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LA restaurant owner reveals the crippling effect of using delivery services like Postmates


An LA restaurant is begging customers not to order from Postmates, Caviar, or DoorDash, saying that those delivery apps charge eateries 20 per cent of each order and are crippling them financially in an already difficult time.

Ronan, a restaurant on Melrose Avenue in Los Angeles, shared on Instagram on Tuesday that they spent a whopping $35,000 on app delivery fees last year.

This hit them particularly hard in 2020, when the pandemic already ravaged restaurant earnings across the US.

Highway robbery: The LA restaurant Ronan is slamming delivery service apps Postmates, Caviar, and DoorDash for their sky-high commissions 

, Daily Echoed

Pricey: Ronan spent a whopping $35,000 on app delivery fees in 2020, even as the pandemic put a dent in their business

‘We just got our year-end financials back… Not only did we lose money (a given, pandemic and all), but to add insult to injury, we spent $35,000 on delivery service fees this year,’ reads Ronan’s Instagram post. 

‘Yes, we get charged 20% of your order anytime you order from us via @postmates @caviar or @doordash,’ he went on.

There is one delivery app, though, that Ronan applauded: ChowNow.

They said that ChowNow charges restaurants a flat fee of $1,500 for two years of service with no hidden costs.

‘Please order via @chownow … for pickup or delivery whenever possible and help us get that number WAY down in 2021,’ the post concluded.

, Daily Echoed

Feud: Restaurants have complained about delivery services for years, accusing apps like Postmates and Seamless of charging too-high fees on orders

, Daily Echoed

For what? According to Eater, most delivery apps charge restaurants 15 to 30 per cent of each order, meaning they earn significantly less than customers are paying

Restaurants have complained about delivery services for years, accusing apps like Postmates and Seamless of charging too-high fees on orders.

According to Eater, most delivery apps charge restaurants 15 to 30 per cent of each order, meaning they earn significantly less than customers are paying.

Food & Wine reported in March 2020 that Brooklyn, New York restaurant Samesa has a contract with Seamless that gives the app a 25 per cent commission fee.  

Reem’s in Oakland, California pays over 20 per cent after the owner partnered with Seamless exclusively and negotiated a slightly lower rate. 

Bhuna, an Indian restaurant in Portland, Oregon, pays 27 per cent commission to Caviar, 30 per cent to Grubhub, and 30 percent to Postmates. 

In February of 2019, when a San Francisco restaurant called Gaslamp Cafe closed down, they hung a sign in their window that read: ‘Ordering online does more damage to businesses than it helps. Any profit from sale is stripped away by the fees they charge the restaurant, which leaves only enough to cover the cost of food.’

, Daily Echoed

Read it and weep: In April of 2020, Chicago Pizza Boss owner Giuseppe Badalamenti demonstrated on Facebook just how much business lose to apps like Grubhub

And in April of 2020, Chicago Pizza Boss owner Giuseppe Badalamenti demonstrated on Facebook just how much business lose to apps like Grubhub.

‘Stop believing you are supporting your community by ordering from a 3rd party delivery company,’ he wrote. ‘Out of almost $1,100 of orders, [the] restaurant you are trying to support receives not even $400. It is almost enough to pay for the food.’ 

He included an image of his restaurant’s March statement from Grubhub, which showed $1,042.63 in orders made through the app.

Then there were the fees: commission, delivery commission, processing fee, and promotions, all of which left Chicago Pizza Boss with just $375.54.



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