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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

#171

Post by falcolas »

iso1631 wrote: post #118
falcolas wrote: post #46

Earlier quoted context omitted.

Honestly, those delivery companies are probably underpaying their employees for delivery. I've worked at a pizza delivery company, and including tips, I earned about $140 a day (inflation adjusted, post-taxes) for delivering pizza all over town. It was certainly not enough to provide for a long-term living, given the vehicle upkeep costs and gas.

When I think of "Uber", 'well-compensated employee' is not something that comes to mind.

In personal opinion territory: And that’s a damned shame. Contract drivers should be able to survive on their full time work (and afford any of the externalities pushed on them by Uber) like any other full time worker.

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

#172

Post by fortran77 »

colinmhayes wrote: post #123
maltelandwehr wrote: post #71

Next week there will be complaints that food delivery services are no longer catering to certain areas. Instead of accepting that it is just not profitable for them, journalists will label it as backslash or an act of punishment. Same thing happened in others states/cities that implemented similar rules. The winners are people living in central areas of the city with lots of restaurants. The losers are the poorer out…

I don't understand why people in central areas of the city order delivery. There are 10 amazing restaurants within easy walking distance of me, why order delivery when I can walk for 5 minutes instead?

If you have enough discretionary income, why not circulate it and help expand the econony? I'd never have a problem with any of my neighbors spending money, and especially not locally.

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

#173

Post by gruez »

mchusma wrote: post #108

If we were going to limit profits, we should target visa/MasterCard/amex instead. They are a true oligopoly taxing the entire economy and have acted in a highly anti-trust fashion. Limiting their fees to something like 0.1% of the transaction is plenty to not lose money and would put back something like 2.8% of every transaction back into lower prices or into the businesses hands.

The actual benefits to consumers/businesses is going to be much less than 2.8%. For one, actual interchange fees today is nowhere near 2.9% like you suggest. It's not a flat rate, and varies wildly depending on the credit card type and merchant category[1]. For instance, a supermarket might get charged around 1.5% if the customer is using a basic credit card, or 2.1% if the customer is using a top end rewards credit card. I suspect that the weighted average of interchange rate across all consumer spending is probably under 2%. Of that 2%, a big part of it is probably also being passed to consumers via cash back/rewards programs. In Europe where interchange fees are capped, their cash back/rewards program are significantly worse than the ones in US. Combining all these factors, I'd say that the total savings to businesses and customers combined is probably under 1%.

[1] https://usa.visa.com/dam/VCOM/download/merchants/visa-usa-in...

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

#174

Post by willcipriano »

bmmayer1 wrote: post #151
inkaudio wrote: post #99

This is a regulatory response to Silicon Valley’s implementation of predatory pricing. Let me explain: Predatory pricing is defined as “the pricing of goods or services at such a low level that other suppliers cannot compete and are forced to leave the market.” For silicon valley startups like Doordash and Grubhub this is accomplished by acquiring customers at a significant loss in ways that may often seem idiotic. e…

Isn't this a price cap, to prevent prices from getting too high? What does that do to protect against prices that are too low?

If prices are only legally allowed to rise so far it will be harder to find investors willing to throw money in the "make prices low to grab market share fire" as the highest possible rate in now 10% regardless of market share.

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

#175

Post by lotsofpulp »

_sbrk wrote: post #160
inkaudio wrote: post #99

This is a regulatory response to Silicon Valley’s implementation of predatory pricing. Let me explain: Predatory pricing is defined as “the pricing of goods or services at such a low level that other suppliers cannot compete and are forced to leave the market.” For silicon valley startups like Doordash and Grubhub this is accomplished by acquiring customers at a significant loss in ways that may often seem idiotic. e…

"Although the FTC examines claims of predatory pricing carefully, courts, including the Supreme Court, have been skeptical of such claims." Which means that predatory pricing rarely, if ever, exists. If you don't like the 25% delivery fee, GET OFF YOUR ASS AND GO GET YOUR OWN FOOD.

Yes, this is a completely unnecessary law. Restaurant phone numbers are seconds away using the same device used to order from these apps, and a phone call is free.

