Toronto food delivery apps are raising their fees and restaurants aren't happy
Delivery app fees that had previously been capped are rising again as restaurants reopen, and owners aren't happy about it.
As part of pandemic-related orders, delivery companies like Uber Eats were ordered to temporarily cap their service fees; but now that indoor dining has reopened, the cap has been lifted.
Uber Eats tells blogTO that restaurants were informed it would be lifted once health officials allowed indoor dining, and emphasizes that this is not an increase in fees on the platform, and also that fees are determined by factors like whether a restaurant uses its own staff to deliver.
Luke McCann, one of the owners of burger joint Rudy, feels restaurants were not as adequately informed as Uber says.
"Our Uber fees went up from the legislated amount on July 15 without giving us any formal notice," McCann tells blogTO.
"Obviously there is no great time for delivery app fees to go up but this comes at a time when our product costs are going up, including produce, paper goods, chicken, bacon and more."
Jahan Carluen, owner of Asian-inspired comfort food spot Nozomi, was a little more prepared for the end of the cap but echoes McCann's concerns about other restaurant costs that are still higher than normal despite the reopening of indoor dining.
"We expected the delivery commission caps to expire," Carluen tells blogTO, continuing, "Cooking oil prices have more than doubled in seven months. The prices of chicken and tuna have risen 15 to 30 per cent as well."
When Ontario entered Step 3 on Friday, July 16, DoorDash lifted their price controls the next day.
"Price controls have numerous unintended consequences and with restrictions lifting in Ontario, restaurants have the freedom to choose the options that work for them," a DoorDash spokesperson tells blogTO, saying they "remain focused on working with policymakers to reach solutions that support restaurants, customers and Dashers."
Tan is already exploring that freedom to find options that will hopefully work better for him than working with delivery apps.
"We have already looked into setting up our own delivery to supplement what we pay out to the delivery apps," says Tan.
"We have implemented a delivery system where we pay a driver $4.50 and the customer pays $4.50, which will help our bottom line. We are also going to set up more pickup order incentives."
Toronto's restaurant owners want their businesses to thrive as restrictions loosen, but based on the effects of the pandemic, some of them feel removing the commission cap for delivery apps has come too soon.
"All facets of the service industry are understandably trying to catch up," says Carluen.
"We just hope that the government fully understands that ending the lockdown doesn't end the effects of the lockdown."
Hector Vasquez at Rudy
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