What DoorDash pays, after expenses, and what’s happening with tips • Hacker News Board

Re: What DoorDash pays, after expenses, and what’s happening with tips

#211

Post by TAForObvReasons » Fri, Jan 17, 2020, 7:46 AM UTC

Sevrene wrote: post #175

dmode wrote: post #160

Why can’t we have normal businesses where you employ your workers and charge your customers the real cost of the transaction ? If that is not viable, don’t start the business to begin with. Let’s just go back to first principles, can we ?

This is just a natural outcome of the way venture capital funding works at the moment. When you care more about speculation than what's actually fundamentally occuring, you're going to get businesses funded that are not even able to survive on those basic fundamentals. If it weren't backed by large capital, it couldn't exist. This isn't always a bad thing, but on a whole, it does distort the market. At some point you…

I thought the plan was Dumping https://en.wikipedia.org/wiki/Dumping_(pricing_policy)

Step 1) Use VC money to subsidize the price so that the market price is below cost

Step 2) Continue to use VC money to subsidize while competitors, who don't have the same cash, lose customers and eventually contract or die off

Step 3) Once you are the only real player, use your dominant position to raise prices

Re: What DoorDash pays, after expenses, and what’s happening with tips

#212

Post by onion2k » Fri, Jan 17, 2020, 7:57 AM UTC

marcell wrote: post #30

> “These orders don’t pay for our expenses or our time. We actually lose money when we take those orders. If I pick up an order that is 10 miles away and deliver it 6 miles I’m traveling 16 miles for a $3 order — so I have lost money. I’m in the negative when I account for gas, wear and tear, and other expenses. Not to mention my time.” This begs an obvious question: why are people choosing to do this if it pays $0/h…

It'd be much more efficient for DoorDash to work out when a job isn't viable for the driver and either increase the price or refuse to take it.

Re: What DoorDash pays, after expenses, and what’s happening with tips

#213

Post by wolco » Fri, Jan 17, 2020, 7:58 AM UTC

franga2000 wrote: post #199

2rsf wrote: post #192

Earlier quoted context omitted.

Yes we can, that's how it works in Sweden and AFAIK in many other European countries. Tips are not expected, and are meant only for extraordinary service. The base pay is decent and so are the benefits like vacation, pension etc.

Is there any other country other than the US where paying service workers below minimum wage is legal or acceptable? I've been around a fair bit of Europe and surroundings and I've never encountered the US system.

Canada, Africa and the Middle East.

Re: What DoorDash pays, after expenses, and what’s happening with tips

#214

Post by abandonliberty » Fri, Jan 17, 2020, 7:58 AM UTC

TAForObvReasons wrote: post #211

Sevrene wrote: post #175

Earlier quoted context omitted.

This is just a natural outcome of the way venture capital funding works at the moment. When you care more about speculation than what's actually fundamentally occuring, you're going to get businesses funded that are not even able to survive on those basic fundamentals. If it weren't backed by large capital, it couldn't exist. This isn't always a bad thing, but on a whole, it does distort the market. At some point you…

I thought the plan was Dumping https://en.wikipedia.org/wiki/Dumping_(pricing_policy) Step 1) Use VC money to subsidize the price so that the market price is below cost Step 2) Continue to use VC money to subsidize while competitors, who don't have the same cash, lose customers and eventually contract or die off Step 3) Once you are the only real player, use your dominant position to raise prices

In many cases they may find the price cannot be raised enough to generate profitability, and the service can really only exist in a speculative VC-funded bubble.

