Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Instacart is playing games with its workers’ pay

recode.net

Post reply on HN
Print view View original

151–160 of 371 posts

Re: Instacart is playing games with its workers’ pay

#151

Post by kovek »

l8again wrote: post #25

Before Instacart was on the scene, my brother and I thought of about a similar service. My brother in his college days used to be a pizza delivery driver, so he had the "real world" experience. Over the weekend, I quickly created a simple dropwizard java jar that would take in two variables - number of drivers, and number of orders. Everything else was randomized to be close to reality - such as delivery times, route…

Interesting! You estimated the costs using a small program. Have you ever done this with other ideas? Is there some resources which teaches the best ways to do such estimates?

I've done this before with an excel sheet for a specific business my friend was enthusiastic about. It turned out he would have been alright had he gotten a loan.

Re: Instacart is playing games with its workers’ pay

#152

Post by [deleted] »

matt_wulfeck wrote: post #5

> Instead of the tipping option appearing on the checkout page as it originally had, a default 10 percent “service fee” sat in its place. If I could take a guess, I'd say this is more related to the user experience. I hate tipping. I'd rather just attach a 10-20% fee instead of needlessly evaluating someone else's performance with every delivery. Or better yet, I'd rather just use a company that adequately pays its o…

[deleted]

Re: Instacart is playing games with its workers’ pay

#153

Post by pshposh »

doctorpangloss wrote: post #54
pshposh wrote: post #42

Earlier quoted context omitted.

I didn't realize your comment exclusively pertained to venture owners. Even so a venture owner could sell the company to the employees and move on to their next big thing.

You're right that it's something a venture owner could do. But then, you'd be surprised at how many highly-compensated programmers never bother to exercise their options. The same ones who then go on Hacker News and complain about bad treatment of workers, and how if only they owned the companies.

> But then, you'd be surprised at how many highly-compensated programmers never bother to exercise their options. The same ones who then go on Hacker News and complain about bad treatment of workers, and how if only they owned the companies.

This reads like an oddly specific claim -- do you have examples?

Re: Instacart is playing games with its workers’ pay

#154

Post by ben174 »

malz wrote: post #125

https://www.instacart.com/help/section/200761924#213895126 Why does Instacart use a service amount? Instacart is different than other delivery services because multiple shoppers may be involved in a single order. Some shoppers work in stores, for example, while others are involved in driving to deliver an order. The service amount is used to pay this entire set of shoppers. Furthermore, it helps to ensure that all sh…

The way I read this is "the service fee is a way to give us more money, so we have more money to pay to everyone who works for us". So then why not just raise your prices and pay your employees more?

If the service fee was split across everyone who participated in your individual transaction, I could understand. Otherwise this is just a way of them saying "a service fee is a way to tip the company, so we can maybe pay our employees more".

Re: Instacart is playing games with its workers’ pay

#155

Post by grandalf »

mathattack wrote: post #98
tyre wrote: post #8

They have tens of thousands of customers, yet are worth multiple billions of dollars (valued at $2bn in 2015.) That's just incredible. Let's say they have 100k customers who each use the service every week. That's 5.2m orders per year. Let's say $100 per order, to be generous. At a 10% service fee, that's $50m for a two-year-old 40x revenue multiple. Before paying their contracted workforce. This does not make sense.…

I applaud your willingness to edit. I am bearish on Instacart, but acknowledge that you shouldn't value them based on current cash flows. It's half a bet on massive growth combined with eventual profitability, and half a bet on some massive non-linear outcome. (For example: search -> ads, or books -> hosting)

Imagine if people routinely traveled to a shop and spent 20-30 minutes collecting mail addressed to them, then traveled home. If mail happened regularly enough, this would be a very inefficient arrangement.

Why is grocery shopping any different? Most people buy pretty much the same stuff on a routine basis. Items have varying shelf-life, making parcel shipment practical for only a subset of items (not to mention the hassle of dealing with all the boxes).

Local grocery retailers are essentially market makers for the items they carry. They also provide parking, merchant processing, and a variety of other services (like store brand items, made-fresh refrigerated items, etc.)

Unless you are a chef looking for inspiration or insist on getting the absolute best looking tomato in the whole store, for most people, the time spent trudging through the aisles is mostly wasted.

In other words, the lack of delivery imposes a significant transaction cost upon obtaining groceries. Thanks to Instacart, I buy a lot more groceries than I used to, which means I spend less money at restaurants. Instacart turns grocery stores into a bigger competitor for restaurants.

