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Portland approves 10% cap on fees that food delivery apps can charge restaurants

oregonlive.com

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Re: Portland approves 10% cap on fees that food delivery apps can charge restaurants

#61

Post by NovemberWhiskey »

paulgb wrote: post #32
Nextgrid wrote: post #13

Earlier quoted context omitted.

Food delivery worked for decades when it was done by the restaurant itself so worst-case scenario we wouldn't lose much as these companies go bankrupt and we go back to restaurant-provided delivery. In fact, with all their tech and economies of scale, I'm surprised food delivery services are doing worse in terms of per-unit profitability than the low-tech restaurant-provided ones despite already charging excessive fe…

You're right, and that's why I'm genuinely confused by what's going on. Restaurant delivery used to be a healthy market that didn't need to eat up external capital. Now we have a situation where: - Restaurants say they are paying too much. - Delivery companies are losing money. - Customers are paying fees to the sites in addition to the delivery cost we used to pay. What gives? It seems these can't all be true.

You missed out on:

- VCs continue to pour money into the delivery companies

... that is all that is required for this to continue. If that stops, presumably a whole bunch of these firms will fail and that will be the end of that.

Re: Portland approves 10% cap on fees that food delivery apps can charge restaurants

#62

Post by deleuze »

iso1631 wrote: post #19
darrenoc wrote: post #12

Earlier quoted context omitted.

Nope, they don't make any profit even when charging 30% fees. So this 10% cap will probably cause them to withdraw from the market.

I've had delivery takeaways in British towns and cities for 2 decades, well before the likes of ubereats and deliveroo. Those companies do their own deliveries and manage to make enough money to not even charge more for delivery (or offer a collection discount) - although usually a minimum cost of say £20. Why can't VC companies do it that efficently?

It's a harder problem, though. I can order from practically any restaurant at any distance on ubereats.

It's trivial for me to concoct an order that will take ~1h to deliver. With a $15/h minimum wage, that means ubereats needs to charge $15 in fees before making any money just to cover labor.

Re: Portland approves 10% cap on fees that food delivery apps can charge restaurants

#63

Post by yellow_postit »

chrisseaton wrote: post #42
brianlweiner wrote: post #38

Earlier quoted context omitted.

In at least some cases ... the prices you see on grubhub may be higher than the actual prices the restaurant is charging. E.g $17.99 vs $14.99

So the restaurants are getting the option of delivery and the increased customer base and advertising... for absolutely no change to themselves? And the customers who use delivery are the ones paying for it? And if they don't want to pay it they can still go straight to the restaurant who will again make the same money? Sounds like a win to absolutely everyone involved. What is everyone's problem? Why do we want to i…

Option implies that restaurants can opt in/out which for cases like GrubHub isn’t possible.

These apps can lead to poor experience and perception of the restaurant due to the delivery short comings and customers tend to transfer any unhappiness with the delivery as being the restaurants fault (eg late delivery and cold food).

Re: Portland approves 10% cap on fees that food delivery apps can charge restaurants

#64

Post by 0x202020 »

chrisseaton wrote: post #42
brianlweiner wrote: post #38

Earlier quoted context omitted.

In at least some cases ... the prices you see on grubhub may be higher than the actual prices the restaurant is charging. E.g $17.99 vs $14.99

So the restaurants are getting the option of delivery and the increased customer base and advertising... for absolutely no change to themselves? And the customers who use delivery are the ones paying for it? And if they don't want to pay it they can still go straight to the restaurant who will again make the same money? Sounds like a win to absolutely everyone involved. What is everyone's problem? Why do we want to i…

I think people get lured in by no delivery fee and reduced prices originally so they order at basically the normal price. But then once the introductory prices go away and the fees go up they get mad at the restaurant, not the delivery service

Re: Portland approves 10% cap on fees that food delivery apps can charge restaurants

#65

Post by jiofih »

chrisseaton wrote: post #42
brianlweiner wrote: post #38

Earlier quoted context omitted.

