As of yesterday, Uber Eats’ standard $4.99 delivery fee is no more. In its place is a pricing tool that calculates an order’s delivery fee based on the distance between customer and restaurant.
CNET reports that Uber Eats has been analyzing what deters some people from ordering via the third-party delivery service. “What became obvious was that we needed to change something about our core fee feature,” Uber Eats product manager Ben Dreier told CNET.
And a big part of that fee is having to pay $4.99 regardless of whether you ordered a cup of soup or eight burritos. Plus, it’s hard to justify paying nearly $5 for food delivery if it takes less than 10 minutes to walk to the restaurant. But then again, I’m a fairly active person who works from home, so I don’t have any excuses. Others have legitimate reasons to order nearby delivery. A close friend of mine used to tend bar in Brooklyn and almost every night would get tacos delivered from across the street because he couldn’t leave the bar premises for dinner. Working parents, or parents with multiple kids, are other use cases that come to mind.
Perhaps most importantly, there are individuals for whom food delivery isn’t a luxury or even a “nice to have.” For those with disabilities affecting their mobility, or those with chronic illness, walking 5 to 10 minutes to pick up dinner is a physically taxing event at best, and more often than not impossible.
It’s estimated that ordering close by will range from $2 to $3; longer distances will fall in the $6 to $8 range. The changes will also allow Uber Eats customers to set a “max booking fee,” which lets users set the limit on what they’d spend on delivery. The app then filters out any restaurant whose delivery fee wouldn’t fall within that range.
This new system is now in place all U.S. cities where Uber Eats operates.
Grubhub already offers a sliding scale delivery fee, only they leave that number up to the restaurants themselves. Restaurants also decide whether to set a minimum amount a customer must spend in order to have the food delivered. By contrast, Uber Eats has always allowed customers to order as much or as little as they like, which won’t change with the new pricing system.
While this fee structure will most likely incentivize customers to order more delivery from places close to home, the higher fees for longer distances could also be a business boost for Uber Eats, particularly in rural and suburban areas, where there are at least a few miles between houses and restaurants. Uber’s already stated it plans to IPO next year, and this potentially large new revenue stream is likely part of that plan. That is, unless people balk at the high cost of getting McNuggets delivered to their suburban door.
Elsewhere in Uberworld, yesterday — the same day Uber Eats announced its new price structure — the New York City Council voted to cap ride-sharing services. That means cracking down on the number of vehicles that ride-share services can have on the road. The Council approved halting new licenses for ride-sharing services for one year, so the city can “study the booming industry.” If the new regulations prove popular, other cities could adopt similar measures.
Uber Eats “drivers,” however, don’t necessarily need a car to make deliveries. Uber even claims that “most deliveries are door-to-door.” In other words, people are walking (or biking or whatever) to the restaurant to pick up the order, then walking to the customer’s door.
Even in places where walking is out of the question, there are food delivery options for Uber Eats that don’t necessarily need cars. Earlier this year, Uber acquired electric-bike startup Jump. You can’t take a bike on the freeway, but there are plenty of markets in smaller cities and up-and-coming urban areas where a speedy electric bike could easily increase food deliveries. Solutions like that may be what protects Uber Eats from the shakeout that will happen because of these new ride-sharing regulations, and make the efforts to adjust the pricing model worthwhile.
It’s ridiculous, they want to charge a $19 fee to have four cheese burgers delivered from McDonald’s only ten blocks away. Absolutely Absurd.
You know what’s ridiculous? I get out of the house to drive 8 minutes to McDonald’s for them “cheeseburgers” something the person does NOT want to do or can’t do but I’m willing to do it for $4.70 get to McDonald’s wait for the food get in the car drive opposite of my house 5 to 10 minutes to give the meal and BAM NO TIP. I JUST DID ALL THAT FOR THE 4.74 IN WHICH I COULD OF DEFF. SAVED MY GAS. SMH
Try the trip I had last night. $2.21 no tip! Are you kidding me? This sliding scale is killing me!!
I tried Uber Eats after Grub Hub. The food is cold and/or soggy. I’m better off picking places that have their own free delivery. So now Uber Eats joins my list with Grub Hub…
I checked, I could literally take an Uber, there and back, cheaper than the fee. I’m dumping the service, get food via DoorDash, and using lyft. They never reply. Never give a shit. Next Token vote, I’m voting against.
This is structured in a way that is detrimental to the driver. The pay for drivers has plummeted. We are rarely if ever tipped. Every other platform pays more. Uber Eats will not be in business long at this rate. All the drivers are complaining and switching to apps like DoorDash and Postmates.
They increased their cut of the drivers income from 25% to 35%. They tout “efficiency ” as how they pay drivers but send you on routes not driveable — wring way on 1 way roads, etc), estimate the wait and drive times and miles–always shortchanging the drivers, allow orders from 10-30″ away from delivery site — sure, you’re very (not!) likely to get a gratuity much less even gratitude from the recipient if limp french fries and burgers driven 30″ even when kept in the hot bag, pickup in high rent districts but sent to places one is more likely to get murdered than receive any tip.
Delivery is a CONVENIENCE and SERVICE industry. The recipient should plan on tipping the drivers who get paid 97c to pickup whether 1 or several orders, 65c to drop off, nothing for getting to the restaurant, car costs, phone /data costs, fuel costs, and less than IRS allows for mileage because company takes 35% of everything listed as ‘driver earnings’ except tips. The restaurant upcharged you for delivery, the delivery company charged the restaurant and the customer and the driver, hell– the phone, gas stations and insurance and car repairs all get paid whether or not the driver makes any profit—or actually ends up paying to deliver your food… not one takes a risk except the driver. And the patron got the goods they desired from the place they desired at the time they desired without any effort whatsoever–including not walking down the 3-4 flights of stairs so drivers don’t have to climb them again at no pay and then no tip.
Those who don’t want to pay delivery fee you walk or drive to restaurant and spend gas and mileage. It’s your choice. No one force you to use this delivery.
What a rip off! These bogus services are for the rich and lazy…or the rich and fortunate, however you look at it.
And they all are hitting the restaurant with a 30% fee as well, a losing proposition considering normal margin is usually less than half of that. Not a sustainable model for small business restaurants at all.
We do everything we can to avoid paying fees. We only use restaurants with free (or small) delivery fees or wait for a coupon from PostMates, UberEats, GrubHub, etc.
I swear that I never make these “good old days” statements, but we did get along for many decades with delivery from Chinese or Pizza only.