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Local restaurants push for a cap on food delivery app fees in Santa Clara County

Original post made on Nov 30, 2020

Santa Clara County business leaders are pushing for a cap on fees charged by food delivery companies like DoorDash and Uber Eats, calling the costs exorbitant at a time when restaurants are struggling to survive the pandemic.

Read the full story here Web Link posted Monday, November 30, 2020, 4:49 PM

Comments (6)

21 people like this
Posted by Online Name
a resident of Embarcadero Oaks/Leland
on Nov 30, 2020 at 5:28 pm

Online Name is a registered user.

Way overdue! Such sleazy practices built into their business model where they rip off their customers and their gig workers.

Web Link

"DoorDash is paying $2.5 million to settle a lawsuit that accused the company of stealing drivers' tips Wed, November 25, 2020, 3:21 PM PST

DoorDash is paying $2.5 million to settle a lawsuit filed in 2019 that accused the food delivery company of using a "deceptive" tipping model.

1 person likes this
Posted by Midlander
a resident of Midtown
on Nov 30, 2020 at 6:23 pm

Midlander is a registered user.

I am rather startled that the County feels it can suddenly impose caps on fees or charges. Perhaps if they are going to do this, they might better start by telling Starbucks to only charge me $1 for a latte or tell my dentist to only charge me $50 for a filling? (And no, I'm not serious.)

Doordash, UberEats, etc, are all normal profit-driven commercial operations. They compete very aggressively with each other and they seem to be meeting a real market need. I don't know what their current economics are, but for a long while they were substantially subsidizing every delivery in order to build market share and it was clear that couldn't last. In the long run, consumers will need to pay a fair price for the food and the delivery costs and the restaurant and delivery companies will have to figure out compromises so they both can make a profit. Expect some unhappy screeching from all concerned along the way.

Dear County, this is all kind of normal. Please don 't leap in to the middle of it!

25 people like this
Posted by Lee Forrest
a resident of Crescent Park
on Nov 30, 2020 at 6:30 pm

Lee Forrest is a registered user.

> "Restaurant owners say the fees average 30% of the cost of orders and run as high as 50%."

^ All things considered, 50% is a tad on the high side.

3 people like this
Posted by Orchards
a resident of Palo Alto Orchards
on Dec 1, 2020 at 10:06 pm

Orchards is a registered user.

Missing from this article is a clear explanation of the fee structure, how fees get to reach the higher percentages quoted in the article, and the proportion of orders that actually have such fees. Is 45% fees from very small orders, where delivery doesn't make much sense unless there's some fixed amount charged? And do fees reach that high for half of all orders, or only for 1%?

As written, this article is low on data and content, and high on outrage manufacturing. We're smarter than that, and deserve better information.

7 people like this
Posted by Native to the BAY
a resident of Old Palo Alto
on Dec 2, 2020 at 12:16 am

Native to the BAY is a registered user.

App based delivery service workers (using their personal vehicle) are treated like a metaphoric mule. They get a sugar cube when they deliver on time and severely scolded on both sides when late. What a gross injustice to labor . Also. reminds me of human taxis running barefoot in Asia with rich Americans as riders — thanking the service by not tipping . What a hitched up scam.

3 people like this
Posted by Resident
a resident of Midtown
on Dec 2, 2020 at 4:09 am

Resident is a registered user.

All these apps -- Doordash, GrubHub, Ubereats, and a the various upstarts are parasites.
They follow a trend of designing an automatic system governed by AI, while they expect to sit on their ass getting paid as the app does all the work for them.
This seems to be entrepreneurship these days: come up with an app, do nothing, get paid. Try to get a new job without some employer leaning entire on an app to run the company for him.
They will send drivers on $3.00 taco bell runs with $0.00 in tips. The driver depends on tips to cover gas and expenses but there is no mechanism at all in the app to make sure the driver is properly compensated.
There is no minimum. No one should ever drive a car to bring you a $5 KFC meal. Yet the delivery apps allow this. No one should drive for them. The people who sit in their insulated rooms designing apps should instead invest in their own fleet of delivery vehicles or else deliver the food themselves in their own damn cars.
Exploiting desperate, uninformed drivers and bleeding them of their gas money and wear-and-tear repairs is a destructive, parasitic business model.
If you use any of these apps you better give at least $10 in tips.

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