Why Did Uber Add $9 Delivery Fees on All Restaurants?

I haven't ordered from them in months due to that. $5 sure maybe but $9? That could be half the order..

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  • +29 votes

    To make money

  • I've found during peak times the fee goes up to $9 for all restaurants, but off peak the fee is less than that and varies by restaurant, probably to reduce the demand and strain on their drivers

    Peak being Friday and Saturday 7pm onwards

    • Economics 101 intern said we can charge more when demand goes up and inelastic at certain times.

      Lol, reduce @ demand and strain on their drivers.

  • +12 votes

    Well if people are willing to pay it?

    For me these services no longer represent value, the prices keep increasing while the level of service is consistently being wound back but that's an individual choice.

    • Spot on. My use of these services has declined markedly over the last few years.

      Fewer restaurants, higher prices, slower and less reliable delivery.

      I'm largely back to just ringing up for a takeaway and driving up to collect.

      • And the restaurant makes 100% of the money, not leaving a 30% tip for the ordering platform.

        You should do this for all accommodation too. Ring the hotel and ask if they can honour any trivago/booking.com price as they won't have to pay 20-30% for bring featured.

        • I've actually tried this a few times for hotels during my overseas travel. They told me that all their walk-ins are at full capacity, and if I can book via Agoda, do it there since they allocate certain rooms for online booking platforms. Though these were same-day booking. I'm sure its different if you plan your trip ahead of time like.. a normal person.

        • not leaving a 30% tip for the ordering platform.

          This comment is naive.

          I see lots of people bit*hing and moaning about the 30% commission (or whatever it is), but no one ever presents any hard facts about whether the average uber eats sale is less than the direct customer. I doubt that it's less, because most of the restaurants in my area have various discounts on platforms like groupon.

          I also never see any figures about whether a restaurants total sales have increased as a result of these platforms. My gut feel is that they have, especially during covid.

          Ring the hotel and ask if they can honour any trivago/booking.com price as they won't have to pay 20-30% for bring featured.

          This would only work at smaller boutique hotels. The large chains are fairly sophisticated about uniform pricing across all sales channels.

          Also, why would you waste your time, just to get the same price? Yeah, you could ask for a discount over the phone, but I doubt you'll get one.

          • @salmon123:

            …about whether the average uber eats sale is less than the direct customer. I doubt that it's less, because most of the restaurants in my area have various discounts on platforms like groupon.

            More or less orders, the restaurants' costs are still fixed in most ways for each meal. Ubereats is not only taking 30% of the profit - they take 30% of the actual total. Given the competitive nature of the food business nowadays, there might particular items on the menu where the restaurant may get an order, but will still end up taking a loss. So an increase in orders doesn't necessarily mean an increase of net profit for them.

            I have a friend who owns and runs a pretty popular franchise. Last year during covid, head office decided that they should add the total of the Uber orders onto their turnover figure. So not only were they paying the Uber portion, they then had to pay the Franchise fee based on a trumped up "turnover" figure.

            • @bobbified:

              Ubereats is not only taking 30% of the profit - they take 30% of the actual total

              Potato, Patada. My point was the restaurants in my areas can't sell a meal at full price by themselves anyway, so if uber/dd helps them do it and takes a cut equivalent to the discount they offer directly, they're no worse off.

              So an increase in orders doesn't necessarily mean an increase of net profit for them.

              Yeah, it's possible, but it's all anecdotal evidence. No one ever puts any figures to it.

              Last year during covid, head office decided that they should add the total of the Uber orders onto their turnover figure

              Yeah, franchisees get f****ed from all angles.

              • @salmon123:

                Yeah, it's possible, but it's all anecdotal evidence. No one ever puts any figures to it.

                Of course not - who's going to put the balance sheet of their restaurant out publicly for you to see?You can work it out roughly in your head that some orders are just not profitable or being sold at a loss.

                During the whole of last year, there would've been a huge increase in orders for the restaurants through the food delivery platforms. The restaurants would've had reduced costs since they had decreased staff and yet, so many of those restaurants still had to shut down. That should give you an indication of whether the online orders are really profitable or not and whether it's sustainable.

                Having a thousand orders per day with little or not profit isn't going to help too much.

                • @bobbified: I wouldn't cry for the restaurants. On the one hand they moan about the 30% or whatever the platform fees are but considering the number of restaurants nobody has come up with an alternative.

                  Sometimes you just need someone who is organised (like Uber) to put order to chaos. Those who can't survive will go out of business, those who remain will be able to increase their prices.

                  At the turn of the century there was more than 100 car manufacturers. Look at how many there are now.

