![]() ![]() looks to help restaurants by capping food delivery service fees at 15%Ī new proposed Los Angeles city ordinance could set a 15% food delivery service fee cap. She said she paid Grubhub 16% in October, 17% in November and 13% in December.įood L.A. Sandra Cordero, chef-owner of Gasolina Cafe, a Spanish restaurant in Woodland Hills, says she noticed a change in fees in June. “Calling them is just a pain, because anything outside of order problems, they transfer you to an account specialist and it takes forever.” “Their statements are really hard to read,” Li said. Uber Eats and Door Dash wanted to charge 30% to 35% before the pandemic, so he never signed up.Īttempting to navigate the crosscurrents of delivery app speak, guidelines and charges can be a maddening task. At one point, he says he was paying around 25% in fees to both services. Last year, he paid $21,000 to Grubhub and about $14,000 to Postmates. Forgoing that exposure is simply not an option. With no foot traffic now, Li says more than half of his business is coming through the delivery apps. Jack Li, owner of Hui Tou Xiang restaurant in San Gabriel - which does not have a fee-capping ordinance - was used to long waitlists and a packed dining room prepandemic, with diners crowding in for blintz-shaped pork dumplings and house-made kimchi. In January, Assemblywoman Lorena Gonzalez (D-San Diego) introduced AB 286, which would create a statewide fee cap of 15% of the menu-listed price of an online order. city and county ordinances remain in place until 90 days after indoor dining can resume at full capacity, but some restaurateurs say the 20% is still too much and that if you’re in a city without its own fee cap, services can charge more. In other words, that extra 5% cannot be used by the app company as the price of doing business for the delivery app’s services.”īoth the L.A. “The restaurant has to agree with the delivery app company on that type of arrangement. “The additional 5% can only be charged for non-menu item-related services such as promotions,” Arranaga wrote in an email. City Councilman Mitch O’Farrell, who introduced the city ordinance last year, specified the cap further. Tony Arranaga, communications director for L.A. ![]() It also is unlawful to charge more than 5% for marketing (or other nondelivery fees). In the city of Los Angeles and in unincorporated areas of Los Angeles County, it is unlawful for third-party food delivery services to charge a restaurant more than a 15% commission fee for an online order during the local public health emergency related to COVID-19. But the tally of the charges has been a shock to many, including Caitlin. 12.įor many restaurants, these food delivery companies provide a service they cannot offer on their own. … 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,” Caitlin wrote on Jan. ![]() “We just got our year-end financials back. So the Cutlers did what some in need of a good vent did: They posted their frustrations on Instagram. (In December, delivery apps accounted for 74% of Ronan’s business.) The couple have always budgeted for rent, but they could not have anticipated the devastating effects of a pandemic: a precipitous drop in sales and the skyrocketing expenses associated with getting their food to takeout customers. It’s also what they spent on food delivery service fees in 2020. Or a new Mustang with a high-performance package.įor Caitlin and Daniel Cutler, that’s one-third of a year’s rent at Ronan, their Melrose Avenue Italian restaurant. What can you buy with $35,000? A house in some parts of the country. ![]()
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