“They’re an angel and a devil all at once.”
That’s what the owner of a medium-sized Burnaby restaurant told me a couple of weeks ago about the food delivery apps they were forced to team up with during the COVID-19 pandemic.
Pre-pandemic, the restaurant chose not to use the app because their food wasn’t necessarily the best for take-out.
That changed with the lockdown, in which many restaurants went to take-out before the province allowed them to add dine-in services.
Desperate times mean changing how you do business. Then when dine-in service was allowed, this restaurant decided to keep the food delivery apps because many of their customers still aren’t reading to eat out.
So, for a while, the apps were useful, but still not great because they charge the restaurants a huge percentage for the service. The BC NDP says the fees run as high as 30% to a restaurant.
As time has gone on, the fees the restaurant is charged make it nearly impossible to make any kind of profit and is helping push them to the brink of collapse.
“I have so many mixed feelings,” the owner said. “I don’t know how long I can continue this.
Some restaurants are able to absorb these fees better than others. The Cactus Club chain is even holding a contest right now to “celebrate their nationwide partnership” with prizes that include a Door Dash gift card. But big chains with deep pockets have the kind of volume, I guess, to handle these percentages.
Other smaller, independent restaurants don’t have that advantage. People might respond that nobody is forcing them to use the apps, but COVID-19 kind of is forcing them.
This has become an actual election issue, with the BC NDP and BC Liberals both promising to cap these fees.
“Third-party delivery apps are charging restaurants upwards of 30% on orders, deeply impacting restaurants’ bottom line. And these apps charge customers delivery fees on top,” read a statement from the BC NDP. “The BC NDP is calling on third-party apps to cap their fees at 15%. If the industry refuses to implement a voluntary cap, a re-elected BC NDP government will move to regulate a 6-month temporary cap to protect B.C.’s restaurant industry, and the 180,000 people it supports.”
The BC Liberals have also vowed to cap the fees at 15%, but haven’t said what time limit that would involve.
Follow Chris Campbell on Twitter @shinebox44.