Independent restaurants are trapped in an ordering epidemic.
Across the country, third-party food delivery apps have become a part of everyday life. But beyond their marketing-fueled facade of convenience and instant gratification, they’re killing the restaurants we love.
Lured-in with signup deals and hooked with the promise of sales boosts, restaurants are discovering that life inside the web of big tech is unsavory at best. With commissions as high as 40% on every order — on top of a delivery fee and service charge — these apps are forcing restaurants to sacrifice a large slice of their already razor-thin profit margin.
The average restaurant only nets a 6% profit. If a restaurant only keeps 60 cents of a $10 sandwich, an added commission of 40% whittles their margins down to nothing. In many cases, restaurants lose money on these orders.
And as third-party food delivery apps gain popularity among diners, restaurants are seeing sharp spikes in the kind of delivery orders that hurt them the most. This is simply not sustainable. With nearly 11,000 independent restaurants closing in the U.S. in 2017,2 our very own communities are at stake.