The food and beverage industry has been hit particularly hard by the coronavirus crisis, with restaurants shifting to takeout and delivery orders to try to stay in business.
In turn, many customers are now using food delivery apps like GrubHub, PostmatesUber Eats or DoorDash to get food delivered right to their door.
However, they may not realize that many restaurateurs say the apps are predatory and harming their business - so much so that earlier this week, four online restaurant delivery companies were hit with a class action lawsuit that accused the the delivery services of using their “monopoly power” to impose “exorbitant” commission fees on restaurants.
Tom Gray, Executive Chef and Owner of Prati Italia and Town Hall restaurants, appeared on Thursday’s First Coast Connect with Melissa Ross, to share his experience:
“We in the past had been using GrubHub, but we currently turned it off, because the fees that are charged to us equal a total of 30%. So right off the top, they take 30% from us. And that just isn't a sustainable model for us, especially when we're only operating in a pickup mode, where we are operating at roughly 70% of our original business.”
Sarah Marie Johnston, Marketing Director and Owner of Prati Italia and Town Hall, also appeared on First Coast Connect, adding: “They've [the apps] also created some promotions, some kind of splashy promotions with pictures of storefronts and hearts and saying, you know, support your local restaurant, we're offering discounts. Except but what they don't share with the consumer is that the restaurant is absorbing 100% of this discount, and the delivery company is taking 100% of their commission on the full sale.”
During the program, one listener suggested Community Couriers of Jacksonville, a local grocery shopping and restaurant delivery service that serves downtown and the surrounding historic districts, and operates on a different model and fee structure, as a possible alternative.
But overall, Johnston says there needs to be reform in order for all parties - restaurants, delivery services, delivery workers and customers - to benefit from these services:
“They've required restaurants to adjust their business model to be in the delivery game. So how about if the delivery companies just reverse that effort and evaluate where their structure is. Let's bring the fees down for restaurants into a more reasonable range. Let's find a way for the delivery drivers to actually have fair wages, so that then there could be a little bit more equity among all the parties involved. I could imagine a scenario where there is a win-win for everybody, but it's not where we are at this time, especially not for the restaurants.”
In the meantime, Gray and others are encouraging customers to call restaurants directly to place an order for curbside pickup, if they are able to do so. While Town Hall is currently closed, Pratti Italia is open for this purpose, and also accepting online orders,Thursday-Saturday.
“That's the ideal. You know, not adding a middle person into the equation and just working directly with those restaurants that you've come to love and trust. I realize it's a little bit more inconvenient, but a lot of us have set it up in a way to make it very easy. You pull up and we'll bring the food to your car and if you want to be able to come in your pajamas and keep your slippers on that’s fine, you don’t even have to get out of the car,” said Gray.
However, if that’s not an option, Gray notes that other ways to support local restaurants include purchasing gift cards, which help the businesses with immediate cash flow, and give customers who wait to use them something to look forward to once everything reopens.
Contact Heather Schatz at hschatz@wjct.org.
