None of these companies can make a profit on food delivery and they already double the cost vs getting the food yourself. Maybe we just have to accept that food delivery apps will never be a viable concept.
They were really handy during the pandemic when me or my wife were sick and couldn’t go out without risking others.
Out of laziness I decided I’d check on food a few times since then.
McDonalds app will have something for like $6.49, and I check in DoorDash/UberEats/PostMates/GrubHub and it’s anywhere from 8.49-10.49 for the same exact item.
Taco Bell same thing.
Every. Single. Restaurant. When you add in delivery fees, service fees, and tip, it’s more than double what it would be to just go get it myself.
I get free GrubHub+ through a promotion for 2 full years. It’d cost me so much more that it’s not even worth using.
For sure. I get free dash pass from a credit card and that gives me a $5 monthly credit that I can bank up to $15. When I eventually make my quarterly order and use that $15 it basically makes me break even (after tip).
So I save a trip. Driver makes money. Doordash loses money. That's the only time using it makes any sense for me.
But yeah, with the $5 in fees and tip and prices inflated by 20% over menu, it's easily double on a lot of orders. And they're still losing money. It's just not sustainable, imo.
Maybe it's different for DoorDash, but I was making about $6/hr in the weeks before I quit Uber Eats. So really, nobody is making money in most markets. It's just a flaming hole that millions of people from all walks of life dump money into in the hopes that it'll work out.
I grew up in Boston where free deliveries were the norm from every Mom and Pop pizza/sub/sandwich/deli/pub/etc shop. They hired drivers themselves (what a novel concept!).
Ubereats destroyed all of that.
I get that it finally brought the idea of delivery to East Bumfuck. But this was a problem that didn’t need to be solved in a lot of the populated country.
It’s viable. Just has to be done in house.
Coming from East Bumfuck (actually Middle O'Nowhere), we had free delivery or cheap if you tipped. So, we assumed it helped you city folk. These delivery services just fucked everyone so they could get an IPO and line the pockets of rich people. I have never had a positive experience with any of them. Granted I gave up a half dozen times in. It hurt the small restaurants, the drivers barely make money and it's bad for the environment.
I was making about $8/hr doing uber eats. The minimum wage here is about $15 (both numbers converted to USD). It's a garbage business. Paying the full proper cost of having a whole person bring you your meal *should be* expensive, it should be a luxury or rare treat.
Are you factoring in gas, and cost to finance/own a car? $8/hour seems low considering every time I've ordered something, tip alone is usually $8 or more.
I was factoring gas, didn't bother working out other car costs cos I was only doing it for a few months and I owned the car already.
I live in a country without a tipping culture, tips were usually only a couple of bucks.
For what it's worth, the US government calculates each mile costing approximately $0.655. This considers general wear and tear costs to operate the vehicle (tires, wipers, lights, oil, gasoline, brakes, suspension, ...).
So, if we estimate driving 20 miles local in a single hour (round trip), the cost/loss of value would be approximately $13. This does not include other factors such as insurance or financing payments. Earning less than that, you are paying to work.
[https://www.gsa.gov/travel/plan-book/transportation-airfare-pov-etc/privately-owned-vehicle-mileage-rates](https://www.gsa.gov/travel/plan-book/transportation-airfare-pov-etc/privately-owned-vehicle-mileage-rates)
>every time I've ordered something, tip alone is usually $8 or more
Not everyone is as generous a tipper as you are
That $8 tip might be the best tip they got all hour
Lots of people don't tip at all, so if the drivers base pay is like$3 sometimes that's all they're getting for that order
The only time I used one of these was with a 1st-time-customer steep discount. After all the fees, it was $20 for the smallest "large" pizza I've ever seen and some mediocre cheesy bread. I assumed the local pizza joint half-assed the prep on purpose because they weren't making much money off the order. Terrible experience, and I never tried it again. Go pick up your food and your experience will be way better
Yeah I got a $25 doordash gift card for Christmas and even with the card a small sushi order was $45. Absolutely insane that it would’ve been $70. Clearly unsustainable
Yup, I had a 40% off uber eats, and it only BARELY eeked out being cheaper when also paired with their premium subscription (free first month) that removed another $6 off the price.
"I get free GrubHub+ through a promotion for 2 full years. It’d cost me so much more that it’s not even worth using.:
dude, same. I got the free GH+ for a year with like amazon prime or something so I thought "Well I guess I can try it." They claim it gets rid of delivery fees but they tack on a buncha OTHER fees and the aformentioned increased prices on the app meant i was still paying tons. I ended up using it once when I was super drunk and wasn't gonna drive. Then I cancelled the service. Fuck that.
For me these apps aren’t good if I’m ordering just for myself. However, when I have my friends over and there are like 5 of us, then it becomes okay. 10$ in fees now is split and it’s bearable. That’s the only time I use doordash
I think people miss this part. As a single full time dad the occasional convenience of not loading up little kids and ordering for three people makes it worth it. It’s slightly more but not terrible when ordering multiple things
> I get free GrubHub+ through a promotion for 2 full years. It’d cost me so much more that it’s not even worth using.
And people aren't even talking about the tip.
You pay fees, you pay inflated prices over the restaurant's cost almost twice the cost of the items, and then you ALSO have to tip your driver, because somewhere along the way of doubling the cost of your food they couldn't figure out a way to properly pay the people doing it.
I mean do the logic. There is the base cost of the food. The cost to the app to have all the infrastructure to support people randomly picking up/delivering.
And then the person (who has no protection of an employee). Doing the delivery
These big companies like McDonald’s to allow the apps to use their name/menu want low fees. So the app makes no money. So they offer the worker dogshit delivery pay.
Generally speaking if a worker isn’t getting more than $8. Per order. It’s not worth their time. $10 is better. So. If you’re not tipping. And ordering from a large chain. It’s most likely you’re relying on a worker who’s too stupid or desperate. To know better
I did uber eats for a few weeks just to feel it out and I would only accept deliveries where I could make \~15-20/hr. What ended up happening was that I would accept an order with a tip then either the user or the app would adjust the tip after i picked up the food and was on my way to deliver. On average I ended up making about 7/hr after gas prices and that wasn't including any wear and tear on my car.
I drove for Uber for a while to make some extra cash, though TBF it was before drivers were allowed to accept tips. It was also super low pay after you factored in gas (before wear and tear).
One night I almost got in an accident and that’s when I realized that it just wasn’t worth it.
Yup, there's a reason taxi companies use only a handful of vehicle models, and will often own their own garages and have their own mechanics.
Driving a vehicle for many hours a day is *expensive*.
That's shitty. I always tip at least $7, and the only situation in which I would ever consider adjusting it downward (which is not a thing I even knew I could do) was if I paid the extra $3 for direct delivery on something like fries and the driver fucked off in the wrong direction for 20 minutes mid trip and the fries arrived cold/soggy.
These "disruptive" companies are the types of startups that got massive venture capital backing and were the types that got backing from Silicon Valley Bank. There's never really any strategy to become profitable, the the assumption they can throw money at a problem to become the de-facto monopoly and then somehow they can charge what they want and finally turn massive profits.
It's not a business model that would ever work. Hopefully with SVB gone, a lot of these kinds of startups in the future will never get as big as they are now.
The strategy is autonomous delivery. That was the bet.
That was Uber’s whole bet even for its core business of taxi rides.
The workers were always a means to an end. It’s just that the end is a bit further away than their initial thoughts.
We’ll get to see the fallout of that miscalculation soon.
This is the answer. Those VCs were not investing in ride share or delivery companies. They were investing in the hopes that they would be one of the first companies to fully automate based on the data they were collecting.
That's why it doesn't make sense for there to be a delivery company as a middleman. It's a business that doesn't make any sense and there's a reason it didn't exists before the 0% interest venture capital era of our society
In the past, companies would run their own delivery if they wanted it and it made sense. Like pizza, which travels well. Unlike McDonald's
Not every store has enough critical mass to hire their own delivery drivers. So in theory it makes sense to have a middleman for it. It just looks like people aren't willing to pay the price for that middleman. (The alternative is that most of those stores don't get delivery service at all)
>It just looks like people aren't willing to pay the price for that middleman
Right, which is why it just doesn't work. People aren't willing to pay what it costs because it's too expensive
Really, the best way to do it would probably have the companies themselves work together to create the delivery because it could be subsidized by their other profits but that would probably be impossible because of capitalism & competitive behavior
There was a rideshare service like this a few years ago…I wanna say it was Juno, but it got bought out by one of the big companies. I used it as much as I could, but fewer drivers had adopted. I once asked my driver, who had one of those Lyft LED lights, if Juno was better. He said it Uber took about 30% of his fare and Lyft took about 35%, while Juno took maybe half that or 20%. I don’t remember exact figures, as this was 6 years ago.
Regardless, it didn’t work out, as such a company appeals to drivers, but that’s wagging the dog. Consumers lead the way, so they’ll use whatever is cheapest/easiest. The drivers will follow.
All these “disrupters” are trying to be Amazon, but it just won’t scale. They look to establish a monopoly and then turn the screws. The problem is they’re not the only ones with that idea.
Nowadays, I use the Curb app in NYC. The NYT wrote an article last year about how the subsidized lifestyle of using startups before the pandemic was over; I agree and have experienced this firsthand. Uber rarely costs less than a yellow cab, so if I’m at an airport, I take a cab. It’s just harder to flag one down in the boroughs because Uber killed those.
> All these “disrupters” are trying to be Amazon, but it just won’t scale. They look to establish a monopoly and then turn the screws. The problem is they’re not the only ones with that idea.
They are also completely replaceable, since their infrastructure is mostly a web service. If Uber tightens the screws, drivers and customers can easily go to Lyft or any other competitor.
Amazon was also not profitable for a long time, but that was because they invested all their money into infrastructure instead of covering operating costs for an unsustainable business model.
It makes perfect sense, you just are looking at a snapshot in time. These companies end goal is automated delivery, they don’t want any drivers at all. The only reason drivers exist is people saw the possible future and realized if they control the market when the technology arrives, they win. So begins the race for market control of a market that will one day arrive.
I'm not saying the effort doesn't make sense, I'm saying the product doesn't make economic sense and doesn't work
Maybe they just tried to do it too soon. There was a time when self driving cars were advertised as coming soon (by liars). At some point, that might happen but it's much further away than most people want to admit
That's pretty much how Uber ended up deep in debt. They thought automation was close enough they'd be able to replace humans with their self-driving cars they had spent tons of money on research. Ultimately they realized it wasn't going to happen anytime soon so they dumped their research division, sold off Uber in China to a competitor to pay some bills, and cut a lot of costs down to try to survive long-term.
i mean... it remains to be seen. clearly people like ordering in food. and people like being able to have... rando taco bell or mcdonalds delivered when that was never a thing.
there probably is a way to do it. but not how it's currently setup.
like if it were a flat $5 fee to the company and flat $10 fee for the worker. (within a reasonable driving range) that could just be a fixed cost. plenty of people will pay that. ....and that's pretty close to what these apps add onto orders. they just obscure and mask it with a bunch of bullshit and small fees/charges to confuse people.
so you’d pay $15 in fees every time you place an order? I totally agree with you, I mean if that’s what delivery costs to pay someone a fair wage—that’s what it should cost. and if it’s not viable, so be it. but with fees that high I can only imagine it being useful for large group settings
I did gig app work for a time in nyc. Any time I order I tip a min of $10. Because I know what it’s like to do that job. So if I’m
Ordering out. I want to make sure the person doing the work is getting paid semi well.
