Delivery apps leave small businesses and employees unsatisfied
October 11, 2022
As a college student, I am statistically the type of person to use and abuse third-party food delivery services like DoorDash.
Roughly 63% of people aged 18-29 years old have likely used a service like DoorDash at least once every 90 days, according to a 2019 demographics report from digital marketing agency Zion & Zion. This usage is stark compared to people aged 45-60, 29% of which use the services once every 90 days, according to the same report.
While in college, the convenience of these services is too great to pass on. There was nothing better throughout my first year at Quinnipiac University than hanging out with friends and having our favorite meals delivered. However, I have a car on campus now, resulting in my friends and I driving places instead of getting delivery. In spite of that, the beautiful memories remain.
However, once I headed home after the spring semester months ago, I was reminded of the dirt and grime that goes into making DoorDash a viable service for large chains. On the other side of the spectrum, many small businesses use DoorDash but do not enjoy the systemic advantages of having the service available as the large chains.
When small businesses offer delivery service through third-party companies, it often throws a wrench into the well-oiled machines that are local restaurants and other eateries.
I have worked at a local, family-run chain of bagel shops since May 2019. During the onset of the COVID-19 pandemic in early 2020, we began offering service through DoorDash and GrubHub to offset the loss of in-person customers.
During that time, having these food delivery services around kept businesses alive. But this summer, when I worked in a seemingly post-pandemic world, I found that they were only a parasite, gnawing at the limbs of our profits and torching the money going into my pockets.
DoorDash latches onto our shop monetarily by charging a commission fee for each order, which the company’s FAQs section published, “to cover expenses that keep your delivery and pickup business running, including competitive pay for Dashers, third-party insurance, secure background checks and other benefits.”
While the rhetoric used on DoorDash for Merchants’ website is written to sound beneficial for both businesses and DoorDash itself, in practice it is much more one-sided. This commission fee comes directly from each sale made, which eventually forced the bagel shop where I work to raise prices on the service just to break even, depriving customers of the fair pricing offered in store.
A February 2022 article from CNN Business puts it best, saying, “Third-party providers charge fees which can be as high as 30%. Restaurants, particularly independent ones, already have thin margins. For some, delivery fees can mean operating in the red.”
Customers, myself included, do not seem to care about the pricing, and instead often express appreciation for the convenience the service offers, resulting in our stores receiving orders in large quantities that are difficult to keep pace with.
This leaves service to our regular customers neglected when they made the fair and reasonable choice to visit the store in-person. The rushes seen exclusively through DoorDash sadly made my coworkers and I seem less professional and almost rude to the customers as a result.
To mitigate these rushes, we have the option to shut the service down for a select period of time so that we can catch up. This option, though, has the potential to upset customers on that front, essentially making it impossible to please everyone with these services available.
While having DoorDash makes it difficult to please customers, it’s even more difficult to satisfy people like me, employees.
The shops that I work at when I’m home rely on customers tipping the staff at the end of a transaction, which helps employees make more money than salary alone provides. But on days when DoorDash dominates our sales, we lose out on substantial money through tips, as drivers are the ones who receive them, not us, the staff in house, the ones who do approximately 85% of the work that goes into a DoorDash order.
As a consumer, I am eternally grateful for the existence of DoorDash and other third-party food delivery services, and I am not putting down businesses who have good relationships with the company. Their ease of use and availability always keeps my stomach full when I am sick and tired of on-campus dining or when I don’t want to leave the house, but their parasitic business practices have been draining to small businesses like the one I work for.
DoorDash’s attempts to make money for itself are detrimental to the ability to turn a profit both personally and business-wide.