service for restaurants, and that their platforms connect restaurants to a much larger pool of customers than they would otherwise have. Grubhub has also acknowledged that it needs to do a better job explaining how the costs for its services add up.
Hamblin says her restaurant actually suffered from third-party marketing, however. "Grubhub began featuring Farmacy as an approved restaurant without our permission, presumably as marketing for themselves to present a wider network of restaurants on their platform," she says. "This led to customer complaints to Farmacy when orders weren't fulfilled because, in reality, we had never received these orders in the first place."
The bottom line, restaurants say: Call directly, or visit the restaurant’s website to see if it has its own system for managing takeout and delivery. Hamblin cautions against going through Google or Yelp to find links for ordering, because those links may have been specially set up by third-party apps so they can still take a cut of any resulting orders. "If a customer is having trouble finding a way to order online, simply call the listed phone number for the restaurant and ask someone who works there directly," she says.
Hamblin says it's more important than ever to help local restaurants, not "big companies with larger safety nets."
"Restaurants went to war back in March, and we are still fighting for our industry in a time where every penny counts for us right now," she says. "Although I appreciate that most third-party companies might be trying to provide a service that they feel is needed within the industry. I've yet to see one doing it to the extremely high standards for customer service that we've set for ourselves."
