To delivery or not to delivery? That question, asked frequently nowadays, just got more complicated in the wake of the World Health Organizing (WHO) declaring COVID-19 a pandemic.
Food tech expert and Modernist Cuisine’s former technical director Scott Heimendinger left a tweet yesterday that not only highlighted the issue but also underscores how complex potential solutions are:
Restaurants operate on absurdly thin margins during the best of times. Overhead costs like labor, inventory, rent, equipment, card processing fees, and a litany of other deductions all eat away at these thin margins. Now businesses are seeing sales nosedive as more and more consumers opt to stay home instead of going out to eat. For example, in the Seattle area, where the first U.S. deaths from coronavirus occurred, some restaurant sales have dropped as much as 40 percent. As the number of cases throughout the country rises, there could be a ripple effect, particularly in crowded urban areas like NYC, Boston, San Francisco, and other cities.
You’d think delivery would be the answer to this problem of declining foot traffic. After all, you order delivery from Joe’s Pizza or wherever, and you manage to feed your family without leaving the house while putting money in the restaurant’s coffers, right?
Well, it’s a little more complicated than that. Third-party delivery services like DoorDash, Grubhub, and others are, to borrow, Heimendinger’s word, “notorious” for gutting restaurants with hefty commission fees which are sometimes as high as 30 percent of each transaction. However, most small and independent restaurants still use these services for delivery because they lack the resources to manage the entire delivery process (drivers, marketing, technical logistics) themselves. So more customers staying home because of COVID-19 could translate to more delivery orders, but that won’t necessarily improve restaurants’ bottom lines.
Third-party delivery services are also known for ethically questionable policies around how they treat the folks shuttling the food from the restaurant to the consumer, from sketchy tipping policies to fighting legislation that would reclassify these gig workers as employees and give them access to health benefits and paid sick leave.
Heimendinger addressed this in another tweet, asking followers, “Are you aware of any delivery services stepping up to change their fee structure to help restaurants retain more of their revenue during the #COVID19 crisis?”
And in fact, some of these services have made moves in that direction. All of the major services have or are readying contactless delivery features, which limit the human contact between drivers and customers. Uber, DoorDash, and Postmates have been in talks to set up a fund that would compensate drivers affected by COVID-19. Independently, Postmates has also launched two different funds: one to cover medical costs for drivers affected by COVID-19 and the other to temporarily waive commission fees for new merchant partners operating small restaurants.
There is no guarantee that any of these measures will be able to adequately protect workers. At the same time, I agree with Heimendinger that local restaurants need consumers’ support at a time when foot traffic will continue declining as social distancing becomes more widespread.
I don’t believe there are any easy answers to this issue. If we double-down on delivery orders, we help pay workers’ wages, but we’re also only reinforcing an unsustainable business model that is decimating local restaurants. If we forgo delivery as well as dining in, we’re also helping decimate local restaurants.
The onus is on the delivery companies. DoorDash, Grubhub, and others need to be waiving or at least reducing restaurant commission fees right now. More of them need to help cover medical expenses for checkups and provide paid sick leave so that drivers who aren’t feeling well and potentially infected aren’t out making the rounds and possibly infecting restaurant workers and customers. At least some delivery fees for customers should be waived, as those premiums add up quickly and make restaurant meal delivery out of reach for lower-income families. Finally, delivery services need to accelerate the availability these changes now if they want to avoid playing the villain yet again.