In at least some cases ... the prices you see on grubhub may be higher than the actual prices the restaurant is charging. E.g $17.99 vs $14.99

So the restaurants are getting the option of delivery and the increased customer base and advertising... for absolutely no change to themselves? And the customers who use delivery are the ones paying for it? And if they don't want to pay it they can still go straight to the restaurant who will again make the same money? Sounds like a win to absolutely everyone involved. What is everyone's problem? Why do we want to i…

There are plenty of “proxy shipping” services that operate under this model. They don’t conceal the fact that they are a third party unaffiliated with the provider.

In addition, most restaurants will not just accept takeout orders from a random person that shows up on a bike, it’s an organized partnership. I wonder how they even achieve that.

Re: Portland approves 10% cap on fees that food delivery apps can charge restaurants

#67

Post by [deleted] »

jiofih wrote: post #65
chrisseaton wrote: post #42

Earlier quoted context omitted.

So the restaurants are getting the option of delivery and the increased customer base and advertising... for absolutely no change to themselves? And the customers who use delivery are the ones paying for it? And if they don't want to pay it they can still go straight to the restaurant who will again make the same money? Sounds like a win to absolutely everyone involved. What is everyone's problem? Why do we want to i…

There are plenty of “proxy shipping” services that operate under this model. They don’t conceal the fact that they are a third party unaffiliated with the provider. In addition, most restaurants will not just accept takeout orders from a random person that shows up on a bike, it’s an organized partnership. I wonder how they even achieve that.

[deleted]

Re: Portland approves 10% cap on fees that food delivery apps can charge restaurants

#68

Post by bawolff »

discopicante wrote: post #49

This reminds me of Ticketmaster vs. Pearl Jam in the 90s where the band exposed that Ticketmaster takes a much bigger cut that ticket holders didn't see in addition to a small 'ticket fee' that the ticket holder did see. I remember during that time that the general consensus from music fans was that Ticketmaster was an evil and greedy company. Restaurant customers really need to change their perceptions and understan…

I dont really see why its my responsibility as a consumer to police if business deals resturants engage in are "fair". That is the resturant's job. Its part of running a business. Actually its the main part. If the deal doesn't make financial sense - then the business shouldn't make the deal. If the business cannot survive neither taking the deal nor not taking it, then the business is not viable and it should go out of business.

At most i support a law requring that resturants can set different prices for uber eats than for walk in customers

Re: Portland approves 10% cap on fees that food delivery apps can charge restaurants

#69

Post by treis »

chrisseaton wrote: post #42
brianlweiner wrote: post #38

Earlier quoted context omitted.

In at least some cases ... the prices you see on grubhub may be higher than the actual prices the restaurant is charging. E.g $17.99 vs $14.99

So the restaurants are getting the option of delivery and the increased customer base and advertising... for absolutely no change to themselves? And the customers who use delivery are the ones paying for it? And if they don't want to pay it they can still go straight to the restaurant who will again make the same money? Sounds like a win to absolutely everyone involved. What is everyone's problem? Why do we want to i…

It's falsifying the restaurants prices. Grubhub shouldn't be able to say a dish costs $15 when it actually costs $10. It's a false statement that harms the restaurant.

Sure, they will get some deliveries but what about the people that would buy at $10 but not $15? And what about the people that won't dine in because they think prices are 50% higher than they are.

GrubHub is skimming valuable customers while discarding others. That's good for them but ultimately harmful for the restaurant.

Re: Portland approves 10% cap on fees that food delivery apps can charge restaurants

#70

Post by castlecrasher2 »

chrisseaton wrote: post #42
brianlweiner wrote: post #38

Earlier quoted context omitted.

In at least some cases ... the prices you see on grubhub may be higher than the actual prices the restaurant is charging. E.g $17.99 vs $14.99

So the restaurants are getting the option of delivery and the increased customer base and advertising... for absolutely no change to themselves? And the customers who use delivery are the ones paying for it? And if they don't want to pay it they can still go straight to the restaurant who will again make the same money? Sounds like a win to absolutely everyone involved. What is everyone's problem? Why do we want to i…

>What is everyone's problem? Why do we want to interfere with this?

Because customers who order through Grubhub/Doordash blame the restaurant for issues such as high prices and wrong orders instead of Grubhub/Doordash. So on one hand, the restaurant gets increased business but on the other they never interact with the customer directly and so their business' reputation depends on Grubhub/Doordash/etc to not fuck up, which is unlikely.

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