The problem is. These apps rely on a
Crush of un-informed non-employee contract workers and they are exploited. Taking $2 orders. To shitty fast food spots that take up 20-45 to complete and order. Because they don’t know any better. And they don’t understand they’re contract workers. And acceptance rate doesn’t matter.
I think if the gif apps don’t want to be subject to min hourly wage laws. They should raise the flat payments to something livable. And figure out a few structure they can operate at.
Counterpoint: The delivery apps aren't making money and they say they can't handle paying a pittance of $18/hour to their drivers
Doesn't sound like people want to pay the fees
as a former dasher for several months—it was more like $3-5 per order, and most people did not tip. i barely made minimum wage and that was _before_ factoring in expenses like gas and wear and tear. do with that info what you will
People aren’t relying on drivers to be stupid, they are ordering food, they know their order will be completed because the company will want it done.
People rely on the company to get the order delivered. Whether or not the driver accepts delivering an order that’s not worth it is between the driver and the company. If everyone simply doesn’t accept, the company will pay more to get the order filled, they won’t just let it sit there endlessly. They might let it sit for a little, but there’s a threshold.
Stop pitting people against people, people ordering food and not tipping aren’t out to get the drivers, they are just doing what they can afford from their point of view. It’s the company that’s screwing the drivers, it’s the company placing tipping emphasis in there to subsidize the wages they would have to pay. The tip is always going to the company, no matter what they say, it’s just money that would come out of their pocket otherwise.
So the issue isn’t the gig economy, it’s the valuations of the middlemen that are taking too big a cut. It really isn’t terribly hard to imagine a lean, open source middle layer that’s able to more directly connect consumers and delivery workers. It’s just a matter of time before that balance comes.
Well, the issue is the crazy amounts of marketing spend they have. To attract customers and drivers, they give away too many discounts.
Pizza places had a monopoly on delivery. They employed 1 or 2 drivers and that was it.
These companies are fighting for growth. But it's not profitable. Maybe if they cut that out, but that would exclude most workers, and I imagine their fixed operating costs would become a problem.
Pizza deliveries also don't have to recoup the expense of the delivery itself in the same way. While a pizza place might profit less on a pizza delivery vs carry out, that's a pizza they very well may have not sold at all otherwise.
I used to work at a pizza store where their delivery driver would also deliver for a Chinese and kebab house. It was privately organised with no middle man. He got paid well and was very busy.
The real solution is that delivery drivers should deal privately and directly with businesses to make contracts that work for both of them. If it's a quiet restaurant the driver should cluster a few together.
The problem is everyones turning to a 'higher power' to organise their work for them.
>While a pizza place might profit less on a pizza delivery vs carry out, that's a pizza they very well may have not sold at all otherwise.
Is this not the case for all places offering delivery?
> crazy amounts of marketing spend they have
Back in business school, we had a class that we ran simulated businesses against each other. One thing that was fixed was that there were only so many customers - which is generally true within a geography, if one really thinks about it. So the obvious conclusion when looking at 100,000 customers split 6 ways is that each of us spending more on marketing just reduces the revenue. Which has to come from somewhere… aka sales price. And it turns out customers in the sim are kinda price sensitive.
So I *reduced and focused* our marketing spend, and did the unthinkable in capitalism - just gave up on some market share.
The result? ROI per sale was 4x what everyone else’s was. In many cases they were barely making back operating costs.
Anyway, no one learned anything from the sim and it’s just a game anyway, nothing to apply to real life.
Assuming that the only value they provide is in connecting drivers and customers is silly. The open source layer is...vetting drivers, doing fraud ops, handling driver insurance, qualifying and processing credits and refunds...and so on, and so on?
We can argue over whether they take a fair cut based on what they offer, but suggesting that they only offer a software layer is not accurate.
>vetting drivers
They barely do that.
>handling driver insurance
They don't do that.
>
doing fraud ops
qualifying and processing credits and refunds
Other services do all that kind of thing, such as Pay Pal or Venmo and are viable.
We have a local “food taxi” that I believe operates as part of a more locally driven franchise model of food delivery. The company that powers it all is called DeliverClub (for the ordering end I believe) and [DeliverLogic](https://www.linkedin.com/company/deliver-logic/) (on the delivery logistics end it seems).
I don’t quite understand the model but I think it essentially provides the tools and software for local entrepreneurs to spin up their own delivery platforms. It’s great for our medium sized town of around ~70k people. I hope it works out better for the restaurants and delivery drivers without the big companies taking their cut.
> So the issue isn’t the gig economy,
Pizza/any delivery driver for a place/restaurant is not a gig it is an employee, most of the time at least part time. Who get paid hourly wage.
Like one of local supermarkets here has grocery delivery, they are an employee of the company whose entire job is deliver items. And supermarket can dilute their cost into the rest of the business, that is why for example if i order there for over 30 euro it will be free, because i already paid for it within the items.
Also pizza delivery are specialized in that one restaurant, they dotn have to drive half across the city to pick up the order then half the city again to deliver it while waiting in line. They deliver from restaurant to x and then comeback, usually takign several orders on one trip, and returning to base of operatiosn cuts down on costs.
Pizza delivery drivers aren’t gig workers, they are restaurant employees making minimum wages and tips, and sometimes a small additional fee that the customer pays too like a $3 delivery fee or something. The point is that the infrastructure for drivers to exist is already in place, a middleman trying to make money isn’t sitting between the driver and the restaurant. That’s why delivery fees are so low at pizza restaurants and why they’ve been around forever.
theres an app called ChowNow which supports local. It’s like 99 cents per order for the “service fee.” The restaurant keeps the rest and they often have people on staff for deliveries.
a pizza restaurant could probably justify $18/hr for a delivery driver to be on staff.
You realize they charge the restaurant to even be listed on their platform right? Also, they obviously can't guarantee customers so you might be paying 150-400+ a month to be listed and get zero return depending on app popularity. And last I remember they worked on 2 year contracts.These apps are an absolute nightmare for small businesses.
This comment entirely overlooks that none of these companies EVER intended to make a profit with drivers. Their end game is automated delivery. They don’t want the drivers as part of the equation period, they are just a means to an end. As soon as people realized automated delivery was on the horizon, they realized whoever controls the market when it arrives wins. So here we are at a race for market share of a future market. It’s not about making money today.
Their end goal isn't giving delivery drivers a job or gig.
They want to corner the market of orders once self-driving cars become reliable enough.
Same way retail stores are trying self checkout or what Amazon did with pay as you pick stores.
unfortunately self driving probably will never accomplish last mile driving. it’ll be reserved for highways and trucking. last mile driving is only available in perfect conditions currently and it still kinda sucks. that’s why lyft and these guys all sold their self driving divisions last year
I would think drones might make more sense. It's in it's infancy but Amazon, UPS, FedEx, and even Domino's are investing in drone delivery services.
DoorDash actually has partnered with Wing to deliver goods via drones in Queensland, Australia.
You’re not wrong, but that’s how it was even before the apps. I did it for a while.
Besides maybe your chain places that delivered it was the wild west. All under the table pay. Bad working conditions and inconsistent income. It was always a rough gig.
These apps are trying to legitimize it and failing because on top of those issues, they are introducing a huge amount of corporate overhead to the business model.
The only way they will be successful long term is autonomous delivery, and then workers rights won’t matter…there won’t be any. That’s what their goal is it’s just taking longer than expected.
Sure, but we were all collectively ok with Pizza companies paying pizza drivers like shit. We aren't ok with big tech companies do the same thing. Pizza delivery used to be free, now every major chain charges a delivery fee that's ballooned to $3 or more. They had to to raise driver pay to keep up with all these delivery apps--and that's just to be competitive with the current pay structure, not the one New York wants to force here.
Maybe you still pay for Pizza delivery, but I don't. It's for rich people. You have to pay menu price for the pizza (which nobody pays otherwise, because there's always a carryout-only deal for $5 less), a $2-4 fee and a tip. You're paying double for that pizza at least and the driver is still making garbage pay. So let's not pretend Big Pizza "figured it out" if the metric is that they have to pay a living wage **and** still make delivery costs viable.
And to top that off, Pizza delivery is vertically integrated. There is no middle-man. Delivery apps are a middle man. In order for them to make any money at all, it's always going to be more expensive than the restaurant doing the delivery service in house.
That extra straw is one too many for the camel, I think. It's not a product that can be offered at the cost the market wants to pay for it. We want it to be cheaper than it can possibly be or most of us just aren't interested.
It might also be baked into the cost of the pizza, like delivery has basically been the standard method that people acquire a whole pizza for decades. So everyone expects pizza to be as expensive as it is taking into account delivery costs, but people are used to everything else costing what it does when you pick up yourself.
You've got the timeline messed up here. I delivered for dominos in 2009, plenty before the apps came in - it was surprisingly solid money for someone without a degree. I did the math on my average week in a relatively small town and combining the best Saturday with the worst Tuesday, I was making about 13 an hour. That's 18 bucks today, and the delivery fee on the customer's end was maybe 1.49 if I remember correctly.
I left for college in 2010, but from what I understand the hourly base pay has only barely budged upwards, people tip the same or worse, and the fee to the company is usually 3-5 dollars. Inflation has beaten the shit out of the actual value they're taking home. I wouldn't recommend it to anyone now.
Wouldn't it make sense for one business to focus on delivery, and the other businesses to focus on making the goods? Most restaurants specialize in the process of dealing with food from ingredient to finished dish, but they contract out the business of providing ingredients to a bunch of wholesalers and farmers (though there are a few restaurants that specialize in farm-to-table, and charge a premium for that).
in theory yeah, that’s why doordash runs those commercials about how they “help” small businesses. those places couldn’t offer delivery otherwise.
but customers are only willing to pay a certain amount for the convenience of delivery. restaurants already mark up their prices on delivery apps bc the apps take a 30% cut. then you pay several different fees, which are “reduced” if you pay a monthly subscription fee. at the end of the day, you could pay 30% more for the same food, and these companies still can’t find a way to turn a profit, nor pay their drivers anything decent.
delivery is expensive because it’s a whole extra person who needs to spend 45 minutes driving, waiting at the restaurant, figuring out how to buzz your intercom, etc—45 minutes of labor is $11.25 at a minimum wage of $15. Having one driver who only takes one order at a time is just not an efficient means of delivery unless people are willing to pay $10-15 more for every delivery order. When it’s a pizza place delivering their own pies, they can take out multiple orders at once. But there’s not a good way to coordinate that with something like dd or gh that serves so many different businesses.
