Hefty Commissions, Increased Disconnect – Corvallis Talks Doordash et. al.

Limits on gatherings and restrictions on services led to the shutdown of many onsite places to eat, but did not altogether halt business. Instead, there has been an increase in pick-up and delivery options, often through a third-party delivery service such as Doordash, GrubHub, or Uber Eats. However, there are some aspects that leave restaurants questioning if these partnerships are worth the price.  

Tristan James, the owner of New Morning Bakery, partnered with Doordash, GrubHub, Uber Eats, Munchies, and We Deliver Eats.  

“Curbside pickup works much better for us. People can order from our website, or call us, and we can easily customize what they want when dealing directly with the customer,” James said. “The third-party systems remove the connection between the business and the customer, making it hard to make sure the customer is happy.” 

James explained that one of the ways this was especially difficult was in regard to delivery timing. He said calls come in from upset customers regarding delivery delays that were not caused by restaurants, but rather by the delivery company’s inability to find a driver. This can happen frequently when a third-party service hires drivers who are independent contractors. 

“The customer often seems to think that we have more control over these orders than we do,” James said. “Google also allows these companies to purchase advertisements on our google listing with links to them for ordering without our permission – the listing is owned by Google after all – so the customer is often misled into thinking they are ordering directly from the restaurant.” 

He found that one of the perpetrators of that problem is Yelp. 

“Yelp lists us without our permission, and then allows these third-party companies to take orders of our products on their site also without permission,” he said. “And because it is done through the Yelp site, the customers think that they are ordering directly from us, but instead it is actually from GrubHub.”  

Benchwarmer’s Bar & Grill has also partnered with delivery services that include GrubHub and Doordash. Drew Hutchinson, a manager, said the reason they were able to stay open for service during the beginning of stay-at-home orders was due to the orders placed using these services. However, Hutchinson also said that while Doordash is getting better, drivers may not show up. As with New Morning Bakery, customers would call about their orders being late or not arriving, unaware that the eatery had little to do with the actual delivery.  

Small Business, Big Money 

GrubHub touts that they provided nearly $6 billion in gross food sales to local takeout restaurants in 2019. 

However, the commission charged by any of these companies makes a profit unobtainable. On their website about me page, Doordash says they are a connecting point with restaurants, that they help local businesses and generate more income for the community.  

Yet, Doordash recently changed their payment policy from a system that guaranteed a base amount of money for a delivery, using tips earned by the driver to subsidize the base cost. This meant that all tips that went to the driver, or Dasher, actually went to the company and the company then used those tips to pay Dashers their wages. No matter how high or low a Dasher was tipped, they would get paid the same amount. Now, the company increases a Dashers’ wage by the same amount of money they earn from tips, but their new guaranteed payment is lower.   

Non-Partnered Partners 

Brooke Dale, one of the owners of WiseCracks Café, said the 30 percent commission was the reason she decided not to use any third-party delivery services. She said the beginning of the pandemic was an “odd few months,” and that she even hired her daughter briefly as an in-house delivery service rather than sign up with a delivery company.  

Despite that, you can still find WiseCracks Café on GrubHub, listed under their old name Broken Yolk Café. Dale did not know it was listed, but said occasionally they got drivers with that company looking for a food order. She said customers could use the site if they wished, but expressed concern over confusion it may cause.  

This is not the first time GrubHub has done this. Just in February, they were called out in a letter written to shareholders for doubling the count of business partners by adding 150,000 non-partnered restaurants to their site. They continue to do this, often messing up along the way.  

GrubHub made a statement to WILX news saying that, “Starting in late 2019 in select cities across the country, we’ll add restaurants to our marketplace when we see local diner demand for delivery so the restaurant can receive more orders and revenue from deliveries completed by our drivers.”  

They went on to say that adding popular local restaurants without their consent was a business model and used by competitors. GrubHub claimed they wanted to see if they could use the same strategy to get more business through their service, as opposed to any other service.  

While the company does go on add that it supports legislation to prevent restaurants from being added to delivery sites without their consent, GrubHub did not apologize in its statement. It only listed a contact for eateries to request to be removed from their site or have their business hours or menu corrected.  

Block 15 has yet to see that statement in action. It was added to GrubHub’s site without consent and the restaurant remains there today.  A spokesperson reports that though GubHub has been asked “numerous times” to remove the restaurant from their website, they have not complied. Block 15 has its own delivery service, and asks that customers use that over GrubHub, as it cannot guarantee quality of service otherwise.   

A source at a restaurant in Albany also said that GrubHub in particular is not welcome at their restaurant after a driver claimed the order price was wrong and refused to pay. This left the restaurant losing around one hundred dollars on a single order.  

James says the only reason he continues to partner with these companies is because they consider the money lost as being spent on advertisement. 

Mistreated or unhappy delivery drivers do not bode well for decent delivery service, and poor delivery service can result in restaurants dealing with unhappy customers that do not understand that their delivery service is not connected to the eatery they ordered from. 

Third-party delivery systems are profiting wildly off of arrangements that help mainly themselves while the financial impact of the coronavirus is devastating for many restaurants. It may be worthwhile to consider curbside pickup or a restaurant’s own delivery service to better help local favorites to continue to serve the community.  

By Hannah Ramsey