During the pandemic, everybody had a price to pay. Some people kept ordering things online, so you might think that the dining places must have earned a lot. However, you need to know that even they had a price to pay. You are curious now! In the article, you shall know how delivery apps gave profit and a challenge to the restaurants. The article will be quite interesting, so hold on to your seats tightly and start reading the article closely.
The current situation
Even though the delivery apps kept the customers in touch with their favorite restaurants, they righteously took their share for it. Even with this long association, the delivery service and restaurants are still struggling for charges, fees, profits, etc. You would be amazed to know that the delivery companies charge around 30% commission from the restaurants. You can understand that what the restaurants must be going through. They are in a constant struggle to maintain the profits. That’s because the home delivery tradition is not going out of trend anytime soon.
The restaurants, in the end, we’re left with no option but to start their service or take a step back from portals like UberEats and DoorDash. However, these companies are trying to keep up with them by negotiating low commissions, etc. Wait; do not be in the misconception that they are making good money. Every coin has two sides, and so does this. Know the second side of the coin.
How is it affecting things?
Delivery companies can profit if the delivery is in the neighbourhood and have several deliveries at one go. Or else, if the delivery person has to travel long distances for single orders, it costs the company an arm. They shall not pay these people from their pockets; they have to take someone in their fold, right? So, it is the restaurant, employees, or the customers.
The challenge
It is a task for these companies to find a way out to make these deliveries profitable. The percentage of people ordering food home surged exponentially during the lockdown. It is predicted that the number shall increase in the following months and years. You will be shocked to know that the ratio of home deliveries doubled in Canada, Russia, and U.S. Besides, Spain, Germany, and France saw a 30% rise in the deliveries, according to the market research company named NDP Group.
Despite the struggle, the companies are willing to shake their hands with the delivery companies. According to a chocolate maker, Jaffray Gardener informed that one loses money on few orders daily. However, they continue to work to reach a vast audience.
Huang, vice president of DoorDash, San Francisco, says that the company is working towards trust-building. UberEats is experimenting with low commissions of almost 5%. However, the irony is that even though the orders multiplied, the delivery companies lost money.
The current situation has put the restaurant owners and delivery companies in confusion. They see the future of the delivery but are trying to figure out how the profits can be shown on the charts.