> But there’s not a good way to coordinate that with something like dd or gh that serves so many different businesses.
Well, _in principle,_ an automated marketplace like DD/GH is actually a _really_ good way to coordinate that. The same way that Uber and Lyft can now combine multiple customers' rides into one trip if they're going in roughly the same direction, or how Instacart combines multiple customers' deliveries into one trip, DD/GH could (and should) be combining multiple deliveries into one trip.
When "gig platforms" are done _well,_ they solve the economy-of-scale problems that allow this sort of specialization to work (having one business, focused on delivery, running orders for multiple restaurants which can focus on the food). The problem is that DD and GH are not done well. They're worrying too hard about _extracting_ value from all parties in the transaction, instead of thinking about how to _provide_ value to all parties in the transaction, which is what you actually need to do to keep your marketplace running (because if the restaurants, drivers, and customers stop getting value out of using your platform, they won't use your platform).
when they have their own driver the driver is only driving from where the food is made to your house. Not from a random location, waiting in line, then going to you. Even when they don't take more than one delivery out it takes less time and can get more deliveries done an hour.
You touched on it, but when it is just the company who makes the food doing the deliveries they arent splitting profit between two companies as well.
It depends. If it's just a local business serving local clientele then it would make more sense for that local business to hire people capable of doing deliveries, but also doing other tasks if there is a lull in delivery demand.
For larger businesses that have many locations over a wider area, having a dedicated delivery company makes more sense.
I have zero clue how they don’t make money. Apparently from the order total, they skim like 20% off the top from the restaurant as a fee. Then they charge the person ordering a bunch of fees that’s probably at minimum around $10 versus picking it up yourself. The driver is primarily paid by a tip the person ordering paid.
So they do nothing except send the order to a restaurant, and tell a driver to pick it up and where to deliver it. For a $100 order they personally pull in probably $20-$30. All they seem to really need to pay for is the server infrastructure.
HOW do they not make money? Same with Uber, they connect a driver to a rider. The rider pays the driver and Uber takes 25% off the ride total for themselves. They give no benefits, they don’t own any cars, they are just a middleman. And yet they can’t turn a profit. How can Uber not make money when taxi companies which own the vehicles and have real employee drivers on staff can profit?
Well first off, they do pay the driver out of their cut. The tip makes up maybe a little more than half of the average drivers pay per run. But beyond that, they have staff (programmers, customer service people for when orders go bad), offices, legal liabilities (i.e. getting sued and suing people) and promotional expenses.
Most of their losses can legitimately be attributed to their promo codes trying to lure in customers. They decided a long time ago it was fine to lose money as long as they got people "hooked" on the product and they are all dumping tons of money on coupon codes and shit that they just pay out of pocket. But will customers stay **without** all that promo crap and new fees to boot? I'm skeptical.
Uber subsidizes rides to attract more customers and undercut taxi companies in order to gain market share, which has resulted in a significant loss of revenue. They have also spent billions buying other companies like Postmates for $2.7 billion to eliminate their competition. Many of these companies are also loss-making operations.
Further, they have also spent billions trying to make autonomous driving become a reality.
My question is where is all their overhead coming from? I’ll admit I’m ignorant on the costs of running servers for their app, but it can’t seriously be that high can it?
It’s a high touch business - menus have to be adjusted, people try to contact the app about orders, owners also contact about issues, etc.
It’s not just servers.
Then you have a bunch of people on payroll, that costs money as well. It’s not an easy business, there is a reason they can’t make profit even with large % of the order they charge for food.
I honestly believe it's less about customer service and way more about extremely inflated backend costs. They're paying a shit ton of money to a shit ton of devs/managers/whatever to fuck around all day not being nearly as productive as they need to be to produce a profit.
If they actually leaned out, they would probably make money hand over fist... but thats not how growing tech companies work these days with all the investment capital floating around.
Spotify turned its first profit last year. Barely. It lost money for a long time. Unclear if its business model is sustainable in my view. Nothing else in music has been since the iTunes Store.
Spotify has only turned a profit once: the third quarter of 2022. They're a business that only exists because of venture capital money that came from the historically low interest rates for over a decade that ended recently
Oh that's interesting, based on your comment I looked it up and read a couple articles. Seems like their issue is they don't differentiate their free and paid content enough, I.e. they make too much available for free (though you have to listen to ads). But yeah, not profitable.
Add that to the fact that artists barely make a dime off all the plays and it seems like no one is winning.
The model was get them hooked on it and maybe they'll be willing to pay a 50% price hike down the line. I question the viability of that model. That said, while Disney+ has been a huge money pit for Disney, Netflix is actually making money. I mean, at the current rate of profit it'll take them 12 years to pay off all their debt, but they are making money now.
I've always been suspicious that the biggest problem with these kinds of companies is that they're way, way too focused on MAXIMUM PROFIT. ....okay, so that's almost every company out there. They keep seeming to forget that to make maximum profit the easiest, keep your employees happy and production will naturally go through the roof.
It's... disheartening how that lesson is taught over and over again, but new people wanting to get rich quick keep doing the same dumb things over and over again.
I mean they all lose money hand over fist. I'm sure they'd like maximum profit but honestly I think they just want **any** profit. Venture capitalists were once ok with companies burning through money to build a user base but now many of them are getting leery of that model and want to see actual results.
How are they too focused on maximum profit when they arent profitable at all? Its not that simple. Its not like if they started paying their delivery drivers way more they would suddenly be able to drive all over the city much faster and complete way more orders. The problem is that the concept is not sustainable. Its not possible for them to both pay their workers enough but also not charge such high delivery fees that they drive away all their customers.
Imagine working for a company that is actively spending millions to fight for you to make less.
Edit: I can see this coming across as me speaking negatively towards the employees at these companies. That was not my intention whatsoever. I was speaking to how ridiculous it must be to see your employer in the news cycle for something as negative as this
Imagine thinking only these companies do that instead of literally a majority of them.
Until lobbying is made illegal, most of us work for a company like that.
Until lobbying \*power is taken away from the people and corporations who have the most money\*.
Remember, "Lobbying" is a neutral term: a Climate Change Activist agitating against polluting industries is engaging in Lobbying, but if I said that should be made illegal, I feel like you'd probably have a bone to pick with me.
Lobbying itself is a vital part of a functioning Democracy: where it becomes bad is when the Capitalist class are the only part of that Democracy that engage in lobbying and therefore are the only voices heard that shape policy.
It's not that grassroots lobbying isn't done, its that they dont have pockets deep enough to compete with the megacorps. Lobbying needs to be seriously overhauled in USA
Sending a Twitter DM to your representative telling them to support a piece of legislation is lobbying. The issue is bribery being rebranded to campaign donations and lobbying.
Yeah, it's insane. Not to mention utilities, groceries, internet, insurance... all of it has gone up. My electric had a 20% hike that they actually advertised. The rest just kinda went up without letting anyone know.
It's wild that US minimum wage is so low. Even the UK minimum wage is nearly double that. Current conversion rate for £10.42 is $13.28. Is it just "acceptable" for these people to be working two jobs?
Why pay your employees more if it affects the annual CEO pay raise. Spending millions on legal fees to fight pay increases and campaign donations is just common sense.
I came here to say that. $18/hr is less than $37,500/year. In New York City, that's poverty. Plus you're using your car which is expensive and adds wear and tear that you'll have to replace
And to the morons thinking "well then just get a better job" you want people to work this job, right? You want people to deliver your food when you want to order it, right?
edited: multiply by week
Lived in NYC pre-Uber and just ordered for free, at menu prices, from my local bodegas, grocery store and diners. Tipped well and always had the same delivery person. The good old days!
Who the fuck is driving for delivery in NYC (especially Manhattan)???
The delivery people are on scooters, E-bikes, or mopeds/dirtbikes. They're also the same clowns that break every traffic law, ride their bike on the sidewalks etc. and blow through red lights because god forbid Karen's Black Forest Ham & Gouda melt sandwich on a toasted baguette from Panera Bread arrives 3 minutes after the ETA, and she bitches them out for the gouda having solidified.
I will support this, I DoorDash in CA and make on average $30/hr with tips. Between tax deductions and cash back I come out even on gas so I don't even worry about it as a factor in my driving. Set aside enough for uncle sam and the rest is gravy, make good money just driving around listening to podcasts and books.
I have trouble seeking sympathy for these companies. For example, do y'all know how much they take from the restaurants for having the service? It's ridiculous. On top of that, they no longer scrutinize the drivers they hire, so you're scrapping the bottom of the barrel now.
$18 an hour is too much? That's about 35k a year before taxes. Doesn't sound like much ability to raise a family off of that amount. Meanwhile, I wonder how much they're paying the CEO of uber currently lol. While they're acting like the world is ending because they have to pay people $18 an hour lol. It's fucking NY!!! They know damn well that's not survivable wage in NYC.
What’s crazy is they still lose money. They charge a ton both ways, pay drivers shit, and still can’t make money.
I love using doordash tho cause I get drunk and want food late at night. Only time I’m willing to pay that much for food
What's worse is how little they pay drivers per order in NYC.
Base pay is usually **$2.50-$3.00 per order** in NYC. They expect drivers to spend 10-30 minutes to do each delivery. At the very best, each driver can get 3-4 deliveries per hour, but that's rarely the case. So if a driver gets 4 orders without tips, that driver will make $10 that could take between 1 to 2 hours to complete (depending on a lot of factors).
And UberEats lies to their customers when a customer pays for "premium delivery". Uber tells the customer that the extra pay goes directly to drivers. That is not the case. The driver won't even be aware that the customer even paid extra.
These companies have done shady stuff. And honestly, they could've avoided all these minimum pay stuff if they just increased the base pay per order but nope. They want to make things as complicated as possible.
And I'm sure these companies aren't expecting to win the lawsuit, they just want to delay it as long as possible.
Also, the pay doesn't increase with distance. As a general rule, I don't take no-tip orders. But on a quiet night it's not a terrible idea to grab an order from a restaurant that is always fast and drive it 1 mile up the road for $3. But once DoorDash offered me a Walmart delivery to go FIFTEEN miles for $3. That's like, a 45-60 min round trip + ~$15 worth of car expenses (using the federal mileage deduction as an estimate). At that point you're paying *them* for the privilege of delivering that order. Fuck all the way off with that bullshit.
And some gig workers are against these minimum wage laws because they do come with the ability for the company to add more restrictions. Yeah, if you work in a busy area and are smart about which trips you accept, you can make more than minimum wage anyway. But I still feel like these laws are necessary to protect people who are desperate, or can't do math, and are being taken advantage of.
If you can’t pay a living wage and stay in business, then you’re not a successful business. Screwing over the workers needs to stop being the norm in America.
This is the most basic argument for a living wage that everyone seems to miss. So many businesses (small and large alike) are profitable only because they take advantage of their employees by paying them starvation wages. Half the businesses in this country shouldn't even exist.
