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What DoorDash pays, after expenses, and what’s happening with tips

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Re: What DoorDash pays, after expenses, and what’s happening with tips

#491

Post by dmode »

macspoofing wrote: post #397
dmode wrote: post #160

Why can’t we have normal businesses where you employ your workers and charge your customers the real cost of the transaction ? If that is not viable, don’t start the business to begin with. Let’s just go back to first principles, can we ?

>Why can’t we have normal businesses where you employ your workers and charge your customers the real cost of the transaction ? You have those. What's wrong with trying alternatives? There are good reasons to contract out services. If you're building widgets maybe it doesn't make sense for you to also employee cleaning crews or maintain your own transportation infrastructure - why not contract out these non-core serv…

That’s not what I am saying at all. What I am saying is that if your business is only viable by shafting employees, that’s not a business at all

Re: What DoorDash pays, after expenses, and what’s happening with tips

#492

Post by antisthenes »

squiggleblaz wrote: post #414
sschueller wrote: post #207

Earlier quoted context omitted.

We can, stop using and supporting these predatory companies. Never use Uber, Lyft, Doordash, Uber Eats, AirBnB etc. No exception irregardless how easy or cheap it may be. It's a small sacrifice but can and will make a difference. Using these services to me is like asking a waiter to pay for part of my meal. When it comes around to paying the bill are you able to face someone and ask them to pay for part of what they…

Is AirBnb as bad as the rest? I had understood the problem was that it was so lucrative it hurt people looking for a place to live. This is very different from the problem with Uber, Doordash etc. In Uber and Doordash, the person being hurt is a member of the transaction; in the case of Airbnb, I had thought they're a third party who couldn't get in.

AirBnb is just different.

My gut non-PhD economist feeling is that AirBnb has very few people from the bottom 2 quartiles participating in it in the first place. It's wealthy land owners offering short term rentals to people with substantial disposable incomes.

Cash and capital poor people are largely excluded (priced out) from the platform altogether, whereas on DoorDash and Uber/Lyft they comprise the vast majority of the service providers.

Re: What DoorDash pays, after expenses, and what’s happening with tips

#493

Post by rchaud »

TAForObvReasons wrote: post #211
Sevrene wrote: post #175

Earlier quoted context omitted.

This is just a natural outcome of the way venture capital funding works at the moment. When you care more about speculation than what's actually fundamentally occuring, you're going to get businesses funded that are not even able to survive on those basic fundamentals. If it weren't backed by large capital, it couldn't exist. This isn't always a bad thing, but on a whole, it does distort the market. At some point you…

I thought the plan was Dumping https://en.wikipedia.org/wiki/Dumping_(pricing_policy) Step 1) Use VC money to subsidize the price so that the market price is below cost Step 2) Continue to use VC money to subsidize while competitors, who don't have the same cash, lose customers and eventually contract or die off Step 3) Once you are the only real player, use your dominant position to raise prices

Don't forget Step 0:

- borrow ungodly sums of money at near-zero rates for a decade, and splash it on anything that moves.

Moral hazard? never heard of it!

Re: What DoorDash pays, after expenses, and what’s happening with tips

#494

Post by rchaud »

sschueller wrote: post #207
dmode wrote: post #160

Why can’t we have normal businesses where you employ your workers and charge your customers the real cost of the transaction ? If that is not viable, don’t start the business to begin with. Let’s just go back to first principles, can we ?

We can, stop using and supporting these predatory companies. Never use Uber, Lyft, Doordash, Uber Eats, AirBnB etc. No exception irregardless how easy or cheap it may be. It's a small sacrifice but can and will make a difference. Using these services to me is like asking a waiter to pay for part of my meal. When it comes around to paying the bill are you able to face someone and ask them to pay for part of what they…

I'm fortunate to live in a city with restaurants within walking distance and a solid public transport system. As such my use of food delivery services and Uber/Lyft is almost zero.

When I need delivery, I'll check to see if they offer it in-house. For pizza places I know they hire their own delivery staff, so I make sure to tip well.

Re: What DoorDash pays, after expenses, and what’s happening with tips

#495

Post by Spivak »

squiggleblaz wrote: post #480
Spivak wrote: post #396

Earlier quoted context omitted.

I have never assumed that the "delivery" and "service" fees went straight to the driver. The "delivery fee" is the premium I pay to get my food delivered and the "service fee" is the premium I pay for using X service to place the order. Trying to assume anything about where each dollar goes once you pay is a little silly. Those line items are prices for services. I mean when you order Papa John's for example they tel…

Hi, that's not what I said. If I go to AirBNB, it has a cost of the rental and a service fee. I assume that the rental cost goes to the owner, and the service fee goes to AirBNB. And likewise, if there's a delivery fee and a separate service fee for a delivery, I would assume the delivery fee goes to the one who does the delivery and the service fee goes to the middle man. What's the point otherwise? Why not just mer…

> Why not just merge them into one single fee?

