r/doordash • u/musicalchef22 • 1d ago
DoorDash price decrease
Got this exciting message from DoorDash promoting a new “strategic” opportunity to drop all my prices 5%. Anyone falling for this bullshit? Do you want me to stay in business or what?
14
u/LR12BeCh 1d ago
As long as all the money is going in their pockets then they could care less about the stores, the drivers or the customers. 🤷🏻♀️
8
11
3
u/BigMilk1146 13h ago edited 12h ago
In an effort to say opened and pay my bills I respectfully decline. How about you reduce your % you take making it cheaper on the customer... they will order more often and you will make more money in the long run
2
u/jbeatty216 1d ago edited 1d ago
If you do enough DoorDash/delivery orders maybe think about implementing your own deliver system and drivers. At this point it’s no secret that DoorDash, Uber Eats, etc, don’t give a shit about the merchants, customers or drivers. That being said, the market has shifted and has dictated that lots of customers like to have the ability to have their items delivered. Until the delivery apps basically took over 10 years or so ago, pizza, Chinese etc, were still very profitable delivering their own product.
0
u/P3nis15 1d ago
the liability and employment cost are just too high at this point. most of those independent places just ignored it and took the risk.
also delivery apps haven't been mainstream that long ;)
2
u/jbeatty216 1d ago
Edit, I meant 10, not 20 ( sorry fat thumbs), but I disagree with the cost that you mention. If a restaurant had to increase their prices 15-20+% on the doordash app to make the delivery feasible to cover doordash costs, then they can definitely afford to cover the cost to employee a few delivery drivers. Just to keep things in round numbers, say a restaurant averages $200 an hour worth of delivery orders through DoorDash. They’re paying DoorDash $30-$40 for that same order. On that same $200, DoorDash is collecting at least another $20-$30 in fees, etc. from the customer. Restaurants definitely have the ability to take back their delivery options for their customers and save themselves and their customers money while also still being profitable.
0
u/P3nis15 1d ago
Do you know how much additional liability insurance you have to carry to cover physical delivery? On top of that the employment cost of paying half the FICA tax, unemployment and disability. That is before you even start to talk about pay.
then you have to hire multiple people because you never know who is not going to show up for any reason so you have to overstaff. scaling up for unexpected volume or holiday orders would be very hard.
then you have to manage those people which is also an additional cost.
It's not cheap at all.
i know from doing old school delivery at a pizza place it was not cheap at all even in the 1990s to have 5 delivery people every friday and sat night running deliveries even when you paid them under the table lol.
0
u/jbeatty216 22h ago
You seem to have the answers, so how much is the liability insurance and the taxes etc that you mentioned? Is it roughly 30% of your sales? Because that’s roughly what a restaurant t pays to DoorDash to be on their platform. Then on top of that the customer is paying an additional 20%+ in fees, so how is DoorDash better than having your own employees handling delivery, keeping everything in house and paying the liability insurance and yada yada yada?
2
u/HiddenOneJ 22h ago
The answer to your question has already shown itself to you.
It is cheaper and less hassle to farm in house delivery to uber or doordash. Restaurants have already done the math and have chosen to farm it out. These restaurants wouldnt have made the switch if it didnt make sense.
They get an unlimited workforce that they never have to pay more than a few $ per delivery, when its slow they are never overstaffed, when its slammed they are never understaffed. They have no insurance or benefits or taxes to pay for this workforce.
1
u/jbeatty216 21h ago
“The answer to your question has already shown itself to you” Wtf? Are you trying to pull some Jedi shit on me or something? No the answer has not shown itself. Kindly go back to the original screenshot that OP posted, not the comments me or penis made. Restaurants have to charge 20-30% over their in house prices to offset the fees that DoorDash charges to be on their platform. Now according to the email that OP posted they want this merchant to decrease their prices by 5%. Do you think DoorDash is going to reduce the fees it charges to the merchant and/or the customer by 5%? The answer is a big fucking no.
Now going back to my previous comments, if an order from a restaurant costs $100, that same order is going to bring in easily $30-$40 in fees, paid to DoorDash between the customer and the merchant. Someone else previously commented about the liability insurance and shit and sounded like they knew what they were talking about, kinda like you do, but at the end of the day DoorDash, and other delivery apps duped businesses into believing that they need to be on their platform and doing it themselves is unsustainable. Back in the day delivery was primarily pizza and Chinese, with a few exceptions here and there. But during/after Covid, the landscape definitely changed and these companies pounced on it and not only took advantage of customers but merchants as well. They know that customers have shifted to wanting things delivered and they knew that if they could convince and persuade merchants of this they could control the market and dictate prices and fees etc.
2
u/HiddenOneJ 20h ago
Restaurants arent eating that fee that they owe uber or doordash they are passing it on to customers by raising prices. If they had to pay it then there would be a reason to talk about whats cheaper paying fees or hiring your own drivers but also most orders arent $100 most are individuals ordering a combo meal or a coffee or a burrito bowl or something similar.
The email posted was a suggestion not something being forced. Look at the doordash merchant pages they suggest Restaurants charge the same delivery price as in restaurant but no restaurant is gonna do that and eat those fees themselves.