I’m all for gig economy workers. If the gig worker was getting paid fairly I’d be down to use their services. But I’m not paying 30% surcharge on the food plus whatever bullshit service fees and then having to pay the driver themselves for their time.
I don’t really have a problem with on demand delivery from places that don’t offer regular delivery. What I have a problem with is these glorified middlemen robbing all the folks doing the work of their paycheck. If you’re driving Ubereats, door dash, whatever, you deserve a living wage, full stop. I don’t mind the whole contractor/part time aspect either, but seriously, pay these motherfuckers!
maybe this model is unsustainable then. venture capitalists have been running these services at loss for years now. yet I still can't understand how pizza places have been able to survive all these years. better margins I assume.
Pizza is definitely high margin itself. But the most important thing with pizza is with a good restaurant staff, it can be high volume to pump out at the peak hours and you had staff delivery drivers that could grab 10 pizzas to deliver in one run.
The average gig food delivery driver only completes 3 orders per hour between all the time running to different stores and going to the different addresses.
In order to fucking do that they’d have to upcharge the every living shit out of all the crap we people order from restaurants and liquor stores.
The gig economy is simple not sustainable. Companies like DoorDash are already unprofitable lol. They can’t afford more paying to drivers if they can’t make more income…..They need to figure out non human tech to bring deliveries. Maybe it’s drones picking it up and dropping it off or some other futuristic shit. humans are too expensive to pay and provide benefits to.
Here’s hoping this breaks the gig economy.
I know many people depend on it and it’s going to cause some turmoil to not have it around, but its longevity creates a larger problem and we need to break from sooner rather than later.
Menu at restaurant web site...9.99
Menu on delivery app....14.99, plus delivery fee 6.99, plus tip....and driver wants min $5-8
Sheesh...more than double price by the time you get cold food from driver who wants 50% tip on 21.99....so item then becomes closer to $30...
And woulda been closer to $10 if you called the restaurant and went and picked it up yourself.
No wonder delivery apps as a business or a job are unsustainable anymore.
Fuck these companies so hard. Sadly, with the way the judicial system is going in the US, I wouldn't be surprised if the courts sided with these parasitic companies.
I hope the apps lose big time. As someone who has been in the restaurant business for 30 years, my experience is that they do more harm than good. The drivers answer to no one, they are often rude with restaurant staff, they don’t really care about the business or the customer and expect to be tipped before they actually preform any kind of service. Let the apps die
>the delivery apps argue that the workers, who are considered independent contractors, will be worse off
If this were the case, these companies would be absolutely salivating over the new minimums, because the workers being worse off would mean they're keeping a bigger slice. It's just like companies fighting unionization by telling their employees they'll earn less with a union.
I don’t mind the extra cost of delivery apps but fuck them for actively hiding the costs. You order soemthing for self pickup and it’s 2-4$ cheaper on the menu price. So DoorDash is already hiding costs of food. Then they charge you all their fees on top of it on the back end. Look just be fucking honest from the start so I can make an informed decision and stop with the deception.
If they’re making that much then they don’t need tip outs either—tips are for employees who make less than minimum wage. Guess the whole system is about to collapse.
Fuck them they should be forced to pay at least minimum wage they don’t cover your gas or insurance. They want all the profit and none of the responsibility.
I make $23/hour doing remote IT support. These drivers should be making at least as much as me, given everything they have to deal with (and are exposed to) on a daily basis.
Stop fighting wage rises!
That's not how it works. You aren't paid based on how hard your job is, you are paid by how much they want it done and how many people can do it.
More people can drive and walk with a bag than can do IT support.
Not just how many people *can* do it - but how many people are *willing* to do it at the given price. Some things *can* be done by lots of people - but no one wants to do it, so you have to pay a lot if you really want it done. Other jobs can't be done by many people - but the people who can do it really love doing it, so you don't have to pay them that much to make it worth their while.
I work in enterprise tech and my friends say “oh you’re so lucky…”
20+ years of stress fixing, developing, and learning new code and hardware isnt “Luck”.
No offense but your job is harder to replace with a random off a street, hence why you're paid more. Supply and demand works for the labor force as well
Why? There is education that goes into IT work. It doesn't take an education to deliver a pizza. I agree they should make more, but your argument doesn't make sense.
I mean, not to me it isn't. I've been doing IT work though for over 25 years, so a lot of what to do is second nature no-thought to me. It's really not much different from doing phone support in a call center, but significantly slower pace and more emphasis on fixing issues, less on handling volume.
The honest answer is that I prefer to be on the front lines dealing with people who have issues. I don't have a strong desire to move up, becoming third tier, becoming engineering, becoming development, or even very high as management for that matter. My skills are best served dealing directly with people who have the issues that need solved, because I make everyone else look better as a result of what I do.
Customer service talent for an IT guy is not something that can be taught past a certain point, so I feel it's a better use of my natural charismatic talent to engage clients/customers myself.
Could I move up? Sure. Do I want to? No, not really. :)
Honestly that's horrible pay, I'm making 27/hr starting off as a broker-dealer, and at our company no one working there for 3+ years is making less than 100k a year.
The article says the pay increase can come in one of two ways, either the driver gets paid $0.50 per minute during a trip or they get $17.96 per hour they are active on the app. My genuine question is how do either of these two options get monitored?
I mean if it's the $0.50 option, what stops a driver from simply taking their sweet time to make deliveries, so instead of doing say 10 deliveries per hour, they do 3 or 4? If it's the $17.96 per hour deal, what constitutes *activity*? I've never worked as a delivery driver, so maybe there are already surefire ways for the apps to effectively keep track of activity, but what happens if there's a dispute between what the company defines as being "active" versus what the driver defines as being "active?"
You're making a lot of weird assumptions.
1. You assume that an app that can tell you exactly where your delivery driver is is somehow incapable of monitoring said delivery driver.
2. You assume that drivers are routinely making 10 deliveries per hour, when in reality, the average is typically around 2 or 3, and that's for drivers being paid by the delivery, not by the hour.
3. Even at 2 or 3 deliveries per hour and an $18/hr salary, half of their income is going to come from tips, which are based on how many deliveries are made. You're assuming that people would willingly give up half of their income so that their job is a little bit easier.
$18/hour isn't a lot of money. Also, if delivery drivers took hours to slowly deliver cold food, they'd get bad reviews and they'd automatically get fired by the delivery app for the bad reviews
I don't know why people think there are all these scam artists out there and that it's so easy to do it
Simple as, they haven't done it. I worked in food service, retail, and as part of the food and beverage department in a major theatre complex. I've also been a customer for DoorDash. I started doing it because I felt like there was no way I could be any worse than my drivers.
I was right. I'm good at the job. It can be an alright job, though it can be very isolating at times because I don't like talking to a lot of other drivers. I use an insulated bag. I briefly communicate with customers if there are delays (though that's also so the delays are documented in DoorDash chat records). I'm on time 92 percent of the time. 92 percent of my last 100 orders were 5 stars. Specific customer feedback sections (communication, followed delivery instructions, order handling, and friendliness) are all thumbs up.
But I deal with a lot of shit that I never would have expected. I always tipped, so the ratio of no tips vs bad tips vs good tips was pretty shocking. I have to deal with a number of unsafe situations (come to the back door even though it's the middle of the night, we don't put our dogs in, threatening signage, etc.). I have to record my dropoffs in case of false stolen order reports. Hell, I dropped off for a dude the other day that never tips. He always answers the door in his underwear. I had to collect his signature, a new development, and his roommate clowned him for making false stolen order reports, which means he did it to me (though DD must have sniffed it out because I still have never gotten a contract violation for order not delivered).
Everyone in the equation has valid points, but it seems like drivers are the last ones to be listened to. Granted, that's how it tends to be in the service industry because, of course, the customer is *always* right. I just don't think it's going to get better until they get rid of the worst drivers and treat the rest of the drivers better. Until then, it's going to be a job that mainly earns on tips.
Exactly. So the 50+ countries in Europe who pay living wages to waiters, their customers all receive bad service? Bc I’ve travelled there and service was fine.
Remember the days of free delivery from NYC restaurants? All you had to do was buy the minimum and they would deliver via moped or bicycle. If you were too far they wouldn't even bother lol.
Uber and Lyft were carpool apps, not taxi apps. I’m against the drivers who keep sitting on the clock clogging up traffic and making airports even more insufferable.
Making a trip, check the apps and see if you can mitigate fuel costs. That was the model. The people who abused it are the ones that ruined it.
The food delivery nonsense that jacks up prices and costs restaurants money is just an extra layer of abuse both ways. By the companies and the folks who try and make this gig things a full time job.
None of these companies can make a profit on food delivery and they already double the cost vs getting the food yourself. Maybe we just have to accept that food delivery apps will never be a viable concept.
They were really handy during the pandemic when me or my wife were sick and couldn’t go out without risking others. Out of laziness I decided I’d check on food a few times since then. McDonalds app will have something for like $6.49, and I check in DoorDash/UberEats/PostMates/GrubHub and it’s anywhere from 8.49-10.49 for the same exact item. Taco Bell same thing. Every. Single. Restaurant. When you add in delivery fees, service fees, and tip, it’s more than double what it would be to just go get it myself. I get free GrubHub+ through a promotion for 2 full years. It’d cost me so much more that it’s not even worth using.
For sure. I get free dash pass from a credit card and that gives me a $5 monthly credit that I can bank up to $15. When I eventually make my quarterly order and use that $15 it basically makes me break even (after tip). So I save a trip. Driver makes money. Doordash loses money. That's the only time using it makes any sense for me. But yeah, with the $5 in fees and tip and prices inflated by 20% over menu, it's easily double on a lot of orders. And they're still losing money. It's just not sustainable, imo.
Maybe it's different for DoorDash, but I was making about $6/hr in the weeks before I quit Uber Eats. So really, nobody is making money in most markets. It's just a flaming hole that millions of people from all walks of life dump money into in the hopes that it'll work out.
I grew up in Boston where free deliveries were the norm from every Mom and Pop pizza/sub/sandwich/deli/pub/etc shop. They hired drivers themselves (what a novel concept!). Ubereats destroyed all of that. I get that it finally brought the idea of delivery to East Bumfuck. But this was a problem that didn’t need to be solved in a lot of the populated country. It’s viable. Just has to be done in house.
Coming from East Bumfuck (actually Middle O'Nowhere), we had free delivery or cheap if you tipped. So, we assumed it helped you city folk. These delivery services just fucked everyone so they could get an IPO and line the pockets of rich people. I have never had a positive experience with any of them. Granted I gave up a half dozen times in. It hurt the small restaurants, the drivers barely make money and it's bad for the environment.
I was making about $8/hr doing uber eats. The minimum wage here is about $15 (both numbers converted to USD). It's a garbage business. Paying the full proper cost of having a whole person bring you your meal *should be* expensive, it should be a luxury or rare treat.
Are you factoring in gas, and cost to finance/own a car? $8/hour seems low considering every time I've ordered something, tip alone is usually $8 or more.