If you had to add "delivery: $5.99" and "process order through FoodApp: $1.99" to your cart would it make more sense? They're services your purchasing. Do you expect the money for the pizza goes to the chef?

> I assume that the rental cost goes to the owner, and the service fee goes to AirBNB.

Why? Hostels.ru negotiates a rate with hotel chains and then charges you as much as they think they can get away with. No reason to think they're related.

Re: What DoorDash pays, after expenses, and what’s happening with tips

#496

Post by boh »

Balgair wrote: post #463
boh wrote: post #341

It's becoming abundantly clear the real innovation from on-demand services (including ride-sharing companies), is their ability to transfer more money from labor to capital with complex pay structures. For many if not most of these companies, its their only means towards profitability. For instance, any rise in revenue Uber experienced in the last 3 years was exclusively due to cuts in pay for drivers. Tech has long…

I recently got into EconTalk and burned through a few of their podcasts [0]. Roberts mentions his 'distain' for the minimum wage a fair bit during the shows. Many economists do not like the minimum wage at all for many reasons. However, with these gig economy jobs, there effectively is no minimum wage. Yes, things are murky here about the definitions of wage, employee, boss, etc. But the effective hourly rates are al…

There's no such thing as "real" minimum wage since the factors that result in having minimum wage must be included (taxes/regulations/cost of living etc). Just as looking at the wages of illegal immigrants doesn't represent the "real" economy, the gig economy, whose companies largely operate under artificial, VC inflated markets, and depend on heterogenous labor markets,can't gage "real" wages.

If you're wondering how low a wage can be and still retain employees, the answer is pretty close to zero. Even baring the no/very low wages that predominated human history, in the 20th century mining companies were able to avoid paying their employees money at all and instead provided tokens serviceable in stores the mining companies owned. The goods in those stores were sold with inflated prices, essential making the cost of labor close to zero.

The case against minimum wage is largely based off of highly isolated factors typically favoring shareholder economics.

Re: What DoorDash pays, after expenses, and what’s happening with tips

#497

Post by rchaud »

marketingfool wrote: post #355
sschueller wrote: post #207

Earlier quoted context omitted.

We can, stop using and supporting these predatory companies. Never use Uber, Lyft, Doordash, Uber Eats, AirBnB etc. No exception irregardless how easy or cheap it may be. It's a small sacrifice but can and will make a difference. Using these services to me is like asking a waiter to pay for part of my meal. When it comes around to paying the bill are you able to face someone and ask them to pay for part of what they…

We hosted an Airbnb, we got awards for being top hosts and provided a cheaper stay than our local trash hotel. Everyone that stayed over would become friends or friendly and we'd provide anything they requested. The problem is the trash hotel nearby doesn't like competition and reported us to the city.

If you are hosting guests at the home where you also live, I doubt anyone in this thread would oppose that. It's literally a bed and breakfast in the traditional sense.

Airbnb corrupted that by incentivizing a business model where investor groups buy up entire properties solely for Airbnb use. That's very different from what you're describing. They're acting as full-scale hoteliers, but evading hotel regulations and zoning laws by setting up shop in residential neighborhoods. And of course, reducing the overall housing supply for all the people who actually live in that area.

Re: What DoorDash pays, after expenses, and what’s happening with tips

#498

Post by rchaud »

lotsofpulp wrote: post #379
fouc wrote: post #368

Earlier quoted context omitted.

OYO hotels seems like another one based on this model. Heck maybe avoid most or all of the SoftBank funded startups?

Oyo is worse than the others. They think they can offer the same type of hotel quality without employing all the quality inspectors of Marriott/Hilton/IHG/Hyatt/etc. I don’t think any educated adult could be dumb enough to fall for that. I have to assume any VC taking part in a business that needs additional human labor to scale and hence has significant marginal costs is simply betting on being able to dump the comp…

Oyo's top VC happens to be none other than Mayasoshi Son.

Re: What DoorDash pays, after expenses, and what’s happening with tips

#499

Post by reaperducer »

Nextgrid wrote: post #384
reaperducer wrote: post #367

Earlier quoted context omitted.

Illegal. At least where and when I drove for Uber. And there were plenty of local government inspectors posing as passengers trying to catch these sorts of shenanigans.

Is there any reason why the law would be involved? Uber might not be happy but why does that have legal implications? Does this also mean they're not allowed to drive for anything else but Uber?

Off the top of my head, safety and taxes.

Ride hailing is regulated, in part, to ensure that people aren't being taken advantage of. It's also regulated to make sure that taxes and fees are being properly collected.

Taxis and private bus services weren't always regulated, but they became regulated because they took advantage of their customers. Similarly, regulations are placed on ride hailing to that passengers get what they paid for and there is at least some accountability.

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