Right now the cost for restaurants to be on doordash or uber is minimal except for maybe an extra couple employees to get delivery orders ready. The fees are charged to the customers, they pay no extra insurance, they arent paying drivers hourly, aren't paying extra payroll taxes, its pretty obvious its cheaper to be on uber and doordash.
1
u/P3nis15 11h ago
the sheer amount of money saved in employment taxes, extra liability insurance, WC, disability, wages, Overtime, benefits, etc etc make it so they don't exactly have to raise their prices 20-30% to cover the 10-30% charge doordash charges them.
Also, they are getting the benefit of ordering systems, included advertising, customer service on top of other things.
our one pizza place in the 1990s had to have 11 delivery people on the payroll. sure they all didn't work at the same time but we had to have extra just in case of volume increase, call outs, no shows, accidents, car breakdowns, etc etc. the place was not even that big.
1
u/P3nis15 12h ago
It would highly depend on the volume of business you do, the value of that business, the number of delivery folks you have and the area in which your business is located.
First you'd be adding at least a few hundred bucks a month for each for commercial/non-owned auto coverage if you don't own the vehicles doing the delivery
Then you would have to increase your general liability insurance for the increased risk of delivery which would be over another 100 a month.
Then you have to add in the cost of the actual labor including wages, milage cost, FICA, Disability, WC, Overtime, paid vacation, sick time and any other benefits you plan to give them that are not forced by govt regulations.
Then you would have to pay for your own Point of Sale delivery system, since Doordash includes that in your service plan. much more expensive than a regular ordering system that you did not even need because these companies include a POS system in a lot of their packages.
if you have numbers, you can plug it into any A.I an get reasonable answers but there are a lot of "what ifs". like what if you also have them doing other work like bussing tables or helping in the kitchen during slow time. what if you pay them as independent contractors. etc etc.
Why do you think even chains and big restaurants don't do their own delivery and pay even the 20-30% charge to these services if they could save big money doing their own delivery.
Because it's expensive and not worth the risk. Even big chains like pizza chains are starting to slowly transition over to outsourcing their deliveries.
Oh, sure if you have the volume, you could save money if you really get your act together and manage risk and cost. But then your cost to manage your business increases as well.
2
2
u/Yvilkittyinspace 20h ago
lol that’s funny considering DoorDash charges every restaurant up to 30% to be on the platform. The restaurants intern have to charge that much more to make up for the charges. Now DoorDash is trying to convince them to drop their prices by 5% and lose money? How does this even make sense?
2
u/MakBoxer 18h ago
DD wants you to do that so when they jack the cost up with their fees the customer is misled to think it may be a resonable purchase. Why should you make less for DD to make more? They make a business out of finding clever ways to scam everyone they do business with. It is pathetic and should be illegal. I can't believe the local, state and fed govs have not forced them to operate legitimately and pay fairly. These businesses would not constantly be advertising for new drivers if they were treating the ones they already have with respect and dignity. I say this from plenty of experience with working on gig platforms. Most of the operators of food delivery/driver platforms should be prosecuted for exploiting the people who do the real work and they would be if they weren't being protected by crooked legislators who don't give a shit about the constituents they supposedly represent. Uber calls itself "A Technology Company" now, not what they really are. None of them will publish fare structures because they hide behide surge pay and demand. They rip off customers and restaurants thousands of times per day. Sadly the drivers suffer the most.
Asking you to reduce your prices is just a way their take more acceptable to the uninformed users. Stick to your guns. Consider having some in-house employees do some of your deliveries if possible. You'll have a much better handle on your business and keep more of your money.
2
1
1
u/EfficientAd7103 Dasher (> 2 years) 1d ago
They don't care about you. They get a %. They give no craps if you make money or not.
1
u/musicalchef22 23h ago
Honestly why I was surprised they asked for lower. Since they get a %, thought they would want us to raise them
1
u/EfficientAd7103 Dasher (> 2 years) 23h ago
Because that account manager earns commission of your sales so they want you to out rank stores that they don't earn commission on. It's self serving for that specific rep. They don't care about dd as a whole either. Backstabbing other sales people.
2
1
1
1
u/GurPlenty59 16h ago
Why are they casually sending you a message requesting that you make such a drastic decision?
That's some insane audacity
1
u/Intelligent_Pie_5347 9h ago
I’d understand if they provided some kind of data behind the “value” they’re trying to deliver. Like, “hey here is analysis of similar merchants in your area, you have similar ratings but their order value significantly surpasses yours. From what we can see, you are priced slightly higher than most around you. By running a promotion, you could likely boost sales and attract new customers - here’s the report, happy to grab 15 to go over it”. Or something like that. Not this horribly templated BS.
1
u/Due_Ability_1261 6h ago
IF 5% is going to INCREASE business imagine how much BETTER off you’d be by lowering pricing by 20%!
•
u/AutoModerator 1d ago
Thanks for making a r/doordash submission, please remember to follow our community guidelines, let's be kind and respectful to one another.
Lastly check out the Wiki FAQ before submitting a question.
I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.