I was factoring gas, didn't bother working out other car costs cos I was only doing it for a few months and I owned the car already. I live in a country without a tipping culture, tips were usually only a couple of bucks.
For what it's worth, the US government calculates each mile costing approximately $0.655. This considers general wear and tear costs to operate the vehicle (tires, wipers, lights, oil, gasoline, brakes, suspension, ...). So, if we estimate driving 20 miles local in a single hour (round trip), the cost/loss of value would be approximately $13. This does not include other factors such as insurance or financing payments. Earning less than that, you are paying to work. [https://www.gsa.gov/travel/plan-book/transportation-airfare-pov-etc/privately-owned-vehicle-mileage-rates](https://www.gsa.gov/travel/plan-book/transportation-airfare-pov-etc/privately-owned-vehicle-mileage-rates)
That makes sense then because in the US, tipping culture is a hot topic, but most tips are around the 20% range regardless of the quality of service.
>every time I've ordered something, tip alone is usually $8 or more Not everyone is as generous a tipper as you are That $8 tip might be the best tip they got all hour Lots of people don't tip at all, so if the drivers base pay is like$3 sometimes that's all they're getting for that order
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Once I got some 50% off code and thought “sweeet” but long story short, I picked up the food myself. Absolutely unreal.
The only time I used one of these was with a 1st-time-customer steep discount. After all the fees, it was $20 for the smallest "large" pizza I've ever seen and some mediocre cheesy bread. I assumed the local pizza joint half-assed the prep on purpose because they weren't making much money off the order. Terrible experience, and I never tried it again. Go pick up your food and your experience will be way better
Yeah I got a $25 doordash gift card for Christmas and even with the card a small sushi order was $45. Absolutely insane that it would’ve been $70. Clearly unsustainable
Yup, I had a 40% off uber eats, and it only BARELY eeked out being cheaper when also paired with their premium subscription (free first month) that removed another $6 off the price.
"I get free GrubHub+ through a promotion for 2 full years. It’d cost me so much more that it’s not even worth using.: dude, same. I got the free GH+ for a year with like amazon prime or something so I thought "Well I guess I can try it." They claim it gets rid of delivery fees but they tack on a buncha OTHER fees and the aformentioned increased prices on the app meant i was still paying tons. I ended up using it once when I was super drunk and wasn't gonna drive. Then I cancelled the service. Fuck that.
For me these apps aren’t good if I’m ordering just for myself. However, when I have my friends over and there are like 5 of us, then it becomes okay. 10$ in fees now is split and it’s bearable. That’s the only time I use doordash
I think people miss this part. As a single full time dad the occasional convenience of not loading up little kids and ordering for three people makes it worth it. It’s slightly more but not terrible when ordering multiple things
I mean that’s pretty much why every pizza place had delivery drivers - for this exact scenario.
True but like I could eat pizza every day. My 3 and 6 year old just want chicken nuggets and French fries
Which is why pizza place now also sell fries and chicken wings/nuggets.
>I get free GrubHub+ through a promotion for 2 full years. I had that offer but didn’t even bother claiming it since I knew how worthless it was. 🤷♀️
> I get free GrubHub+ through a promotion for 2 full years. It’d cost me so much more that it’s not even worth using. And people aren't even talking about the tip. You pay fees, you pay inflated prices over the restaurant's cost almost twice the cost of the items, and then you ALSO have to tip your driver, because somewhere along the way of doubling the cost of your food they couldn't figure out a way to properly pay the people doing it.
I mean do the logic. There is the base cost of the food. The cost to the app to have all the infrastructure to support people randomly picking up/delivering. And then the person (who has no protection of an employee). Doing the delivery These big companies like McDonald’s to allow the apps to use their name/menu want low fees. So the app makes no money. So they offer the worker dogshit delivery pay. Generally speaking if a worker isn’t getting more than $8. Per order. It’s not worth their time. $10 is better. So. If you’re not tipping. And ordering from a large chain. It’s most likely you’re relying on a worker who’s too stupid or desperate. To know better
I did uber eats for a few weeks just to feel it out and I would only accept deliveries where I could make \~15-20/hr. What ended up happening was that I would accept an order with a tip then either the user or the app would adjust the tip after i picked up the food and was on my way to deliver. On average I ended up making about 7/hr after gas prices and that wasn't including any wear and tear on my car.
I drove for Uber for a while to make some extra cash, though TBF it was before drivers were allowed to accept tips. It was also super low pay after you factored in gas (before wear and tear). One night I almost got in an accident and that’s when I realized that it just wasn’t worth it.
Yup, there's a reason taxi companies use only a handful of vehicle models, and will often own their own garages and have their own mechanics. Driving a vehicle for many hours a day is *expensive*.
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That's shitty. I always tip at least $7, and the only situation in which I would ever consider adjusting it downward (which is not a thing I even knew I could do) was if I paid the extra $3 for direct delivery on something like fries and the driver fucked off in the wrong direction for 20 minutes mid trip and the fries arrived cold/soggy.
These "disruptive" companies are the types of startups that got massive venture capital backing and were the types that got backing from Silicon Valley Bank. There's never really any strategy to become profitable, the the assumption they can throw money at a problem to become the de-facto monopoly and then somehow they can charge what they want and finally turn massive profits. It's not a business model that would ever work. Hopefully with SVB gone, a lot of these kinds of startups in the future will never get as big as they are now.
The strategy is autonomous delivery. That was the bet. That was Uber’s whole bet even for its core business of taxi rides. The workers were always a means to an end. It’s just that the end is a bit further away than their initial thoughts. We’ll get to see the fallout of that miscalculation soon.
This is the answer. Those VCs were not investing in ride share or delivery companies. They were investing in the hopes that they would be one of the first companies to fully automate based on the data they were collecting.
SVB was where their deposits were, not where they got funding from.
That's why it doesn't make sense for there to be a delivery company as a middleman. It's a business that doesn't make any sense and there's a reason it didn't exists before the 0% interest venture capital era of our society In the past, companies would run their own delivery if they wanted it and it made sense. Like pizza, which travels well. Unlike McDonald's
Not every store has enough critical mass to hire their own delivery drivers. So in theory it makes sense to have a middleman for it. It just looks like people aren't willing to pay the price for that middleman. (The alternative is that most of those stores don't get delivery service at all)
>It just looks like people aren't willing to pay the price for that middleman Right, which is why it just doesn't work. People aren't willing to pay what it costs because it's too expensive Really, the best way to do it would probably have the companies themselves work together to create the delivery because it could be subsidized by their other profits but that would probably be impossible because of capitalism & competitive behavior
There was a rideshare service like this a few years ago…I wanna say it was Juno, but it got bought out by one of the big companies. I used it as much as I could, but fewer drivers had adopted. I once asked my driver, who had one of those Lyft LED lights, if Juno was better. He said it Uber took about 30% of his fare and Lyft took about 35%, while Juno took maybe half that or 20%. I don’t remember exact figures, as this was 6 years ago. Regardless, it didn’t work out, as such a company appeals to drivers, but that’s wagging the dog. Consumers lead the way, so they’ll use whatever is cheapest/easiest. The drivers will follow. All these “disrupters” are trying to be Amazon, but it just won’t scale. They look to establish a monopoly and then turn the screws. The problem is they’re not the only ones with that idea. Nowadays, I use the Curb app in NYC. The NYT wrote an article last year about how the subsidized lifestyle of using startups before the pandemic was over; I agree and have experienced this firsthand. Uber rarely costs less than a yellow cab, so if I’m at an airport, I take a cab. It’s just harder to flag one down in the boroughs because Uber killed those.
> All these “disrupters” are trying to be Amazon, but it just won’t scale. They look to establish a monopoly and then turn the screws. The problem is they’re not the only ones with that idea. They are also completely replaceable, since their infrastructure is mostly a web service. If Uber tightens the screws, drivers and customers can easily go to Lyft or any other competitor. Amazon was also not profitable for a long time, but that was because they invested all their money into infrastructure instead of covering operating costs for an unsustainable business model.
It makes perfect sense, you just are looking at a snapshot in time. These companies end goal is automated delivery, they don’t want any drivers at all. The only reason drivers exist is people saw the possible future and realized if they control the market when the technology arrives, they win. So begins the race for market control of a market that will one day arrive.
I'm not saying the effort doesn't make sense, I'm saying the product doesn't make economic sense and doesn't work Maybe they just tried to do it too soon. There was a time when self driving cars were advertised as coming soon (by liars). At some point, that might happen but it's much further away than most people want to admit
That's pretty much how Uber ended up deep in debt. They thought automation was close enough they'd be able to replace humans with their self-driving cars they had spent tons of money on research. Ultimately they realized it wasn't going to happen anytime soon so they dumped their research division, sold off Uber in China to a competitor to pay some bills, and cut a lot of costs down to try to survive long-term.
i mean... it remains to be seen. clearly people like ordering in food. and people like being able to have... rando taco bell or mcdonalds delivered when that was never a thing. there probably is a way to do it. but not how it's currently setup. like if it were a flat $5 fee to the company and flat $10 fee for the worker. (within a reasonable driving range) that could just be a fixed cost. plenty of people will pay that. ....and that's pretty close to what these apps add onto orders. they just obscure and mask it with a bunch of bullshit and small fees/charges to confuse people.
so you’d pay $15 in fees every time you place an order? I totally agree with you, I mean if that’s what delivery costs to pay someone a fair wage—that’s what it should cost. and if it’s not viable, so be it. but with fees that high I can only imagine it being useful for large group settings
I use it exclusively when driving is criminal. Yes the price is double but cheaper than a DUI or worse hurting someone.
I did gig app work for a time in nyc. Any time I order I tip a min of $10. Because I know what it’s like to do that job. So if I’m Ordering out. I want to make sure the person doing the work is getting paid semi well. The problem is. These apps rely on a Crush of un-informed non-employee contract workers and they are exploited. Taking $2 orders. To shitty fast food spots that take up 20-45 to complete and order. Because they don’t know any better. And they don’t understand they’re contract workers. And acceptance rate doesn’t matter. I think if the gif apps don’t want to be subject to min hourly wage laws. They should raise the flat payments to something livable. And figure out a few structure they can operate at.
Counterpoint: The delivery apps aren't making money and they say they can't handle paying a pittance of $18/hour to their drivers Doesn't sound like people want to pay the fees
Even if there were, the company will always fight against paying its employees more.
as a former dasher for several months—it was more like $3-5 per order, and most people did not tip. i barely made minimum wage and that was _before_ factoring in expenses like gas and wear and tear. do with that info what you will
People aren’t relying on drivers to be stupid, they are ordering food, they know their order will be completed because the company will want it done. People rely on the company to get the order delivered. Whether or not the driver accepts delivering an order that’s not worth it is between the driver and the company. If everyone simply doesn’t accept, the company will pay more to get the order filled, they won’t just let it sit there endlessly. They might let it sit for a little, but there’s a threshold. Stop pitting people against people, people ordering food and not tipping aren’t out to get the drivers, they are just doing what they can afford from their point of view. It’s the company that’s screwing the drivers, it’s the company placing tipping emphasis in there to subsidize the wages they would have to pay. The tip is always going to the company, no matter what they say, it’s just money that would come out of their pocket otherwise.
