In the midst of all the hype around delivery and takeout platforms, it seems as though many restaurants have glossed over the intrinsically high fees of this new luxury. By digging through layers of terms of services and calling numerous customer service lines, we've been able to paint a picture of the true costs of signing up with some of the more popular ordering apps.
In this compilation, we focused on 7 popular ordering applications including: Ness, GrubHub, Postmates, UberEats, DoorDash, ChowNow, and Slice.
Ness is a mobile ordering platform for takeout and delivery (if the restaurant has their own delivery service). Prided on being business friendly, Ness’ pricing is very competitive. There is a one-time charge of $30 for setup fee and a credit card processing fee of 50 cents + 3% per transaction for in app payment. For all in-store payments, restaurants pay 0 commission on all orders, allowing restaurants to keep all the profit.
With their service, Ness also provides a customized dashboard that allows restaurant owners to set daily offers and award loyalty points to customers.
GrubHub is the biggest player in this space, with revenue growing each of the past 5 years. Their services could be broken into 2 sections -- delivery and pick-up. For delivery orders, GrubHub charges restaurants 10% delivery fees per order, in addition to the 15-20% of commision that they charge from every online order. For pick-up orders, GrubHub charges 15% commision for non-sponsoring listing and 20% for sponsoring listing.
Postmates, UberEats, and DoorDash
Postmates, UberEats, and DoorDash are 3 of the largest food delivery companies in the country. These 3 companies are specialized in food delivery, with a dedicated courier team that picks up orders from restaurants and deliver to the customer’s doorstep. Each company charges a 20%-30% commission on every order depending on how much visibility you want on their platform. Delivery service is definitely becoming increasingly popular amongst teens and the working class. However, restaurant owners are paying a significant among of profit on commision partnering with these delivery services.
ChowNow’s core business is creating online ordering system for restaurants. This comes with a hefty price. On their official website, the most popular option-- annual plan, will cost restaurants a setup fee of $199 per location and $119 per month. On top of the fixed cost, although they do not charge commision on orders, they do charge a credit card processing fee of 10 cent + 2.8% per transaction.
Slice is another online food ordering service, but they have a very specific clintentel-- pizzerias. Slice targets local pizzerias, offering them a platform where customers can order pizza online and pick up when it’s ready. Without a dedicated courier team, Slice’s emphasis is on takeout orders. They do offer the option for delivery if the pizzeria itself have delivery service. Its target customers are people who enjoy the simplicity of online ordering with pizza chains but wants better quality pizza. Slice’s revenue comes from their commision at $1.95 per order regardless of size of the order. Pizzerias may choose to set a minimum on the order.