Unlike Seamless where you pay close to $5 for delivery of a single meal, with Instacart you can order food for a whole week and pay not much more to have it delivered.

Instacart makes keeping the fridge in stock with just the right items significantly easier and removes the immense hassle of manual shopping/transport.

Re: Instacart is playing games with its workers’ pay

#156

Post by lostlogin »

mikeash wrote: post #105
dawnerd wrote: post #94

Earlier quoted context omitted.

I feel like even if they paid their delivery people a reasonable wage they'd still expect tips. Ive had movers that made over 50/hour not including the cost of materials/truck/etc ask for a tip. I was all for Uber being tip free until drivers started driving for Lyft which does tips in-app, and now all the drivers expect it. I've always felt this way with Pizza. Most places charge a delivery fee. That itself should b…

The solution is to pay them better and forbid them from taking tips. Make it clear to customers that it's not even allowed, let alone expected. Unfortunately, I don't think tipping culture is going away any time soon.

The worst part for me - places here in NZ are trying to introduce it. I've solved it by not going back, that that doesn't work if the practice spreads.

Re: Instacart is playing games with its workers’ pay

#157

Post by jquery »

vinceguidry wrote: post #106
nathanaldensr wrote: post #36

When are we as a society going to tire of company executives feigning stupidity and ignorance when it comes to these very deliberate actions ? All these executives--and likely all the developers, too--know exactly why these business model and app changes were made. The reasons given in the article are completely accurate. It can be boiled down to this: Money > People.

I have been reading a lot about Russia and China recently, and I'm struck by just how much more realistic their citizenry is compared to America. I think it ultimately boils down to how real power operates in the countries. The average Russian or Chinese citizen is way less powerful than the average American citizen. If they have a grievance to make, whether it's against a local or national policy, Russians and Chine…

> outrage will be generated and justice will be served.

Trump is the personification of the outrage over illegal immigration, crime, bad trade deals, and the Neocon (globalist) wing of the Republican party.

> liberal Americans trusted the system enough to stop looking to see how it was being used

Umm, what? For over a year, liberal Americans were aghast at the rise of Literally Hitler and made no bones about sharing their opinion on the matter.

Re: Instacart is playing games with its workers’ pay

#158

Post by pshposh »

soheil wrote: post #80
developer2 wrote: post #63

Earlier quoted context omitted.

So Amazon Fresh has an optional tip . Instacart is adding a default 10% fee that goes into their pockets - it is not a tip. And they do not pass the 10% fee on to the employees in wages - it stays as part of their bottom line. Higher-ups realized just how much the tips are worth, are now stealing them by default behind a purposely confusing interface that their customers cannot understand, and pocketing the differenc…

I understand it's not the most conventional way of doing it, but why it's someone "higher up" and that's a bad thing? Instacart is not Mother Teresa, its sole purpose is to make profit and I want it to do that as much as it possibly can. I want this service to exist so I don't have to feel like a chimp in a grocery store with a basket going from aisle to aisle in fact why do I even need to justify why I want it to ex…

Do you believe it is possible for something to be wrong yet legal?

Re: Instacart is playing games with its workers’ pay

#159

Post by grandalf »

tomcam wrote: post #147
grandalf wrote: post #29

Earlier quoted context omitted.

Say the average wage is $10/hour. If it takes one hour to go and do that shopping, I break even by paying someone else that $10, if I value my leisure time as equivalent to my wage. More likely, most Instacart customers earn much more than $10/hour. For someone with a busy work schedule, there might be 2 hours of leisure time available per day during the week. This means that by using Instacart I increase my after-wo…

> More likely, most Instacart customers earn much more than $10/hour. Why do you think that?

I was thinking mainly about the entertainment value of using scarce recreational funds to have groceries delivered, but as someone else in the thread pointed out, there are cases where taking a taxi to get groceries (as I did in college) is actually a lot more expensive than Instacart, so I could see it appealing to an even wider range of people for similar reasons.

Re: Instacart is playing games with its workers’ pay

#160

Post by pshposh »

rahimnathwani wrote: post #110
mrits wrote: post #67

Earlier quoted context omitted.

How could anyone ever know this? Uber doesn't even have this data, since the tip is in cash.

I've seen Uber drivers discuss this on forums. For some drivers, 'no tip' = 'no 5 star rating for the passenger'

What are the implications for a passenger with a poor star rating?
Post reply on HN