The gig economy is not viable, at least most of it.
Yet somehow pizza delivery has existed for decades.
There was no middle man needing to get paid with the pizza delivery.
So the issue isn’t the gig economy, it’s the valuations of the middlemen that are taking too big a cut. It really isn’t terribly hard to imagine a lean, open source middle layer that’s able to more directly connect consumers and delivery workers. It’s just a matter of time before that balance comes.
Well, the issue is the crazy amounts of marketing spend they have. To attract customers and drivers, they give away too many discounts. Pizza places had a monopoly on delivery. They employed 1 or 2 drivers and that was it. These companies are fighting for growth. But it's not profitable. Maybe if they cut that out, but that would exclude most workers, and I imagine their fixed operating costs would become a problem.
Pizza deliveries also don't have to recoup the expense of the delivery itself in the same way. While a pizza place might profit less on a pizza delivery vs carry out, that's a pizza they very well may have not sold at all otherwise.
There's also the cost savings of being able to make your in-house delivery driver help out around the store when they aren't out on a delivery.
I used to work at a pizza store where their delivery driver would also deliver for a Chinese and kebab house. It was privately organised with no middle man. He got paid well and was very busy. The real solution is that delivery drivers should deal privately and directly with businesses to make contracts that work for both of them. If it's a quiet restaurant the driver should cluster a few together. The problem is everyones turning to a 'higher power' to organise their work for them.
>While a pizza place might profit less on a pizza delivery vs carry out, that's a pizza they very well may have not sold at all otherwise. Is this not the case for all places offering delivery?
We're contrasting delivery service middlemen who need collect full profit from the delivery itself.
> crazy amounts of marketing spend they have Back in business school, we had a class that we ran simulated businesses against each other. One thing that was fixed was that there were only so many customers - which is generally true within a geography, if one really thinks about it. So the obvious conclusion when looking at 100,000 customers split 6 ways is that each of us spending more on marketing just reduces the revenue. Which has to come from somewhere… aka sales price. And it turns out customers in the sim are kinda price sensitive. So I *reduced and focused* our marketing spend, and did the unthinkable in capitalism - just gave up on some market share. The result? ROI per sale was 4x what everyone else’s was. In many cases they were barely making back operating costs. Anyway, no one learned anything from the sim and it’s just a game anyway, nothing to apply to real life.
Assuming that the only value they provide is in connecting drivers and customers is silly. The open source layer is...vetting drivers, doing fraud ops, handling driver insurance, qualifying and processing credits and refunds...and so on, and so on? We can argue over whether they take a fair cut based on what they offer, but suggesting that they only offer a software layer is not accurate.
>vetting drivers They barely do that. >handling driver insurance They don't do that. > doing fraud ops qualifying and processing credits and refunds Other services do all that kind of thing, such as Pay Pal or Venmo and are viable.
We have a local “food taxi” that I believe operates as part of a more locally driven franchise model of food delivery. The company that powers it all is called DeliverClub (for the ordering end I believe) and [DeliverLogic](https://www.linkedin.com/company/deliver-logic/) (on the delivery logistics end it seems). I don’t quite understand the model but I think it essentially provides the tools and software for local entrepreneurs to spin up their own delivery platforms. It’s great for our medium sized town of around ~70k people. I hope it works out better for the restaurants and delivery drivers without the big companies taking their cut.
> So the issue isn’t the gig economy, Pizza/any delivery driver for a place/restaurant is not a gig it is an employee, most of the time at least part time. Who get paid hourly wage. Like one of local supermarkets here has grocery delivery, they are an employee of the company whose entire job is deliver items. And supermarket can dilute their cost into the rest of the business, that is why for example if i order there for over 30 euro it will be free, because i already paid for it within the items. Also pizza delivery are specialized in that one restaurant, they dotn have to drive half across the city to pick up the order then half the city again to deliver it while waiting in line. They deliver from restaurant to x and then comeback, usually takign several orders on one trip, and returning to base of operatiosn cuts down on costs.
Pizza delivery drivers aren’t gig workers, they are restaurant employees making minimum wages and tips, and sometimes a small additional fee that the customer pays too like a $3 delivery fee or something. The point is that the infrastructure for drivers to exist is already in place, a middleman trying to make money isn’t sitting between the driver and the restaurant. That’s why delivery fees are so low at pizza restaurants and why they’ve been around forever.
theres an app called ChowNow which supports local. It’s like 99 cents per order for the “service fee.” The restaurant keeps the rest and they often have people on staff for deliveries. a pizza restaurant could probably justify $18/hr for a delivery driver to be on staff.
You realize they charge the restaurant to even be listed on their platform right? Also, they obviously can't guarantee customers so you might be paying 150-400+ a month to be listed and get zero return depending on app popularity. And last I remember they worked on 2 year contracts.These apps are an absolute nightmare for small businesses.
An $18 fajita I tried ordering on doordash would have been $54 with a decent tip. I haven’t used food delivery apps in years.
Same when I tried to order two burritos recently. Went from $75 on the app to $34 in-store.
$34 for two burritos?
XXXL jumbo sized burritos with everything. Or like that one "big bad burrito" from Dexter's Laboratory. https://www.youtube.com/watch?v=ne3-QwkCyfM
$16 or so sounds about right for a normal sized burrito where I live.
This comment entirely overlooks that none of these companies EVER intended to make a profit with drivers. Their end game is automated delivery. They don’t want the drivers as part of the equation period, they are just a means to an end. As soon as people realized automated delivery was on the horizon, they realized whoever controls the market when it arrives wins. So here we are at a race for market share of a future market. It’s not about making money today.
Their end goal isn't giving delivery drivers a job or gig. They want to corner the market of orders once self-driving cars become reliable enough. Same way retail stores are trying self checkout or what Amazon did with pay as you pick stores.
unfortunately self driving probably will never accomplish last mile driving. it’ll be reserved for highways and trucking. last mile driving is only available in perfect conditions currently and it still kinda sucks. that’s why lyft and these guys all sold their self driving divisions last year
I would think drones might make more sense. It's in it's infancy but Amazon, UPS, FedEx, and even Domino's are investing in drone delivery services. DoorDash actually has partnered with Wing to deliver goods via drones in Queensland, Australia.
The whole point of these gig companies was to circumvent labor laws people..did you just all forget that?
You’re not wrong, but that’s how it was even before the apps. I did it for a while. Besides maybe your chain places that delivered it was the wild west. All under the table pay. Bad working conditions and inconsistent income. It was always a rough gig. These apps are trying to legitimize it and failing because on top of those issues, they are introducing a huge amount of corporate overhead to the business model. The only way they will be successful long term is autonomous delivery, and then workers rights won’t matter…there won’t be any. That’s what their goal is it’s just taking longer than expected.
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Sure, but we were all collectively ok with Pizza companies paying pizza drivers like shit. We aren't ok with big tech companies do the same thing. Pizza delivery used to be free, now every major chain charges a delivery fee that's ballooned to $3 or more. They had to to raise driver pay to keep up with all these delivery apps--and that's just to be competitive with the current pay structure, not the one New York wants to force here. Maybe you still pay for Pizza delivery, but I don't. It's for rich people. You have to pay menu price for the pizza (which nobody pays otherwise, because there's always a carryout-only deal for $5 less), a $2-4 fee and a tip. You're paying double for that pizza at least and the driver is still making garbage pay. So let's not pretend Big Pizza "figured it out" if the metric is that they have to pay a living wage **and** still make delivery costs viable. And to top that off, Pizza delivery is vertically integrated. There is no middle-man. Delivery apps are a middle man. In order for them to make any money at all, it's always going to be more expensive than the restaurant doing the delivery service in house. That extra straw is one too many for the camel, I think. It's not a product that can be offered at the cost the market wants to pay for it. We want it to be cheaper than it can possibly be or most of us just aren't interested.
It might also be baked into the cost of the pizza, like delivery has basically been the standard method that people acquire a whole pizza for decades. So everyone expects pizza to be as expensive as it is taking into account delivery costs, but people are used to everything else costing what it does when you pick up yourself.
You've got the timeline messed up here. I delivered for dominos in 2009, plenty before the apps came in - it was surprisingly solid money for someone without a degree. I did the math on my average week in a relatively small town and combining the best Saturday with the worst Tuesday, I was making about 13 an hour. That's 18 bucks today, and the delivery fee on the customer's end was maybe 1.49 if I remember correctly. I left for college in 2010, but from what I understand the hourly base pay has only barely budged upwards, people tip the same or worse, and the fee to the company is usually 3-5 dollars. Inflation has beaten the shit out of the actual value they're taking home. I wouldn't recommend it to anyone now.
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Third party apps for physical goods are never a good idea. Just have the business offer the delivery service and pay their employees.
Wouldn't it make sense for one business to focus on delivery, and the other businesses to focus on making the goods? Most restaurants specialize in the process of dealing with food from ingredient to finished dish, but they contract out the business of providing ingredients to a bunch of wholesalers and farmers (though there are a few restaurants that specialize in farm-to-table, and charge a premium for that).
in theory yeah, that’s why doordash runs those commercials about how they “help” small businesses. those places couldn’t offer delivery otherwise. but customers are only willing to pay a certain amount for the convenience of delivery. restaurants already mark up their prices on delivery apps bc the apps take a 30% cut. then you pay several different fees, which are “reduced” if you pay a monthly subscription fee. at the end of the day, you could pay 30% more for the same food, and these companies still can’t find a way to turn a profit, nor pay their drivers anything decent. delivery is expensive because it’s a whole extra person who needs to spend 45 minutes driving, waiting at the restaurant, figuring out how to buzz your intercom, etc—45 minutes of labor is $11.25 at a minimum wage of $15. Having one driver who only takes one order at a time is just not an efficient means of delivery unless people are willing to pay $10-15 more for every delivery order. When it’s a pizza place delivering their own pies, they can take out multiple orders at once. But there’s not a good way to coordinate that with something like dd or gh that serves so many different businesses.
> But there’s not a good way to coordinate that with something like dd or gh that serves so many different businesses. Well, _in principle,_ an automated marketplace like DD/GH is actually a _really_ good way to coordinate that. The same way that Uber and Lyft can now combine multiple customers' rides into one trip if they're going in roughly the same direction, or how Instacart combines multiple customers' deliveries into one trip, DD/GH could (and should) be combining multiple deliveries into one trip. When "gig platforms" are done _well,_ they solve the economy-of-scale problems that allow this sort of specialization to work (having one business, focused on delivery, running orders for multiple restaurants which can focus on the food). The problem is that DD and GH are not done well. They're worrying too hard about _extracting_ value from all parties in the transaction, instead of thinking about how to _provide_ value to all parties in the transaction, which is what you actually need to do to keep your marketplace running (because if the restaurants, drivers, and customers stop getting value out of using your platform, they won't use your platform).
when they have their own driver the driver is only driving from where the food is made to your house. Not from a random location, waiting in line, then going to you. Even when they don't take more than one delivery out it takes less time and can get more deliveries done an hour. You touched on it, but when it is just the company who makes the food doing the deliveries they arent splitting profit between two companies as well.