Re: What DoorDash pays, after expenses, and what’s happening with tips

#215

Post by randomsearch » Fri, Jan 17, 2020, 7:59 AM UTC

burlesona wrote: post #67

What I struggle with is why anyone would deliver for Door Dash if the pay is so bad. The article closes with a statement that they want $15/hour plus expenses for drivers. The obvious problem is that I can’t see customers paying that much for delivery - ie. at those wages Door Dash can’t exist. The fact that people choose to do the work makes me think there are people who find it worthwhile, and I can explain a few s…

I think it’s hard for HN peeps, who I would guess are mostly comfortably off, to empathise with those involuntarily stuck in the gig economy. It’s not likely to be a rational calculation but rather “I desperately need cash today, what can I do?”, that is an entirely short term decision. And if you’re stuck there, then companies can continually exploit you unless the government steps in to protect them. See also: payday loans.

Re: What DoorDash pays, after expenses, and what’s happening with tips

#216

Post by abandonliberty » Fri, Jan 17, 2020, 8:02 AM UTC

savanaly wrote: post #176

vector_spaces wrote: post #161

Earlier quoted context omitted.

I've worked these gigs before, and so have friends of mine with advanced STEM degrees. Sometimes you are stuck between a rock and a hard place (usually you are, if you're low income) and your current dilemma is between not being able to afford your rent tomorrow or food tonight, and working some exploitative app gig like this. So cool the condescension. Poor folks -- even those with really low numeracy -- are general…

None of all of what you wrote addresses how those folks between a rock and a hard place will be better off not having the option to work for a given service at all.

There's something wrong with this statement because prostitution can be substituted as your suggested service.

Re: What DoorDash pays, after expenses, and what’s happening with tips

#217

Post by jiofih » Fri, Jan 17, 2020, 8:02 AM UTC

darawk wrote: post #206

CaptainZapp wrote: post #169

Earlier quoted context omitted.

Ahh, what you lose on every transaction you make up in volume. Got it!

No reason to complain when you're the one picking up the unit loss, though. Might as well take it while you can.

Unless you care about not fucking over your fellow citizens to get free food deliveries?

Re: What DoorDash pays, after expenses, and what’s happening with tips

#218

Post by kangaroozach » Fri, Jan 17, 2020, 8:02 AM UTC

Sophisticated companies preying on unsophisticated small businesses (workers). This is the same garbage that convinced many businesses that selling Groupons was good for them when clearly it wasn’t. The same thing that gets drivers to exchange the equity in their vehicle for money while giving away their time for free. They optimize their business models and pricing to take the most advantage of an endless pool of desperate individuals just seeking to get by. Meanwhile well regarded VCs and celebs get rich before the entire model inevitably proves to be bogus. It’s a total scheme.

But stealing tips is as low and unethical as it gets. By definition a tip is a direct payment to the service provider. Even pooling tips is not ethical. But literally stealing tips is false advertising. They are selling tips and delivering something else. Call it something else, but if you call it a tip and don’t pass 100% to the delivery person you are an unethical person. And this is coming from a free market capitalist.

Re: What DoorDash pays, after expenses, and what’s happening with tips

#219

Post by bubblethink » Fri, Jan 17, 2020, 8:03 AM UTC

I recently discovered that doordash also jacks up the prices of items. $7 sandwich = 7 + 2 in markup + 2 in delivery/service fees + 2 in tip if you tip = 13. So you pay roughly twice the amount and everyone is unhappy at the end other than doordash. How is this business model still working in the US ?

Re: What DoorDash pays, after expenses, and what’s happening with tips

#220

Post by jiofih » Fri, Jan 17, 2020, 8:04 AM UTC

ramraj07 wrote: post #203

gvjddbnvdrbv wrote: post #179

Earlier quoted context omitted.

Because people still want food cooked and delivered and to use taxis. If the non financially viable companies did not exist then financially viable ones would.

Not completely. I remember life before Uber and seamless. I'd just stay home and eat ramen (this is in Dallas and I didn't have a car). These businesses did genuinely create businesses and also changed lives for many by the service. That's not an excuse for such exploitative behavior of course.

That has a lot more to do with the tech and distribution model they unlocked than financial viability. In Europe Uber drivers are private (company) drivers, not contractors, and it still works. There is a ton of money in transport, Uber is not even cheap if you’re not in tech / top earners.