Uber Eats et al

Does anyone have the straight skinny on all the ins and outs of the money flow for those food delivery services?

I haven't paid any attention to any of them because we live far enough out that most places don't deliver to us, but due to a recent surgery my daughter got us a credit to an Uber Eats account to use.

When I went to the webpage to order the food the delivery charges were listed and depending upon which restaurant I ordered from they ranged from free to $5.99.  Not bad I thought.

I had recently seen some posts in some of my FB groups from delivery drivers telling people they only got from $2-$5 for a delivery so if you weren't going to tip big to please not order food so I knew a big tip was in my future on top of the stated delivery charge.

But back to the restaurant web page, the prices looked suspiciously high so I compared it to the restaurant web page that I found using a search engine.  Same look, same dishes, but prices that were from $3-$5 cheaper.  For us that meant our real delivery charge was $21 PLUS the $3.99 stated delivery charge!

Definitely not truth in advertising!!

Also I've since found out they charge the restaurant up to 35% of the order for the privilege of having it delivered.  That means they are making much more money than the restaurant who does all the work.  And the poor delivery driver is getting soaked if you aren't in a residential neighborhood close to the restaurant.

While I have no problem with the service making money, but I do have a problem with the obfuscation and outright lying about the delivery charge.  Just tell me how much I am paying and then I can decide if I'm willing to pay it.  Don't lie about the delivery charge and hide the real costs!

So does anyone have real numbers on how much it costs the consumer to use these services. I understood it during the quarantine thinking it benefited the local restaurant. never knowing they were getting taken too.

Not sure, but I really find any gift cards annoying. Not because of the lack of thought, but because it is so much easier for all involved to either just give cash/check, or to tell someone you're taking care of dinner and then make it or buy it for you. 
 

Instead, you have to figure out what the berkeley it is that you want to eat at (random restaurant) that is under $25 delivered...

I have a feeling that the upcharge is associated with the restaurant fees, and the fees are directly proportional to the volume the restaurant pulls. 

I try not to use these delivery services due to a $10 dish running me $30. My dad is a chef at a local fast-casual restaurant and he says the delivery drivers often get impatient (which, to be fair, is because they want to get tipped well) but he literally can't do anything when it's the 50th order in the queue and he's just getting to #25. He's not a fan of them, to say the least. 

Anyways, he has told me that the owner said the fees are pretty exorbitant and DoorDash charges the most. I believe his restaurant only deals with Postmates. 

I can try and poke for more info, later. 

We stopped using UberEats when we lived in the city because their delivery charges got stupid.

I drove for them as a side gig, it wasn't bad money 20ish after expenses an hour

We typically only use Postmates if we are busy doing stuff around the house and it's worth the fee to not dirty up the kitchen as we are cleaning, or if we've had a few adult beverages. So obviously not responsible to get behind the wheel. 

It's nearly universally unkind to the restaurant, and you pay more per dish, as you found. I usually skip them and call the place and do take-out. Now some of the places know me by name, and I giggle watching the impatient delivery drivers sitting there.

It's almost like Uber is not a good company.

Had to take an Uber this morning, so I figured I would ask my driver.  The cost of the dish goes to the restaurant.  The delivery fee goes to Uber, and only the tip plus a small fee goes to the driver.

I just made a fake order in DoorDash that looks like this:

Now... glazing over the fact that this $17.93 meal would be $5 if you just went to the drive-through yourself, take a look at all the extra.  The total for your $5 meal is eighteen dollars.  Since this Dash would be close to me, and not very valuable, the driver would get $2 from door dash plus the $2.50 tip. (if I even left a tip, which I would, cause I'm not a jerk)  The driver would pocket $4.50 before taxes.  The benefit to the restaurant is that they get to upcharge on a meal that actually costs them less to do (no cashier labor needed for online ordering).

So, in this particular order of $18:

Mcdonalds gets $7.89 (which is a $3 bonus by comparison)
Driver gets $4.50
Uber gets $5.54

Basically, you paid $18 for something that should have cost $5, and it cost the store $2.  The rest of the money goes to DoorDash and a pittance to the driver.

Extrapolate those numbers over the fact that Door Dash had 816 million orders in 2020.

hunter47 said:

I have a feeling that the upcharge is associated with the restaurant fees, and the fees are directly proportional to the volume the restaurant pulls. 

