Some restaurants in Durham Region are starting to think twice about whether to continue with delivery app services or set them aside.
They say food delivery services were helpful during the pandemic, but it might be time to move on from them.
Matt Cardwell, owner-operator of the Royal Oak pubs in Whitby, who primarily used SkipTheDishes, says dealing with delivery services is alright the majority of the time, but it can cause problems.
“There were some times when they (the delivery services) would dispute whether the issue was caused by the restaurant’s fault or the delivery,” he says.
He says typically if it was a time delay by the driver, the delivery service would cover it by activating credit or partial credit, but anything else would lead to confrontation.
In pre-pandemic times, delivery services charged restaurants a commission rate of around 10 per cent but with the rise in demand over the past two years, they began charging restaurants around 20 to 30 per cent, according to multiple food delivery websites.
This left significant holes in already tight financial budgets during the pandemic.
Jason Goodis, owner-operator of Smash Kitchen & Bar in Whitby, says delivery services are helpful but there’s a cost associated with them.
“They make our lives easier because everything is online and is in one place for us but, at the same time, you’re paying 20 per cent commission,” he says.
“From a customer standpoint, it makes everything simple but from a business standpoint it’s a little more economically challenging.”
Cardwell agrees there’s almost no room for profit when using delivery services because of those high commissions.
“I think once COVID starts to settle down into 2022-2023, I believe you’ll see local restaurants opt out of their service, including myself, because the margin of which they take of a normal order it’s just simply not attainable,” he says.
Despite those downsides, the demand for delivery services did bring employment opportunities to many people across various jobs, including chefs, restaurant administrators, servers, and delivery staff.
Restaurants and delivery services were forced to hire more people to cope with the demands.
According to a 2022 study done by Agri-food Analytics Lab at Dalhousie University in Nova Scotia, 4.2 million more Canadians are ordering food online at least once a week now than before the pandemic.
Pre-pandemic, almost 30 per cent of Canadians ordered food online at least once a week. Since then, the number has increased to just over 45 per cent, with about half of Canadian saying they intend to continue ordering online at least once a week once the pandemic is over.
With in-person dining back at full capacity, Cardwell plans to slowly remove delivery app because there’s no room for profit. However, Goodis plans to keep them as he believes they will still remain popular.