                  • @netjock:

                    I wouldn't cry for the restaurants.

                    Oh.. don't get me wrong. I'm not crying for the restaurants. I'm just saying that the margins are not sustainable.

                    And if they are to survive, then those additional costs will just get passed onto…. .you guessed it… us, as consumers! It just means we pay more for the convenience.

                • @bobbified:

                  Of course not - who's going to put the balance sheet of their restaurant out publicly for you to see?

                  I didn't ask for a balance sheet (not that that's even the correct document to examine). A simple breakdown of profitability of uber/dd customer vs direct customer would suffice.

                  I'm going to throw it out there, if uber/dd is such an unprofitable platform for restaurants, why not just leave the platform? It seems to be the most logical conclusions.

                  You can work it out roughly in your head that some orders are just not profitable or being sold at a loss.

                  I'm sure all restaurants have that issue with some orders, uber/dd or not.

                  The restaurants would've had reduced costs since they had decreased staff and yet, so many of those restaurants still had to shut down. That should give you an indication of whether the online orders are really profitable or not and whether it's sustainable

                  Unfortunately it doesn't, because there's so many other factors at play - rent negotiations with landlords, jobkeeper subsidies, etc.

          • @salmon123: it takes the same time to book online with the american companies as it does to call Nan'n'Pop motor inn to make a booking, and all money stays in australia for them to employ and improve the accommodation.

            Prices are uniformly higher on the uber and other platforms to cover the extra costs, plus the delivery fees additional to this so, being a bargain website, i will always order through the restaurant. Even mcdonalds and subway are almost double the price to order + delivery.

            Please hand in your bargain hunting license.

            • @blank-404:

              it takes the same time to book online with the american companies as it does to call Nan'n'Pop motor inn to make a booking, and all money stays in australia for them to employ and improve the accommodation

              Debatable - researching the ownership structure of a particular Nan'n'Pop motel is going to be time consuming. Your independent motel is regional Australia is equally likely be to run by an immigrant family, who'll remit the profits back overseas to pay off loans, etc.

              Prices are uniformly higher on the uber and other platforms to cover the extra costs, plus the delivery fees additional to this so, being a bargain website, i will always order through the restaurant. Even mcdonalds and subway are almost double the price to order + delivery.

              I never said otherwise. Your statement is even more true, when you factor is promotions run by the restaurant directly, that don't work on uber/dd.

              Please hand in your bargain hunting license.

              I'd suggest the same for you. It sounds like you go out of your way to inconvenience yourself, when you book directly with a hotel at the same price. Bargain hunters don't really do this, unless there's a discount in it for themselves.

              • @salmon123:

                Debatable - researching the ownership structure of a particular Nan'n'Pop motel is going to be time consuming.

                You see the prices on trivago and ring the hotel/motel/inn yourself, by the time you go through the 3 pages to fill in and CC processing you could've rung and booked. Depend how long it takes you to press 10 numbers on a phone i guess, or you could ask google/siri to call for you.

                Your independent motel is regional Australia is equally likely be to run by an immigrant family, who'll remit the profits back overseas to pay off loans, etc.

                But at least their income and tax bill is higher in Australia, and they have the ability to add more jobs and upkeep the rooms.

                It sounds like you go out of your way to inconvenience yourself, when you book directly with a hotel at the same price.

                If the price is the same and it takes less time to call than to navigate a website, I don't see it taking longer at all. You are saying you find it better to use a website that artificially bumps up prices and calls them bargains, sometimes you can get discounts with direct bookings cause the 20-30% trivago tax can be discounted. Everyones mate Dick can tell you more (if you want to hear from the voice of reason)

                • @blank-404:

                  If the price is the same and it takes less time to call than to navigate a website, I don't see it taking longer at all

                  I don't think calling them more is convenient/quicker/whatever

                  But at least their income and tax bill is higher in Australia, and they have the ability to add more jobs and upkeep the rooms.

                  I don't know what you're arguing at this point. Any business in Australia would create the opportunities you've mentioned. I said that you need to research the ownership structure of a business for your point about keeping profits in Australia to be valid. You haven't countered that.

                  You are saying you find it better to use a website

                  Yup. I haven't used the websites you've referenced (tivago/booking.com), but expedia is pretty painless and they almost always have a coupon, which means booking through them is cheaper than trying haggle with the hotel directly. I can do a booking via expedia much quicker than I could call someone.