I try not to use these delivery services due to a $10 dish running me $30. My dad is a chef at a local fast-casual restaurant and he says the delivery drivers often get impatient (which, to be fair, is because they want to get tipped well) but he literally can't do anything when it's the 50th order in the queue and he's just getting to #25. He's not a fan of them, to say the least. 

Anyways, he has told me that the owner said the fees are pretty exorbitant and DoorDash charges the most. I believe his restaurant only deals with Postmates. 

I can try and poke for more info, later. 

I wish you would get more info.  This is downright dishonest the way it's worked.

In reply to Curtis73 (Forum Supporter) :

According to the restaurant that I used, the upcharge goes to Uber not to the restaurant.  They don't even know what Uber has charged us, they only know they get a reduced fee for the meal.

Which means Uber is pocketing the difference between the discounted meal cost and the upcharged amount.

So in my case they would have gotten $21 + whatever the discount is.  And that's part of what I'm wondering about the dollar figures.

In any other industry disclosing one fee burt actually getting another would be illegal.  You have to disclosed the true cost of the delivery fee and they are not.

I don't know about DoorDash but Uber was definitely making money but not as much as you'd think when I was driving. $5 isn't a lot but when most deliveries take under 10 min total it makes a difference.

It was a decent side gig when the weather was too cold to do concrete, I've had worse jobs then sitting in a warm car listening to music and getting $20 an hour or more.

The person that gets screwed though is the person getting the order, drivers get paid, restaurant gets paid and Uber got paid

Any of the restaurant owners I have talked to about it say it costs them a fair amount of money out of pocket.  It's possible they just don't want to bump their price to cover off the cost.

I generally try to search out the website or phone number of the actual restaurant and buy direct, then pick up. 

There is something about Doordash and the like that just bothers me.  

1:  Learn to cook.

2: Put down your game controller and go out for supper.

3: Learn to be a cheap prick like me.

Buddy drove for the big 3 for a while last year. Did alright in the beginning, upwards of $1,000 a week. After a couple months got down to 2-3 orders per shift.

It's insane the amount of money people will spend on garbage.

A berkeleying large drink from McDonald's, $10 after tip. Nevermind the people ordering lived within walking distance of a convenience store. And that was a regular occurrence. Like multiple times a week, all over town. 

I've looked into it on lazy days, nobody delivers to me without a 2 plus hour wait. Not worth it, especially with a markup on food and all the extra fees. 

What kills me is a couple pizza places only offer delivery through one of the apps, but at least they waive the delivery fee after like $15. Except, if there aren't any drivers in the area, the pizza place no longer delivers. It's still faster to call ahead and go pick it up myself than wait for them to bring it to me. 

One of them, you can use it to order pickup. I did that for a while with one restaurant because, for whatever reason, our 2 favorite dishes were cheaper on Doordash (or uber? Not sure) than they were at the restaurant. 

There is really only one restaurant I ever get delivery from though. I just can't stomach the extra $10 to save myself 10 minutes of driving. 

In reply to carguy123 :

OOoooohhhhh.  Have to dig into that

I also did speak to an Uber driver for a longer trip a few months ago.  I was paying attention to his phone as it kept popping up Uber notifications for new fares in the area.  He mentioned that it's all AI.  The number of fares you're offered (and both their distance from you and distance of the fare) are calculated by your habits and activity.  If you're a fare whore and you'll drive 20 miles to pick up a fare, you'll start getting tons of notifications, even when you're on a current fare.  Ever call for an Uber and it links you to a driver and says "finishing up another trip," followed by "ETA 20 minutes."  That's a fare whore (his words).  Just taking whatever pops up.  He said it unfairly skews the fare offers to the full-timers like him, while part timers can sit for hours and not get a notification.  The people who win Jeopardy are the ones who have mastered when to hit the button.

I also had an Uber driver from 2 hours away in Philly.  She said she travels everywhere picking up Uber and Lyft fares.  It took her 6 hours to get to Harrisburg (me), then she just kept taking fares to the west of her location.  She estimated she would be in Pittsburgh in a couple days if she could find some fares in the rural parts between.

I would assume they can't go over state lines, or at least they can't pick up outside their home state?  Seems like that would be a tax issue.  I know that the taxes are based on where you're picked up.  Like if I get a taxi at JFK and have them take me to Newark, it's considered a NY fare, but then the driver can't pick up another fare until he's back in NY, right?

Yeah the services are pretty E36 M3ty for restaurants and they are super slow around here and add a lot of cost to the meal. 