Absolutely no reason a restaurant can’t recoup extra costs by charging the app users more or simply refusing to do business with the app.

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

#176

Post by [deleted] »

SwiftyBug wrote: post #159
empath75 wrote: post #50

Earlier quoted context omitted.

It could scale if there's enough people ordering food from the same geographic location to the same geographic location at around the same time. Imagine a bunch of ghost kitchens next to each other in an industrial park, offering discounts to certain neighborhoods if they agree to order in a certain time frame.

Brazilian iFood already does this. You can order a 1.85 USD meal (with no extra fees) a day in advance. It arrives at a predefined time in a generic iFood package. I've never seen such an unappetizing dish in my life, including what I've seen children be fed in a really poor orphanage I used to volunteer in. I really hate the distopic future we're heading into.

[deleted]

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

#177

Post by a_c_s »

occamrazor wrote: post #137
treis wrote: post #69

Earlier quoted context omitted.

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 discardin…

It is unethical only if Grubhub says “I will deliver joe’s 12$ burger to you for a 4$ delivery fee” when the burger costs actually 9$. There’s nothing wrong if they say “I will bring you Joe’s burger for 16$ including delivery.” In general we don’t expect resellers to reveal their cost of goods sold.

> It is unethical only if Grubhub says “I will deliver joe’s 12$ burger to you for a 4$ delivery fee” when the burger costs actually 9$

That's exactly what Grubhub is doing.

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

#178

Post by chrisseaton »

treis wrote: post #164
chrisseaton wrote: post #149

Earlier quoted context omitted.

I don't really get it. Doordash or whatever says 'for $x we will put a WhateverBurger burger into your hand'. As long as that's what they achieve, this seems fundamentally honest to me. As a consumer I don't really care where that $x goes to - Doordash, WhateverBurger, delivery person... doesn't seem my business to interfere in people's private financial agreements. The diner gets offered a deal and can take it or no…

>Doordash or whatever says 'for $x we will put a WhateverBurger burger into your hand'. As long as that's what they achieve, this seems fundamentally honest to me. What percentage of customers do you think understand that Grubhub is marking up their food? >If they aren't, they can turn it down and go elsewhere. That's precisely the problem. Some of the restaurants customers are turning it down and going elsewhere bec…

> What percentage of customers do you think understand that Grubhub is marking up their food?

Why do they need to care about the markup? If the burger price seems like a good deal, go for it, otherwise don't.

> Some of the restaurants customers are turning it down and going elsewhere because Grubhub has misrepresented their prices.

Well then that seems like the situation is fixing itself due to everyone's free ability to do what they want? So why are we complaining?

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

#179

Post by abc-xyz »

chrisseaton wrote: post #94
treis wrote: post #69

Earlier quoted context omitted.

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 discardin…

> It's falsifying the restaurants prices. It's marking them up... yeah. Is that a problem? Do you realise when you go to a store all the products are 'falsified' by marking them up on top of what the producer sells them to the retailer for?

I’m pretty sure that in most countries, a store can’t just sell another company’s products without entering an agreement with them. This agreement allows the company to set a minimum and maximum price for the product.

Imagine you’re selling chocolate that you want people to associate with luxury/wealth. To achieve this you might want to limit resellers to be 5 star hotels and luxury stores rather than the 1 dollar store.

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

#180

Post by hartator »

_sbrk wrote: post #160
inkaudio wrote: post #99

This is a regulatory response to Silicon Valley’s implementation of predatory pricing. Let me explain: Predatory pricing is defined as “the pricing of goods or services at such a low level that other suppliers cannot compete and are forced to leave the market.” For silicon valley startups like Doordash and Grubhub this is accomplished by acquiring customers at a significant loss in ways that may often seem idiotic. e…

"Although the FTC examines claims of predatory pricing carefully, courts, including the Supreme Court, have been skeptical of such claims." Which means that predatory pricing rarely, if ever, exists. If you don't like the 25% delivery fee, GET OFF YOUR ASS AND GO GET YOUR OWN FOOD.

> GET OFF YOUR ASS AND GO GET YOUR OWN FOOD

Nah, I’ll just ask the police to do something about it.

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