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

oregonlive.com

471–480 of 580 posts

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

#471
post #278

Earlier quoted context omitted.

If food delivery services suspend service in Portland tomorrow, I would find it pretty hard to believe it isn't political maneuvering to prevent other localities from doing the same.

They won't stop delivering in Portland, they'll just stop delivering to certain areas that are more out of the way.

Or just be more transparent and charge a higher delivery fee.

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

#472

Earlier quoted context omitted.

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.

If you aren't being paid hourly, this is utterly fallacious.

If you are being paid hourly, you should be billing for thinking while walking down the street or taking a shower. That is some of your most productive time.

Also as another commenter mentioned, cold food. Furthermore, avoiding all of the extra zero-use plastic waste they throw in the bag by default.

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

#473

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…

The problem is that this response is in the wrong direction. By forcing prices lower, we guarantee that only over-capitalized predatory businesses can compete in the space. The problem is that consumer advocacy and anti-monopoly are practically the opposite thing. The end result of government action here should be short-term higher prices to the consumer, that reflect the actual cost of operations, rather than lower…

They aren’t forcing prices lower. The companies are free to charge a higher delivery fee.

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

#474

Earlier quoted context omitted.

To some extent this seems like grandstanding. They charge a delivery fee. If the delivery fee doesn't cover delivery, then charge a higher delivery fee. That comes from the customer, not the restaurant.

And base that delivery fee on distance between the restaurant and the customer as well. They can solve it they want to. People in treasure might be willing to pay a higher fee than to not get any delivery at all. It’s political posturing and pressure tactics.

In that other fold of the multiverse, the headline could be that uber is charging people extra in Treasure Island, which contains a lot of subsidized low-income housing.

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

#475

Earlier quoted context omitted.

Another, probably cleaner way around this information asymmetry is the reviews that already exist on these apps. If you order a $24 pizza and something the quality of Domino's arrives at your door, you're not going to enjoy that place and you're not going to rate it very highly. There are plenty of problems with review systems, but there are problems with price caps too.

Are you attempting to explain why we don't see restaurants offering free shipping while rolling the cost into the food price? Because we do see this happen, which suggests to me that reviews are not effective enough in practice to overcome the perception advantage of the information asymmetry.

No, I'm suggesting that, to the degree that customers suffer from delivery fees rolled into prices, that should be reflected in reviews. Pricing isn't determined entirely by ingredient cost, so there's nothing inherently wrong with a $24 pizza A that has cheaper ingredients than an $18 pizza B (maybe Mr. A is just better at making a pizza). What matters is that the customer feels like the value they're getting from pizza A isn't dramatically misaligned with its cost (incl the delivery fee). This is the kind of thing that reviews do capture.

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

#476

Earlier quoted context omitted.

We don't even let health insurance to charge people different rates based on pre-existing conditions anymore, which is what drove health insurance premiums through the roof.

The whole reason for health insurance in the first place is for healthy, wealthy, or young people to pay for unhealthy, poor, or old people. That’s the whole reason for any kind of insurance. It’s a mechanism for lucky people to pay the costs of unlucky people. And even lucky people pay for it it because you never know how your luck will change. If you take your idea for a pricing model to the extreme, everybody pays…

The difference is statistically, most people are going to get old. Lucky is if you either don’t need insurance when you’re young or you live to be old.

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

#477

This is the right move - local restaurants are hurting and, sadly, the internet is a place where big corps with large budgets have leverage over passionate little guys working their butts off. For those who want to help, I built a chrome extension similar to Honey that shows a local restaurant's direct ordering website as you're about to order from that restaurant thru a third party service. If direct ordering isn't…

(Preface: I'm sure your app filters for stuff like this) I got kinda burned when I tried to order direct from a restaurant. The last time we ate there they included a little "order online" card with a link to their website. So the next time, in the spirit of supporting businesses directly, I went to their site and ordered. They did use a third-party handler (ChowNow I think?), but I figured it was a kind of order man…

I have actually seen quite a few restaurants do this, where they use a third-party ordering system but then delegate to DoorDash/GrubHub for delivery. Is it maybe because the delivery service gets a smaller cut in this case? I wonder if the total fees add up to a smaller number with the two middlemen than with only DoorDash/GrubHub. Presumably, the latter can charge more if they also handle the transaction as well as bring traffic, as opposed to only handling delivery.

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

#478

This is the right move - local restaurants are hurting and, sadly, the internet is a place where big corps with large budgets have leverage over passionate little guys working their butts off. For those who want to help, I built a chrome extension similar to Honey that shows a local restaurant's direct ordering website as you're about to order from that restaurant thru a third party service. If direct ordering isn't…

(Preface: I'm sure your app filters for stuff like this) I got kinda burned when I tried to order direct from a restaurant. The last time we ate there they included a little "order online" card with a link to their website. So the next time, in the spirit of supporting businesses directly, I went to their site and ordered. They did use a third-party handler (ChowNow I think?), but I figured it was a kind of order man…

That happened to me as well here in AZ. There is a popular local cookie place that we wanted to support. Ordered a dozen cookies from their website thinking it would put more money in their pocket vs ordering from DoorDash. However, the entire delivery process was DoorDash done all via SMS. It was odd.

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

#479
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.

When I take a flight, I don't demand to know how much the airline is paying the pilots and flight attendants. When I buy food from a restaurant, I don't demand to know how much the restaurant is paying the waiters and cashiers. I also don't know how much the restaurant paid for the food they cooked. That's true of any company/workers/suppliers. People only know and care about how much they end up paying. As long as t…

I don't think that's a good analogy because having a pilot or not is not optional.

A better analogy would be extra baggage. I appreciate being able to save $25-$50 in domestic flights by not bringing an extra bag.

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

#480

Earlier quoted context omitted.

This is maybe a reasonable argument for lunch on a workday, but doesn’t really apply for dinner or on weekends. There’s a counter argument to be made that for many people their productivity and creativity increases when interspersed with a bit of walking, change of environment, sunlight, etc. Anyway it’s largely a matter of preference. There’s are certainly occasions where it’s nice to relax and order door-to-door de…

Don't you see? My time is too valuable to do anything vaguely unpleasant. The entire economy would suffer if I had to pick up my own food.

I'm probably going to get downvoted for this, but yes - that's spot on. It's exactly that kind of attitude I've seen far too often in the culture of well-paid tech workers.

Their lives are all about optimization of time resources / time management, and everyone should bow to their needs - if it results in them shaving off some minutes here and there.

After all, they're making $300k/year working on important products, so it's only natural that every corner that could be cut, should be cut - even if it means driving people out of business.

When confronted with the logic, they regurgitate the same "But you see, my time is worth $xx, 24/7/365 - so 30 mins saved on task x is a net profit for me" (even though, in fact, they would not be working during those 30 minutes)

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