Grubhub: Speedy Delivery AND Price-Gouging Restaurants Into Financial Ruin

Delivery apps are bleeding restaurants dry.
Grubhub: Speedy Delivery AND Price-Gouging Restaurants Into Financial Ruin

Over the weekend, a Chicago-area restaurant became the poster child for how Grubhub screws restaurants that had the gall to work with them.

That's the monthly invoice the restaurant got from Grubhub for their delivery services. Through orders placed on Grubhub in March, the restaurant made $1042.63 spread over 42 deliveries and four pick-ups. After Grubhub applied their standard fees, the restaurant kept only $376.54. Grubhub gave themselves a generous tip of 36% that totaled a Satanically appropriate $666 cut of a small business' profits. That's even after a one-time promotional credit Grubhub applied to the account that let the restaurant keep $231, in their sad attempt at helping them out during the pandemic.

The restaurant got screwed, and so does pretty much every other restaurant that partners with Grubhub. Their mission statement must include a promise to partners to be the fastest, most efficient way to be brought to the brink of financial ruin by a food delivery app.

Grubhub cuts deals with restaurants that typically don't hire their own delivery people. For this, they charge anywhere between 15% to so much that you, as a restaurant owner, are probably left wondering if they're going to then break your legs and take your pizza oven.

Now consider that a lot of restaurants feel the pressure to be on as many food delivery apps as possible (that all have their own fees, some of which are just as bad as Grubhub's), so that they don't miss out on potential customers who don't want to have seven food delivery apps on their phones. The apps, owned by giant companies, have leverage over small local restaurants since they've opened up the option for delivery to tons of places that don't have the resources to do so. It allows them to charge out the ass because they can.

Large metropolitan cities filled with restaurants like New York, Los Angeles, San Francisco, and Boston have been trying to cap meal delivery app cuts to 10 to 15% range. Chicago is trying to cap it at 5% -- and for good reason. All this amounts to the "do for exposure" mantra rich dicks on Twitter shout at poor people trying to make a living to get them to work for next to nothing. Sure, you're selling more meatball subs than ever before, but you have to sleep in your commercial oven next to a bubbling veal parmesan. That's on you for thinking you can afford to own a restaurant and live in a home without getting extorted by someone, you naive fool.

Luis can be found on Twitter and Facebook. Catch him on the "In Broad Daylight" podcast with Cracked alums Adam Tod Brown and Ian Fortey! Check out his regular contributions to Macaulay Culkin's and his "Meditation Minute" segments on the Bunny Ears podcast. Listen to the first episode on YouTube!

Top Image: Grubhub/Twitter

Scroll down for the next article
Forgot Password?