Local restaurants have beef with delivery fees | KOB 4

Local restaurants have beef with delivery fees

Tommy Lopez
Updated: May 15, 2020 10:13 PM
Created: May 15, 2020 09:12 PM

ALBUQUERQUE, N.M.- Locally-owned restaurants have concerns over how much some delivery companies are charging them to use their service.

In some cases, restaurants have benefited from the help from companies like Grubhub, DoorDash and Uber Eats because they don’t have their own drivers on staff. However, the convenience can be costly.


Many restaurant owners told KOB 4 that they typically pay fees to the delivery company that total 15 to 30% of an order. Some companies have cut or deferred fees, but many restaurants say Grubhub has the highest fees, which can reach 35%.

KOB 4 spoke to Jason Zeng, the owner of Fan Tang, which is in Albuquerque on Central Avenue. It’s kept all its staff since the restrictions began. Zeng feels lucky to be doing so well, but he would prefer customers to avoid delivery.

“Order pickup from your local business by calling in or going to their website,” he said. “We’ll bring it out to you. It’s easy.”

The number of delivery orders have gone through the roof.

“Right now, I’d say our Grubhub orders have tripled, but that’s not very beneficial to me since, at a 35% discount, I’m not making anything,” Zeng said. “I’m breaking even at best, and if something goes wrong with an order or one of their drivers is late, we get charged for that.”

He feels like he still has to use them to compete in today’s climate.

“I find that if you don’t do that right now, you can’t survive. It’s just a very weird dynamic right now,” he said.

Zeng used Grubhub before the COVID-19 conditions kicked in, but that was when he was able to also have dine-in business. Plus, he feels that back then he was benefiting from the advertising that comes with using the delivery service.

Customers can also get Fan Tang delivered through its own website. It uses a local company, Selflane, which has its own drivers and allows the restaurant to keep more of the profits.

Grubhub says the fees it charges is how it has to operate to make money.

A company spokesperson said in a statement in part, "We know these are tough times for independent restaurants, and we’re happy to work with restaurant partners to help them manage costs and grow their business.”

"... It costs money to coordinate drivers, perform driver background checks, and create/update delivery technology.”

Grubhub also says it's started a fund that's donating an average of more than a million dollars a month to charity groups that support restaurants and drivers.

Grubhub drivers say they're busy and the money is pretty good.

“It can be one order after another after another all while I’m driving to the next delivery,” driver Coyote Beale said.

He feels like Grubhub is not contributing as much to what he earns as he thought the company would.

“It’s all from the generosity of the people giving me tips out of pocket,” Beale said.

He describes his experience as a mixed bag.

Restaurants will not be able to have customers eating inside until at least early June, per the governor’s order.

Copyright 2020 - KOB-TV LLC, A Hubbard Broadcasting Company

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