                  • @salmon123: The businesses would get 30% less revenue, therefor pay 30% less tax, I don’t have to counter your point because the point has already been made, you just can’t see it. Businesses have to get at least 20% more trade than they do to make the same, which drives up the cost for everyone. I know I’d rather pick up the phone to order $45 of food than pay $60+$9 delivery (ooh, but there’s a coupon for 10% off, yay).

      • I've had half my order not show up and the other half was cold from Ubereats. The compensation they offer (price of the item that did not show up) doesn't do any justice to having half your order not show up when you ordered the food expecting that it would be delivered in full.

    • I agree. The service gets worse.. and it just keep costing more.

    • I find the serving sizes are tiny now. I feel like a few years ago if you ordered any sort of Asian takeaway there was always enough for lunch the next day. Now even an entree/main/rice is barely enough for 1 person. Why are rice servings so small?!

      • Shrinkflation.

        All costs go up (2/3 of the total) unless you can increase you menu prices you are left with shrinking the product to stay competitive on paper price wise.

  • Do you expect some poor sod to spend 10-20 mins of their time for only $5?

    I'm happy to have a lazy night in every other month with a few drinks and pay $9 for the convenience of having food delivered.

    • The drivers get paid $10 per delivery minimum, the fee charged to the customer is not reflective of what they are actually paid

      Hence why they take 30% of the entire bill from the restaurant

      • The drivers get paid $10 per delivery minimum

        lolwut, no they don't. Plus Uber takes commission off the delivery person too. (That part is wrong since three days ago)

        • Housemate works for Uber in melbourne and his pay rates have not changed.
          $10 min for a single delivery, it changes if he takes more than one delivery at a time

          • @jimbobaus: Your housemate apparently doesn't pay tax, or have to put fuel in his vehicle, or pay for tyres and brake pads, teleports from previous order dropoffs to next order pickups, and has a magical version of the app that just plain doesn't exist.

            There is no $10 minimum.

            • @Kyanar: I am talking about what Uber pays him.

              Every delivery he completes = $10 paid to him MINIMUM! (sometimes it is more if he takes multiple deliveries at once on the SAME RUN)

              Not rocket science… $10 min means exactly what it says. He gets paid $10 minimum, if he does one del its $10 if he does 2 on the same run its like $16 and so on….

              • @jimbobaus: And I'm telling you, unequivocally, there is no $10 minimum. It doesn't exist.

                The only way he'd be achieving that is by rejecting every lower paying job, which will eventually result in him receiving significantly less jobs because Uber's systems will classify him as a "sub-prime" contractor.

          • @jimbobaus:

            it changes if he takes more than one delivery at a time

            Then the food gets cold. Nature of the problem with the industry. People might order non perishable food in bulk but it is really hard to get economies of scale for perishable food.

      • driver gets minimum of $3.12c for a 1km in Sydney

    • They also don't do one pickup or delivery at a time. They can deliver several in 20mins (at least in busy inner city areas during work days).

    • I don't know why people upvote incorrect information.

      • I always assumed the driver gets the delivery fee and the UE's cut is the 30% from the restaurant.

        jimboaus has set me straight though. Happy to be wrong - turns out they make more money than I thought.

        • No, he has not set you straight, and they make far less than you thought. The delivery person gets a pickup fee, a dropoff fee, and a per km fee. They're required to have their own insurance and pay for all outgoings for their delivery vehicle as well, and have to have an ABN. If they also drive for Uber (which they can't do at the same time as deliver for Uber Eats because they're separate companies) then they even have to take GST out from the delivery fee (Uber pays the same amount whether you're GST registered or not).

          After covering expenses, you'd be lucky to have $10 an hour.

          • @Kyanar: What people make really varies, saying someone is lucky to have $10 an hour is wrong. Maybe you were walking to your delivery destination.

            In a perfect world, these delivery services would pay exactly what people are asking.

            Unfortunately, mostly because of international students, there are too many desperate people.

            This is why in some areas or times of the day, you can make a decent amount of money, and in other areas you won't.

            • @samfisher5986:

              What people make really varies, saying someone is lucky to have $10 an hour is wrong. Maybe you were walking to your delivery destination.

              No, it's very true. Between waiting at restaurants who say the order is ready for pickup when it isn't, driving to the restaurant (which you are not paid for), driving to the customer, handing off the food then waiting for your next delivery, it can easily take 20-30 minutes for each order. Out of that, you get a pittance, which you then have to pay for your vehicle's running costs including petrol, and the Tax Man's take, no - $10 an hour, or less, is quite realistically what you have.

              Been there, done that, was entertaining for a bit I guess but not by any stretch of the term sustainable as an actual job (or even second job).

              • @Kyanar: Plenty of people earn more.

