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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

#221

Post by austhrow743 »

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?

5 minute walk then 20 minute wait then 5 minute walk back.

When you're earning $50+ an hour, which many in cities are easily clearing, it starts to make a lot of sense to pay someone else to do your waiting for you.

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

#222

Post by _sbrk »

amyjess wrote: post #193
_sbrk wrote: post #160

Earlier quoted context omitted.

"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 That's really something to say to people who are 100% quarantined during a pandemic.

I live in a state which has one of the highest new-cases-per-day number, and we can still go get take-out.

1) I call in my order. 2) I drive to the restaurant. 3) I put my mask on. 4) I go inside, get my sack of food. 5) I drive home.

We do a lot of cooking at home, which we find to be enjoyable, so this doesn't happen very often. Costco same-day (via Instacart), even when it tacks on 20% to the cost of items, is perfectly acceptable to me.

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

#223

Post by NovemberWhiskey »

paulgb wrote: post #162
NovemberWhiskey wrote: post #61

Earlier quoted context omitted.

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.

I didn't miss that, but usually the VC money ends up in someone's pocket. I'm thinking of all the meal kits and rides I got for next to nothing thanks to VCs and win-the-market-at-all-costs strategies. With food delivery, it feels like everyone is getting screwed.

My only theory on what the VCs are thinking is something like: "eventually, efficiencies in delivery costs will occur, perhaps due to the number of participants shrinking allowing better driver routing or new technology coming available (drones, automated delivery vehicles, who knows) - at that time, the dominant players will become massively profitable".

But I don't really get it.

To be clear, the people doing well out of this are the delivery customers who are receiving a subsidy from all other participants.

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

#224

Post by lotsofpulp »

pwinnski wrote: post #197
lotsofpulp wrote: post #184

Earlier quoted context omitted.

No one is forcing the restaurant to accept the fee, and if they do, then the restaurant should charge higher prices to offset it. Otherwise google maps and Apple Maps is sitting right there not charging any fees for the phone number.

I think you misunderstand. There are a number of restaurants listed on Yelp in my area for whom the phone number listed is answered by GrubHub. I refuse to deal with GrubHub, so I make an effort to search for a direct number, but it is often difficult to find. I'm not sure how GrubHub is getting themselves set as the primary number for restaurants in Yelp, but it's happening.

The solution to that is using google maps or Apple Maps or duck duck go or a phone book.

If people don’t understand that a middleman adds cost as an adult, then that is an education issue.

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

#225

Post by treis »

chrisseaton wrote: post #178
treis wrote: post #164

Earlier quoted context omitted.

>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 abilit…

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

Why don't you answer the question?

>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?

In what way is the situation being fixed?

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

#226

Post by citizenkeen »

cwhiz wrote: post #142
cocoa19 wrote: post #93

I disagree with this move. Why should we force a cap rather than let market competition improve prices? I believe it's better to fix shady practices. If I pay 25% to Uber, I want to know I paid 25% to them and not the restaurant. Then I can decide if the time savings is worth that 25% or not.

This is a cap on the invisible fee that Uber and other companies charge to restaurants. It is not transparent or visible on the consumer end that a restaurant is only getting 75% of the listed food prices. This is, in effect, forcing these delivery companies to be more transparent about their pricing. Instead of charging a restaurant an invisible 25% it will be capped at 10% and the delivery companies will have to mo…

Exactly. This is not a cap on prices, it's a cap on hidden prices. When the restaurants have to raise their prices to compensate for Uber's fee, Uber doesn't take the hit, the restaurant does.

This forces Uber to more clearly tell the customer how much their convenience costs, but it can be anything Uber wants.

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

#227

Post by mindslight »

crazygringo wrote: post #192

There are legitimate abuses of market power. But this is not one of them. Nobody's forcing restaurants to enter these partnerships, there's competition, and delivery people still need to be paid. There are two obvious outcomes here: either food delivery apps will restrict delivery to profitable orders only (stop working for some restaurants, require higher order minimums, etc.), or they'll stay to avoid bad press but…

It's amazing how many commenters have not read the article. This is not a cap on the total price of delivered food, but rather a restriction on the delivery service misrepresenting the price of the food itself. The obvious outcome is that the delivery services move their total fee into the appropriate line item labeled "Delivery Fee".

Also, there is an apparent lack of competition in this space, given that restaurants end up signing contracts that allow delivery services to setup fraudulent phone numbers to capture customers that would otherwise have a direct relationship with the restaurant.

Presumably the ordinance only applies during Covid times because afterwards the restaurants will regain a fair amount of bargaining power with their dine-in customers. Currently a restaurant can only see so many orders coming from a delivery service, and has no way of knowing how many of those customers would have been direct if not for the front running.

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

#228

Post by chrisseaton »

treis wrote: post #225
chrisseaton wrote: post #178

Earlier quoted context omitted.

> 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 abilit…

>Why do they need to care about the markup? If the burger price seems like a good deal, go for it, otherwise don't. Why don't you answer the question? >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? In what way is the situation being fixed?

> Why don't you answer the question?

Well I'm not the one who cares about it. I don't understand why anyone else would. So I can't answer it!

> In what way is the situation being fixed?

People who don't want to do business with Doordash don't have to. If you don't like Doordash you can just forget they exist. It's not a problem.

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

#229

Post by greenshackle2 »

chrisseaton wrote: post #100
yellow_postit wrote: post #63

Earlier quoted context omitted.

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).

> Option implies that restaurants can opt in/out which for cases like GrubHub isn’t possible. Should a manufacturer have the right to say that you can't re-sell something that you bought from them fairly? That doesn't sound great to me. If Doordash fairly buy the food then they can sell it to me (as long as they follow food regulations). That sounds fine, doesn't it?

If the reseller is pretty much pretending to be the manufacturer, and goes on yelp and change the manufacturer's phone number to their own.. I don't know if they have the right, but it's pretty scummy.

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

#230

Post by thrownblown »

pwinnski wrote: post #197
lotsofpulp wrote: post #184

Earlier quoted context omitted.

No one is forcing the restaurant to accept the fee, and if they do, then the restaurant should charge higher prices to offset it. Otherwise google maps and Apple Maps is sitting right there not charging any fees for the phone number.

I think you misunderstand. There are a number of restaurants listed on Yelp in my area for whom the phone number listed is answered by GrubHub. I refuse to deal with GrubHub, so I make an effort to search for a direct number, but it is often difficult to find. I'm not sure how GrubHub is getting themselves set as the primary number for restaurants in Yelp, but it's happening.

maybe it has something to do with GH buying Eat24 from Yelp for stock? ¯\_(ツ)_/¯

actually it was all cash nm https://qz.com/1045776/grubhubs-purchase-of-yelps-eat24-may-...

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