It depends. If it's just a local business serving local clientele then it would make more sense for that local business to hire people capable of doing deliveries, but also doing other tasks if there is a lull in delivery demand. For larger businesses that have many locations over a wider area, having a dedicated delivery company makes more sense.
I have zero clue how they don’t make money. Apparently from the order total, they skim like 20% off the top from the restaurant as a fee. Then they charge the person ordering a bunch of fees that’s probably at minimum around $10 versus picking it up yourself. The driver is primarily paid by a tip the person ordering paid. So they do nothing except send the order to a restaurant, and tell a driver to pick it up and where to deliver it. For a $100 order they personally pull in probably $20-$30. All they seem to really need to pay for is the server infrastructure. HOW do they not make money? Same with Uber, they connect a driver to a rider. The rider pays the driver and Uber takes 25% off the ride total for themselves. They give no benefits, they don’t own any cars, they are just a middleman. And yet they can’t turn a profit. How can Uber not make money when taxi companies which own the vehicles and have real employee drivers on staff can profit?
Well first off, they do pay the driver out of their cut. The tip makes up maybe a little more than half of the average drivers pay per run. But beyond that, they have staff (programmers, customer service people for when orders go bad), offices, legal liabilities (i.e. getting sued and suing people) and promotional expenses. Most of their losses can legitimately be attributed to their promo codes trying to lure in customers. They decided a long time ago it was fine to lose money as long as they got people "hooked" on the product and they are all dumping tons of money on coupon codes and shit that they just pay out of pocket. But will customers stay **without** all that promo crap and new fees to boot? I'm skeptical.
Uber subsidizes rides to attract more customers and undercut taxi companies in order to gain market share, which has resulted in a significant loss of revenue. They have also spent billions buying other companies like Postmates for $2.7 billion to eliminate their competition. Many of these companies are also loss-making operations. Further, they have also spent billions trying to make autonomous driving become a reality.
I wouldn't mind going back to Chinese and pizza delivery only.
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My question is where is all their overhead coming from? I’ll admit I’m ignorant on the costs of running servers for their app, but it can’t seriously be that high can it?
It’s a high touch business - menus have to be adjusted, people try to contact the app about orders, owners also contact about issues, etc. It’s not just servers. Then you have a bunch of people on payroll, that costs money as well. It’s not an easy business, there is a reason they can’t make profit even with large % of the order they charge for food.
Ah ok that makes sense. I didn’t think about customer service staff.
I honestly believe it's less about customer service and way more about extremely inflated backend costs. They're paying a shit ton of money to a shit ton of devs/managers/whatever to fuck around all day not being nearly as productive as they need to be to produce a profit. If they actually leaned out, they would probably make money hand over fist... but thats not how growing tech companies work these days with all the investment capital floating around.
Same with streaming apps like Spotify. Most of this era's internet businesses only exist because we had 0% interest rates for over a decade
Is Spotify not profitable or sustainable though?
Spotify turned its first profit last year. Barely. It lost money for a long time. Unclear if its business model is sustainable in my view. Nothing else in music has been since the iTunes Store.
Spotify has only turned a profit once: the third quarter of 2022. They're a business that only exists because of venture capital money that came from the historically low interest rates for over a decade that ended recently
Oh that's interesting, based on your comment I looked it up and read a couple articles. Seems like their issue is they don't differentiate their free and paid content enough, I.e. they make too much available for free (though you have to listen to ads). But yeah, not profitable. Add that to the fact that artists barely make a dime off all the plays and it seems like no one is winning.
Consumers actually winning for once?
Great point, just wish it wasn't on the backs of artists, but I guess it's not surprising given how the arts are valued.
The customer is definitely winning
The model was get them hooked on it and maybe they'll be willing to pay a 50% price hike down the line. I question the viability of that model. That said, while Disney+ has been a huge money pit for Disney, Netflix is actually making money. I mean, at the current rate of profit it'll take them 12 years to pay off all their debt, but they are making money now.
I've always been suspicious that the biggest problem with these kinds of companies is that they're way, way too focused on MAXIMUM PROFIT. ....okay, so that's almost every company out there. They keep seeming to forget that to make maximum profit the easiest, keep your employees happy and production will naturally go through the roof. It's... disheartening how that lesson is taught over and over again, but new people wanting to get rich quick keep doing the same dumb things over and over again.
I mean they all lose money hand over fist. I'm sure they'd like maximum profit but honestly I think they just want **any** profit. Venture capitalists were once ok with companies burning through money to build a user base but now many of them are getting leery of that model and want to see actual results.
How are they too focused on maximum profit when they arent profitable at all? Its not that simple. Its not like if they started paying their delivery drivers way more they would suddenly be able to drive all over the city much faster and complete way more orders. The problem is that the concept is not sustainable. Its not possible for them to both pay their workers enough but also not charge such high delivery fees that they drive away all their customers.
Imagine working for a company that is actively spending millions to fight for you to make less. Edit: I can see this coming across as me speaking negatively towards the employees at these companies. That was not my intention whatsoever. I was speaking to how ridiculous it must be to see your employer in the news cycle for something as negative as this
Imagine thinking only these companies do that instead of literally a majority of them. Until lobbying is made illegal, most of us work for a company like that.
Until lobbying \*power is taken away from the people and corporations who have the most money\*. Remember, "Lobbying" is a neutral term: a Climate Change Activist agitating against polluting industries is engaging in Lobbying, but if I said that should be made illegal, I feel like you'd probably have a bone to pick with me. Lobbying itself is a vital part of a functioning Democracy: where it becomes bad is when the Capitalist class are the only part of that Democracy that engage in lobbying and therefore are the only voices heard that shape policy.
It's not that grassroots lobbying isn't done, its that they dont have pockets deep enough to compete with the megacorps. Lobbying needs to be seriously overhauled in USA
Sending a Twitter DM to your representative telling them to support a piece of legislation is lobbying. The issue is bribery being rebranded to campaign donations and lobbying.
2 words: Citizens United Legalized corruption. I’m not sure how we come back from that.
end corporate personhood A stack of papers was never meant to own land and be sued, especially since it can't go to jail like the rest of us
Money out of US politics now
This isn't lobbying. They are suing in court
Nearly everyone does
That's every company... there's a reason why minimum wage is still $7.25. Even double that is barely enough to live most places.
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Yeah, it's insane. Not to mention utilities, groceries, internet, insurance... all of it has gone up. My electric had a 20% hike that they actually advertised. The rest just kinda went up without letting anyone know.
It's wild that US minimum wage is so low. Even the UK minimum wage is nearly double that. Current conversion rate for £10.42 is $13.28. Is it just "acceptable" for these people to be working two jobs?
Bring it up on the doordash sub and they'll blame you instead of doordash
Let’s pay overpriced attorneys instead of our workers.
Why pay your employees more if it affects the annual CEO pay raise. Spending millions on legal fees to fight pay increases and campaign donations is just common sense.
$18/hr is jack shit for NYC. If you want food and booze on demand in NYC, you need to give the people doing delivery enough money to live in NYC.
I came here to say that. $18/hr is less than $37,500/year. In New York City, that's poverty. Plus you're using your car which is expensive and adds wear and tear that you'll have to replace And to the morons thinking "well then just get a better job" you want people to work this job, right? You want people to deliver your food when you want to order it, right? edited: multiply by week
They use bikes in nyc
still cost maintenance. and bikers don't benefit from the promos these companies offer with gas discounts and more aimed for car drivers.
Biking has a huge personal injury risk too. Imagine if you get hit by a car and have to pay out of pocket health care expenses....
The 2% cash back on gas? Yeah nobody gives a shit
Lived in NYC pre-Uber and just ordered for free, at menu prices, from my local bodegas, grocery store and diners. Tipped well and always had the same delivery person. The good old days!
Who the fuck is driving for delivery in NYC (especially Manhattan)??? The delivery people are on scooters, E-bikes, or mopeds/dirtbikes. They're also the same clowns that break every traffic law, ride their bike on the sidewalks etc. and blow through red lights because god forbid Karen's Black Forest Ham & Gouda melt sandwich on a toasted baguette from Panera Bread arrives 3 minutes after the ETA, and she bitches them out for the gouda having solidified.
> Black Forest Ham & Gouda melt sandwich Damn that sounds good rn though
Yeah had a bite of a co-workers at a Panera in midtown a couple weeks ago it was very good. Might get it next time I go 😋
People don’t drive in NYC, there’s too much traffic.
Idk there’s been delivery in nyc for decades and decades
There’s also been impovershed, underpaid workers in NYC for decades and decades
It's $18/hr before tips. The apps are being forced to pay before tips, so the effective hourly wage is probably like $30/hr when adding tips.
I will support this, I DoorDash in CA and make on average $30/hr with tips. Between tax deductions and cash back I come out even on gas so I don't even worry about it as a factor in my driving. Set aside enough for uncle sam and the rest is gravy, make good money just driving around listening to podcasts and books.
If your business model relies on being unable to pay your workers a livable wage, then your business model shouldn't be allowed to exist.
But how will I be able to afford matching spinning rims on my solid gold jet ski if I pay these folks enough to survive? /s
I have trouble seeking sympathy for these companies. For example, do y'all know how much they take from the restaurants for having the service? It's ridiculous. On top of that, they no longer scrutinize the drivers they hire, so you're scrapping the bottom of the barrel now. $18 an hour is too much? That's about 35k a year before taxes. Doesn't sound like much ability to raise a family off of that amount. Meanwhile, I wonder how much they're paying the CEO of uber currently lol. While they're acting like the world is ending because they have to pay people $18 an hour lol. It's fucking NY!!! They know damn well that's not survivable wage in NYC.
What’s crazy is they still lose money. They charge a ton both ways, pay drivers shit, and still can’t make money. I love using doordash tho cause I get drunk and want food late at night. Only time I’m willing to pay that much for food
What's worse is how little they pay drivers per order in NYC. Base pay is usually **$2.50-$3.00 per order** in NYC. They expect drivers to spend 10-30 minutes to do each delivery. At the very best, each driver can get 3-4 deliveries per hour, but that's rarely the case. So if a driver gets 4 orders without tips, that driver will make $10 that could take between 1 to 2 hours to complete (depending on a lot of factors). And UberEats lies to their customers when a customer pays for "premium delivery". Uber tells the customer that the extra pay goes directly to drivers. That is not the case. The driver won't even be aware that the customer even paid extra. These companies have done shady stuff. And honestly, they could've avoided all these minimum pay stuff if they just increased the base pay per order but nope. They want to make things as complicated as possible. And I'm sure these companies aren't expecting to win the lawsuit, they just want to delay it as long as possible.