The only time I use them is if I have nothing around the house and my wife is out of town and I am watching the 1 year old.

Restaurants pay a 30% commission to Uber. But fast food restaurant profits are only 6-9% on average. (McDonalds tops the list at 20% profit margin).  So, restaurants are selling at a loss when they allow subcontracted delivery services.   They can't survive that way, so they change their online prices.

THEN customer pays Uber a 15% delivery charge, plus a small delivery fee if it is under $10. 
 

It's not actually deceptive. It's open and honest. Online price from the restaurant is more than in person, AND there is a delivery fee. 
 

Uber is making a killing, but the person to blame is actually the customer. They don't want to make a trip to the restaurant on the corner. There IS a cost, even if the customer THINKS it's free. 
 

When we insist on free stuff, we just pay in alternative ways. 

It's almost like the gig economy is pretty crappy.

Paul_VR6 (Forum Supporter) said:

It's almost like the gig economy is pretty crappy.

It's fine if that's what you're looking for. What I don't get it all the "rah rah gig this, gig that" and then "where are my benefits?". Mutually exclusive, those are.

And I stand by what I said earlier, which Carguy123 pointed out, they are universally bad for the restaurants.

Back in the mid 90s, I was spending a lot of time in hotel rooms and thought that it would be awesome if I could just call someone up and have them bring me food from anywhere.  But as I thought about how much I'd have to charge per delivery to make it worth my time, I realized that I would never pay that kind of money when I could just take a quick drive and, thus, the idea was stupid. 

A couple years ago, my wife heard stories of people making relatively significant amounts of cash with Doordash and gave it a try.  She didn't want to work it like a job so she stopped after a short while. In that time, though, I think the delivery that blew my mind the most was the woman who ordered a Chipotle burrito from the store that was about a 5 minute walk from her apartment.  All-in, the $8 burrito cost her more than $20.  To save a 10 minute round-trip walk on a very pleasant autumn day.  I just don't get it.

The only situation that I really see that as being a worthwhile service is in a business context where you really are buying time.  Paying $100 to get 5 people some burritos can be a very cheap option in terms of the goodwill that it can buy and the fact that you can squeeze an extra meeting in to the day.

One of the practices that at least one of those outfits employs is to set up a new phone number and website for a restaurant and then charge the store every time that number or website gets used.  Any time I'm going to call for take-out or even just for a question about their hours, I'm always very careful when I search around for a restaurant's phone number.  In some cases, they will start taking orders for a restaurant before the place has agreed to it or is even aware and then they'll come back and use that as leverage to get them to sign on.

Paul_VR6 (Forum Supporter) said:

It's almost like the gig economy is pretty crappy.

As a person who has made almost his entire career as an independent contractor, I'll just say that I wouldn't have it any other way. You can keep your hourly employee status. 
 

However, modern "gig workers" don't seem to understand that they are NOT employees, and never were. They are running a business. Self employed. 
 

It's a world of difference. No comparison. I make a LOT of money as an independent contractor, because I understand I am running a business. Some of what I make is in direct wages, some in tax breaks, some in business expenses, some in alternative revenue streams. I chase every channel I can, because it's my business. And I'm good at it. 
 

I would be completely sucking wind if I considered it a job. 

Paul_VR6 (Forum Supporter) said:

It's almost like the gig economy is pretty crappy.

If you look at it as a replacement for a job like SVreX says, it is absolutely bad.

But if you look at it as a source of income that requires no real specialized tools, no real training, no problematic hiring hoops to jump thru and no physical labor....it's great.

A lot of the complaints had to do with miles on their car and gas money. You drive to work anyway so the money is pretty much spent regardless. A whole day of driving was 40miles for me....and I drove a 00 explorer with 220k miles on it at the time, no real loss there. 40 miles was about 2.5 gallons which worked out to about $8.

I might have some screenshots from when I did it and a breakdown if anyone is interested

In reply to SVreX (Forum Supporter) :

If but I had more than one thumbs-up to give.

I am so tired of hearing people enter into agreements for whatever, encountering the downside of the agreement, and then pissing and moaning because they don't like it.  "But I thought that...", "It's just unfair that....", "I didn't know that....", "I was surprised to find out that....", "I didn't expect...".  It makes my blood boil.  Read and understand before you sign.

But I'm not in the minor rant thread, so I'll go yell at a cloud or something.