Grubhub on Wednesday launched Grubhub Direct, a platform independent restaurants can use to build their own online storefronts and process orders free of commission. According to a press release from Grubhub, the platform also gives restaurants control of their customer data.
The launch comes after more than a year of heavy criticism of delivery services over the commission fees they charge restaurants. Though Grubhub and others have done this for years, the issue became a lot more hot-button in 2020 when the pandemic shut dining rooms down and forced businesses to rely on third-party delivery services. Many cities across the U.S. introduced mandatory fee caps to keep commission fees in check.
Seemingly in response, third-party delivery services have, one after the other, launched various means of addressing the restaurant commission fee issue. Uber Eats was first, in July of last year. DoorDash followed, with a “tiered commission” setup.
Grubhub’s particular version is, the company indicated today, particularly geared towards independent restaurants — a group that’s historically paid the most in commission fees. Grubhub direct offers these restaurants the option to build a branded website, create loyalty programs and promotions, the ability to process and manage orders, and access customer names, email addresses, and order history.
Grubhub says there is no marketing commission on Grubhub Direct orders, and that it is waiving the one-time setup fee (normally $99) on the product until May 2022.
Per the fine print, restaurants will pay Grubhub a $49/month non-refundable hosting fee for their website for each location. Restaurants must use a URL provided by Grubhub, and of course, since it’s a Grubhub platform, all the data still lives in the hands of the delivery service. Like any other third-party service, Grubhub will still charge a commission fee if the restaurant uses a Grubhub driver to handle the last mile.
Direct also seems to be Grubhub’s way of competing with software platforms like those from Ontray, Lunchbox, and others. These services also let restaurants build their own digital storefronts and manage orders, and many already integrate with third-party delivery services for the last mile of delivery.
Grubhub, meanwhile, may be undergoing some big changes in the near future. Just Eat Takeaway.com, a Dutch delivery service that acquired Grubhub for $7 billion in 2020, recently published its prospectus for the merger. As it noted, Grubhub shareholders will meet to vote on the offer in June.
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