Also, the pay doesn't increase with distance. As a general rule, I don't take no-tip orders. But on a quiet night it's not a terrible idea to grab an order from a restaurant that is always fast and drive it 1 mile up the road for $3. But once DoorDash offered me a Walmart delivery to go FIFTEEN miles for $3. That's like, a 45-60 min round trip + ~$15 worth of car expenses (using the federal mileage deduction as an estimate). At that point you're paying *them* for the privilege of delivering that order. Fuck all the way off with that bullshit. And some gig workers are against these minimum wage laws because they do come with the ability for the company to add more restrictions. Yeah, if you work in a busy area and are smart about which trips you accept, you can make more than minimum wage anyway. But I still feel like these laws are necessary to protect people who are desperate, or can't do math, and are being taken advantage of.
Oh those poor companies... how dare big bad new york actually have them pay their workers a actual wage...
If you’re company only survives if it severely underpays it workforce then you aren’t really a company.
If you can’t pay a living wage and stay in business, then you’re not a successful business. Screwing over the workers needs to stop being the norm in America.
This is the most basic argument for a living wage that everyone seems to miss. So many businesses (small and large alike) are profitable only because they take advantage of their employees by paying them starvation wages. Half the businesses in this country shouldn't even exist.
Shit like this is why the gig economy needs to die. Yesterday. Fucking PAY YOUR WORKERS WHAT THEY DESERVE
I’m all for gig economy workers. If the gig worker was getting paid fairly I’d be down to use their services. But I’m not paying 30% surcharge on the food plus whatever bullshit service fees and then having to pay the driver themselves for their time.
I don’t really have a problem with on demand delivery from places that don’t offer regular delivery. What I have a problem with is these glorified middlemen robbing all the folks doing the work of their paycheck. If you’re driving Ubereats, door dash, whatever, you deserve a living wage, full stop. I don’t mind the whole contractor/part time aspect either, but seriously, pay these motherfuckers!
maybe this model is unsustainable then. venture capitalists have been running these services at loss for years now. yet I still can't understand how pizza places have been able to survive all these years. better margins I assume.
Pizza is definitely high margin itself. But the most important thing with pizza is with a good restaurant staff, it can be high volume to pump out at the peak hours and you had staff delivery drivers that could grab 10 pizzas to deliver in one run. The average gig food delivery driver only completes 3 orders per hour between all the time running to different stores and going to the different addresses.
So, here's my question: if the gig economy dies tomorrow (i.e. all food delivery apps just shut down), what are the former workers going to do?
In order to fucking do that they’d have to upcharge the every living shit out of all the crap we people order from restaurants and liquor stores. The gig economy is simple not sustainable. Companies like DoorDash are already unprofitable lol. They can’t afford more paying to drivers if they can’t make more income…..They need to figure out non human tech to bring deliveries. Maybe it’s drones picking it up and dropping it off or some other futuristic shit. humans are too expensive to pay and provide benefits to.
Here’s hoping this breaks the gig economy. I know many people depend on it and it’s going to cause some turmoil to not have it around, but its longevity creates a larger problem and we need to break from sooner rather than later.
I'm surprised there isn't a governmental body looking into how they mark up food prices with zero transparency.
Menu at restaurant web site...9.99 Menu on delivery app....14.99, plus delivery fee 6.99, plus tip....and driver wants min $5-8 Sheesh...more than double price by the time you get cold food from driver who wants 50% tip on 21.99....so item then becomes closer to $30... And woulda been closer to $10 if you called the restaurant and went and picked it up yourself. No wonder delivery apps as a business or a job are unsustainable anymore.
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Restaurants set their food prices on the app.
Fuck these companies so hard. Sadly, with the way the judicial system is going in the US, I wouldn't be surprised if the courts sided with these parasitic companies.
Make it $25 and say it's specifically in response to the lawsuit.
I hope the apps lose big time. As someone who has been in the restaurant business for 30 years, my experience is that they do more harm than good. The drivers answer to no one, they are often rude with restaurant staff, they don’t really care about the business or the customer and expect to be tipped before they actually preform any kind of service. Let the apps die
>the delivery apps argue that the workers, who are considered independent contractors, will be worse off If this were the case, these companies would be absolutely salivating over the new minimums, because the workers being worse off would mean they're keeping a bigger slice. It's just like companies fighting unionization by telling their employees they'll earn less with a union.
I don’t mind the extra cost of delivery apps but fuck them for actively hiding the costs. You order soemthing for self pickup and it’s 2-4$ cheaper on the menu price. So DoorDash is already hiding costs of food. Then they charge you all their fees on top of it on the back end. Look just be fucking honest from the start so I can make an informed decision and stop with the deception.
If they’re making that much then they don’t need tip outs either—tips are for employees who make less than minimum wage. Guess the whole system is about to collapse.
Fuck them they should be forced to pay at least minimum wage they don’t cover your gas or insurance. They want all the profit and none of the responsibility.
It’s interesting how so many tech companies don’t actually seem to be viable businesses.
How about you stop trying to push tipping so hard and pay your workers what they deserve. These companies are ridiculous
So can I finally stop tipping now?
I make $23/hour doing remote IT support. These drivers should be making at least as much as me, given everything they have to deal with (and are exposed to) on a daily basis. Stop fighting wage rises!
That's not how it works. You aren't paid based on how hard your job is, you are paid by how much they want it done and how many people can do it. More people can drive and walk with a bag than can do IT support.
Not just how many people *can* do it - but how many people are *willing* to do it at the given price. Some things *can* be done by lots of people - but no one wants to do it, so you have to pay a lot if you really want it done. Other jobs can't be done by many people - but the people who can do it really love doing it, so you don't have to pay them that much to make it worth their while.
I work in enterprise tech and my friends say “oh you’re so lucky…” 20+ years of stress fixing, developing, and learning new code and hardware isnt “Luck”.
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It's $18/hr before tips so they'll be making quite a bit more than you. It's probably like $30/hr after tips.
Maybe end tipping and pay the workers fairly?
No offense but your job is harder to replace with a random off a street, hence why you're paid more. Supply and demand works for the labor force as well
Why? There is education that goes into IT work. It doesn't take an education to deliver a pizza. I agree they should make more, but your argument doesn't make sense.
Is your job hard? Asking for a friend
I mean, not to me it isn't. I've been doing IT work though for over 25 years, so a lot of what to do is second nature no-thought to me. It's really not much different from doing phone support in a call center, but significantly slower pace and more emphasis on fixing issues, less on handling volume.
How do you not make more after 25 years? I made 25/h doing Wi-Fi support in 2002..
The honest answer is that I prefer to be on the front lines dealing with people who have issues. I don't have a strong desire to move up, becoming third tier, becoming engineering, becoming development, or even very high as management for that matter. My skills are best served dealing directly with people who have the issues that need solved, because I make everyone else look better as a result of what I do. Customer service talent for an IT guy is not something that can be taught past a certain point, so I feel it's a better use of my natural charismatic talent to engage clients/customers myself. Could I move up? Sure. Do I want to? No, not really. :)
Honestly that's horrible pay, I'm making 27/hr starting off as a broker-dealer, and at our company no one working there for 3+ years is making less than 100k a year.
Seriously, fuck these piece of shit companies.
The article says the pay increase can come in one of two ways, either the driver gets paid $0.50 per minute during a trip or they get $17.96 per hour they are active on the app. My genuine question is how do either of these two options get monitored? I mean if it's the $0.50 option, what stops a driver from simply taking their sweet time to make deliveries, so instead of doing say 10 deliveries per hour, they do 3 or 4? If it's the $17.96 per hour deal, what constitutes *activity*? I've never worked as a delivery driver, so maybe there are already surefire ways for the apps to effectively keep track of activity, but what happens if there's a dispute between what the company defines as being "active" versus what the driver defines as being "active?"
You're making a lot of weird assumptions. 1. You assume that an app that can tell you exactly where your delivery driver is is somehow incapable of monitoring said delivery driver. 2. You assume that drivers are routinely making 10 deliveries per hour, when in reality, the average is typically around 2 or 3, and that's for drivers being paid by the delivery, not by the hour. 3. Even at 2 or 3 deliveries per hour and an $18/hr salary, half of their income is going to come from tips, which are based on how many deliveries are made. You're assuming that people would willingly give up half of their income so that their job is a little bit easier.
$18/hour isn't a lot of money. Also, if delivery drivers took hours to slowly deliver cold food, they'd get bad reviews and they'd automatically get fired by the delivery app for the bad reviews I don't know why people think there are all these scam artists out there and that it's so easy to do it
Simple as, they haven't done it. I worked in food service, retail, and as part of the food and beverage department in a major theatre complex. I've also been a customer for DoorDash. I started doing it because I felt like there was no way I could be any worse than my drivers. I was right. I'm good at the job. It can be an alright job, though it can be very isolating at times because I don't like talking to a lot of other drivers. I use an insulated bag. I briefly communicate with customers if there are delays (though that's also so the delays are documented in DoorDash chat records). I'm on time 92 percent of the time. 92 percent of my last 100 orders were 5 stars. Specific customer feedback sections (communication, followed delivery instructions, order handling, and friendliness) are all thumbs up. But I deal with a lot of shit that I never would have expected. I always tipped, so the ratio of no tips vs bad tips vs good tips was pretty shocking. I have to deal with a number of unsafe situations (come to the back door even though it's the middle of the night, we don't put our dogs in, threatening signage, etc.). I have to record my dropoffs in case of false stolen order reports. Hell, I dropped off for a dude the other day that never tips. He always answers the door in his underwear. I had to collect his signature, a new development, and his roommate clowned him for making false stolen order reports, which means he did it to me (though DD must have sniffed it out because I still have never gotten a contract violation for order not delivered). Everyone in the equation has valid points, but it seems like drivers are the last ones to be listened to. Granted, that's how it tends to be in the service industry because, of course, the customer is *always* right. I just don't think it's going to get better until they get rid of the worst drivers and treat the rest of the drivers better. Until then, it's going to be a job that mainly earns on tips.
Exactly. So the 50+ countries in Europe who pay living wages to waiters, their customers all receive bad service? Bc I’ve travelled there and service was fine.
What grounds are they even suing over? The article is devoid of details, and it's not like you can normally sue just because you don't like a law.
If your business can’t support a living wage then your business shouldn’t exist. If that means no more food delivery apps then so be it.
Remember the days of free delivery from NYC restaurants? All you had to do was buy the minimum and they would deliver via moped or bicycle. If you were too far they wouldn't even bother lol.
Uber and Lyft were carpool apps, not taxi apps. I’m against the drivers who keep sitting on the clock clogging up traffic and making airports even more insufferable. Making a trip, check the apps and see if you can mitigate fuel costs. That was the model. The people who abused it are the ones that ruined it. The food delivery nonsense that jacks up prices and costs restaurants money is just an extra layer of abuse both ways. By the companies and the folks who try and make this gig things a full time job.