Two Local Restaurant GMs Chime in on Delivery Apps in MoCo
On October 20, 2020, the Montgomery County’s Office of Consumer Protection (OCP) warned consumers of the fees that delivery apps charge local businesses. The Washington Consumers’ Checkbook, cited in a press release by Montgomery County, reported that the estimated fees for using Uber Eats, Grubhub, and DoorDash charged to businesses were 38% of total order costs.
“Many residents have been eager to support their local restaurants by getting take-out and delivery. I don’t think they realize how much some of these delivery services charge the restaurants,” said Montgomery County Executive Marc Elrich in the press release.
After reading the report from the county, I reached out to two local restaurants for their opinions on delivery apps.
Wesley Yao, owner and general manager of Kusshi Sushi in the Pike and Rose neighborhood, talked to me about how delivery apps affected business. “My perspective on [using] multiple delivery apps is to view [the fees] they charge as paying rent. The reality is [restaurants] can’t afford NOT to utilize at least 1 or 2 of the apps.”
I also was able to speak with the general manager of Cava Mezze in Olney, Md, Lucas Georgiou, about his perspective. When I asked how delivery apps affected his business, he replied, “It definitely has a positive effect on our restaurant. It gives us a delivery option for guests that wouldn’t normally be able to come to the restaurant.”
Yao’s thoughts were the same as Georgiou, and said, “UberEats, GrubHub, and DoorDash have created a platform to create ease of ordering.” Since the pandemic began, ordering takeout offers not only convenience for customers but an option for people who are hesitant to eat out.
However, the high fees that delivery apps charge for their service can be costly for restaurants. When I inquired about fees from the service, Yao replied, “The fees hit me harder because our check averages range from $10-$300. So when I pay 33% on a $300 order it hurts me a lot more.” Though he added, “That being said I don’t think the fees are ‘unreasonable’ everyone needs to make a profit.”
Georgiou agreed with Yao, commenting, “You see less profit per order when you use a delivery app, but people who are using those apps are using them for a reason. They like the convenience and if you aren’t listed as an option you are more than likely losing out on that business.”
The potential profit from being on the delivery apps outweigh the fees for the service. Additionally, delivery apps provide a platform for restaurants and new customers. Yao had mentioned, “[Delivery apps] provide marketing to customers AND the drivers to deliver the food.”
When the pandemic began, countless local businsses across the country shut their doors. But delivery apps offer resturants an easy, contactless way to continue to serve customers. And in the end, the cost of restaurants sharing their profit with delivery apps is worth the business and convenience for customers that the apps provide.
As Georgiou put it, “Something is better than nothing.”