The surprising amount food delivery apps take from Ontario restaurants when you order
TORONTO -- An association advocating on behalf of Ontario restaurants is pleading with delivery service providers to reduce their commission as smaller businesses struggle to stay afloat amid the ongoing COVID-19 pandemic.
Tony Elenis, President of the Ontario Restaurant Hotel and Motel Association, said that while some businesses established a takeout or delivery service years ago, others are struggling to shift from a dine-in model they have used for years.
“As restaurants are closed and trying to go on the bandwagon …they are not making that much money. Their infrastructure is complicated. They are new to the game,” Elenis said.
Elenis said that many restaurants have been complaining that fees for delivery services are too high, meaning they don’t make enough money off of their orders to finance their operations. He said that restaurants have had to invest in packaging for their food that is more durable, increase sanitation efforts and operate using physical distancing.
He said the commission some restaurants are paying is making it difficult for them to stay open.
“From a business sense, you would want those restaurants to be there post-lockdown period,” Elenis said.
According to Elenis, Uber Eats charges the highest commission among suppliers used in Ontario, taking about 30 per cent of each order for themselves. He wants the company to “come to the table” and temporarily reduce that number to about 15 per cent for the duration of the pandemic.
“They are still making money out of it, just temporarily bring the prices down to give an opportunity for the industry to have a life. It’s like someone drowning in a pool, throw them a rope,” Elenis said. “They need a lifeline.”
With a commission of 30 per cent, restaurants only stand to make $10.50 on a $15 order.
According to their website, Uber says that its service fees equal “15% of an orders subtotal,” and that delivery fees can vary for each restaurant based on customer location and availability of nearby couriers.
In a statement, Uber said they have waived delivery fees in order to help drive traffic to businesses.
"In order to sustainably support our restaurant partners through the evolving crisis, we’ve chosen to drive demand to local restaurants by waiving delivery fees," a spokesperson said. "Uber Eats $0 Delivery Fee is helping generate orders to support our partners as they experience a significant slowdown of in-restaurant dining, which we know is a key concern at this time."
Some delivery providers have reduced their commission or made adjustments to their service to accommodate local businesses as they muddle through the business changes.
DoorDash has reduced commission for all of their local restaurants by 50 per cent, according to a statement on their website. The “commission relief program” began on April 13 and will continue until May. Restaurants eligible for the program must have five or fewer locations. Last month, DoorDash also launched a commission relief and marketing support program for new and existing DoorDash partner restaurants.
In a news release issued on Thursday, Skip the Dishes said they will be offering a 25 per cent rebate program to help local businesses.
Similarly, Foodora is running promotions to help restaurants with their bottom line.
“We frequently run promotions on our platform together with our vendor partners, including free delivery, discounted menu items and other marketing promotions,” Foodora said in an email to CTV News Toronto.
Despite that, Elenis hopes that all delivery providers are willing to have a discussion and “listen to customers” when it comes to supporting Ontario’s restaurants so they are still able to operate when the pandemic runs its course.
“There is going to be a transition where we are going to go through post-lockdown and pre-virus cure. That will be a gradual transition and they will need some support through that time,” he said. “The industry will always remember those who have not been kind to the industry.”