                But I'm not exactly disagreeing, you get very little, even if its more then $10 an hour, and certain circumstances can ruin your profits, such as having a bad night with restaurant reliability or driving a car that eats fuel.

                • @samfisher5986: Those that earn the most do it by being borderline unsafe in their practices - working 18 hour days, speeding and breaking road rules like nothing on earth (praying they don't get their license suspended or a fine), renting their accounts to others to perform deliveries round the clock - that sort of thing.

                  Think of Uber Eats like OnlyFans - the top 3% of earners probably pull in the top 70% of earnings. Remember, Uber does "steer" deliveries toward certain categories of driver (the almighty Algorithm).

                  • @Kyanar: This is an incorrect assumption.

                    Working 18 hour days would not increase the hourly rate, and literally nobody does this because its not financially viable.

                    Most international students follow the rules, they can only work 40 hours per fortnight.

                    Most uber drivers do not break the rules, but a lot of them are not very competent on the road, obviously because they are new to driving or riding in Australia.

                    You can't rent Uber accounts, this was something that happened quite a while ago and then Uber started requiring on the spot checks at any time. Deliveroo/menulog accounts still get rented, yes.

                    The biggest thing I forgot to mention is this, if you are working and then doing Uber in your spare time you are at a huge disadvantage. Anyone who is doing uber eats alone will not lose their money to tax which is why their income will be much higher for doing the same amount of work.

                    • @samfisher5986: No, it's not an incorrect assumption.

                      Working 18 hour days would not increase the hourly rate.

                      No, but it would increase total earnings. I've heard first hand accounts of people doing this, even doing passengers as well, and then crashing while carrying passengers.

                      Most uber drivers do not break the rules, but a lot of them are not very competent on the road, obviously because they are new to driving or riding in Australia.

                      Er, do you have any idea how often police have to fetch Uber Eats cyclists out of the toll tunnels? It's more common than you think.

                      You can't rent Uber accounts, this was something that happened quite a while ago and then Uber started requiring on the spot checks at any time. Deliveroo accounts still get rented, yes.

                      Oh, you sweet summer child. It absolutely still happens. There are so many ways around Uber's face checks.

                      • @Kyanar: I think you are taking rare problems and making it seem like its a common occurrence.

                        Your first hand accounts are obviously just a dodgy circle of people you know, its not as common as you think.

                        18 hours a day on uber is so pointless and that person you know clearly doesn't have the intelligence to realise that getting a second job would be hugely more profitable during Uber's quiet times.

                        In fact, if they wanted to work 18 hours in a day they would be rich by doing literally anything else, there are plenty of jobs available if you are comparing it to uber.

  • That's pretty much standard delivery fee for me in Perth

  • The chinese restaurant I like in the area, if I book them direçtly for more than $35 order will give me 5% off and free delivery.

  • Prices are dependent on how many available people are out there. So if there's not many you'll see huge prices like that (I think sometimes they show a little icon next to it). Usually it happens a lot during storms/rainy times. But other then that its generally based on distance, for example many near me are like $2.99 delivery.

  • Try Menulog? 1.99 off peak, and 5 otherwise.

  • Uber gives very low commission to drivers, And during peak they give drivers 1.1 to 1.3x on there base, so maybe that's why the delivery fees are higher, but still uber is taking way more cause it definitely doesn't go to the drivers.

  • If the delivery fee went 100% to the driver i wouldn't mind paying the $9 delivery fee

  • Another reason not to use Uber.

  • Uber eats and Menulog et al is not the cheap food delivery utopia all the marketing and media would have you believe.

    Its actually quite expensive compared to getting off your lazy arse and cooking at home!

    • Unfortunately your cooking, and most others would not be anywhere near as tasty as a nice specialised restaurant, as much as you think otherwise.

      • I sorta love my cooking… and it makes me feel good. But hey, it's all about habit and necessity too. I'm loathed to pay for mediocre food and the more I cook my own food, the fussier I get with buying takeaway/restaurant food. Plus the savings mean more money for chocolate and wine 😉

    • I completely agree, but the convenience of browsing through lists, ordering something you know and like and having it turn up on your doorstep is a huge appeal to a lot of people in this day and age. That's why Uber and such have become so big, and it was inevitable that it would become more expensive for buyers as more complicated processes and concerns come into play as it gets bigger.

      The period of introduction and establishment is over and now it's about improving and protecting what they have created and putting proper systems in place for everyone involved after the lessons learnt during startup.

    • Agreed however it is much more time efficient compared with traipsing to whatever takeaway hell-hole it is and waiting in line then driving home on those odd occasions a take-away is desired.