People think they're calling restaurants directly but Grubhub is getting a fee
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Re: People think they're calling restaurants directly but Grubhub is getting a fee
#2Every article I read about restaurants just seems to reinforce that they are powered by their owners hopes and dreams rather than any financial or business literacy. It makes then ripe targets for exploitation.
Re: People think they're calling restaurants directly but Grubhub is getting a fee
#3I love this paragraph from the pizza arbitrage article, link below.
If capitalism is driven by a search for profit, the food delivery business confuses the hell out of me. Every platform loses money. Restaurants feel like they're getting screwed. Delivery drivers are poster children for gig economy problems. Customers get annoyed about delivery fees.
https://themargins.substack.com/p/doordash-and-pizza-arbitra...
Re: People think they're calling restaurants directly but Grubhub is getting a fee
#4It's disheartening that there's so much due diligence required just to conduct the most basic transactions right now. I have a narrow list of vetted restaurants, where I understand the costs and to the business, the delivery model, the safety (food handling and Covid precautions), and I only take out from these particular places. I tried a new place recently, only to find out I had been duped by Grub-hub, even though I thought I had placed the order on the restaurant's own site (or so I thought). When I went to pickup, the owner set me straight and gave me his card with the correct number. He showed me that I had paid an additional $25 in markup, as well as the fees he was charged, and this was a pickup!
Re: People think they're calling restaurants directly but Grubhub is getting a fee
#5> “If a customer calls to place a coffee order, we’re paying a $6.42 fee — for a coffee.”
This is wrong ! Plain and simple. $6.42 is probably more than the cost of the coffee.
Here are somethings you as a consumer can do to help,
1. If possible visit the restaurant personally, and order to go
2. Find the restaurant's phone number on their website / Facebook / Instagram / twitter page.
3. Leave a tip
I've found that yelp / google phone numbers can be in-accurate or lead to a proxy number.
Re: People think they're calling restaurants directly but Grubhub is getting a fee
#6Every article I read about restaurants just seems to reinforce that they are powered by their owners hopes and dreams rather than any financial or business literacy. It makes then ripe targets for exploitation.
Restaurants and mom and pop grocery stores/convenience stores are very low margin, super long hours, and stressful. Furthermore, it isn’t just places like Grubhub but also local governments with weird zoning laws and expectations that really exploit these businesses with random fees.
(My parents had a grocery store. They lost it during the previous recession.)
Re: People think they're calling restaurants directly but Grubhub is getting a fee
#7I love this paragraph from the pizza arbitrage article, link below. If capitalism is driven by a search for profit, the food delivery business confuses the hell out of me. Every platform loses money. Restaurants feel like they're getting screwed. Delivery drivers are poster children for gig economy problems. Customers get annoyed about delivery fees. https://themargins.substack.com/p/doordash-and-pizza-arbitra...
The lure of more business for local restaurants. An uptick in orders and free advertising could certainly help!
The lure of a weekend job for drivers. I've done it and made out pretty well on my motorcycle for a few hours on the weekend.
consumers love apps and they love being able to have visibility into the status of their orders. They want to shop online for food and have it appear without of phone call, or to discover new restaurants around them. Sometimes they have favorite sit down restaurants that aren't take out spots - but know they might have a listing on a fancier food delivery service.
App creators: take a cut off of everything on the top without actually inventing or doing anything. A logistics company elsewhere caught charging this much would be laughed out of the room but in a new and exciting field there's a lot of room for markup.
Cheers!
Re: People think they're calling restaurants directly but Grubhub is getting a fee
#8It's disheartening that there's so much due diligence required just to conduct the most basic transactions right now. I have a narrow list of vetted restaurants, where I understand the costs and to the business, the delivery model, the safety (food handling and Covid precautions), and I only take out from these particular places. I tried a new place recently, only to find out I had been duped by Grub-hub, even though…
>I tried a new place recently, only to find out I had been duped by Grub-hub
So you found a new restaurant, the restaurant found a new customer, and grub-hub is cut out of the (future) picture. Didn't grubhub earn that commission in this case?
I have no love (or hate) for grub-hub... but it seems like a business hired a salesperson on commission, knowing full well the parameters of the deal, and then gets upset when they actually bring in sales.
In most other industries the restaurant would be considered the 'bad guy' for trying to take the business direct and cheating the rep out of a commission.
Re: People think they're calling restaurants directly but Grubhub is getting a fee
#9Every article I read about restaurants just seems to reinforce that they are powered by their owners hopes and dreams rather than any financial or business literacy. It makes then ripe targets for exploitation.
Restaurants and mom and pop grocery stores/convenience stores are very low margin, super long hours, and stressful. Furthermore, it isn’t just places like Grubhub but also local governments with weird zoning laws and expectations that really exploit these businesses with random fees. (My parents had a grocery store. They lost it during the previous recession.)
My statement might have come across as harsh I understand that these kinds of businesses take a huge amount of blood, sweat, and tears; Especially since the ROI is often not really that great. It takes all the energy you have to run just the shop let alone comply with the city, county, state, and country regulations, source inventory, promote yourself, etc.
It doesn't surprise me they are getting exploited with the overwhelming mountain of stuff they need to manage. The small margins mean it's very hard to hire staff to distribute work too.
Re: People think they're calling restaurants directly but Grubhub is getting a fee
#10I love this paragraph from the pizza arbitrage article, link below. If capitalism is driven by a search for profit, the food delivery business confuses the hell out of me. Every platform loses money. Restaurants feel like they're getting screwed. Delivery drivers are poster children for gig economy problems. Customers get annoyed about delivery fees. https://themargins.substack.com/p/doordash-and-pizza-arbitra...
I have a bit of a different take on things than you're voicing.
Right now we have a bunch of (dine-in restaurant) businesses whose models have been disrupted by both the pandemic and government action; many of these restaurants have responded by emulating an adjacent type of business (delivery restaurants). The real problem is that the dine-in restaurants have a cost structure which does not allow them to compete with the delivery restaurants. Dine-in restaurants rely on fewer customers with higher average bills, and more profitable items on orders (especially liquor). Dine-in restaurants also have expensive facilities, due to rent, tax, and maintenance expenses.
You cannot successfully transform a dine-in restaurant into a delivery (or take-out) restaurant by simply putting the food in bags.