Action, Finally, Against Delivery Apps

May 11, 2020 Admin 0 Comments

From the Editor: Everything you missed in food news last week

This post originally appeared on May 9, 2020 in Amanda Kludt’s newsletter “From the Editor,” a roundup of the most vital news and stories in the food world each week. Read the archives and subscribe now.

On Thursday night, the mayor of Jersey City signed an executive order, effective immediately, capping all commissions to third-party delivery apps like Grubhub/Seamless, Uber Eats, DoorDash, and their ilk to 10 percent. Similar emergency measures passed in D.C., Seattle, and San Francisco over the last four weeks.

Boston, Chicago, and New York are considering similar caps.

People in the restaurant world are familiar with how insidious these services can be. The problem isn’t just that they are taking a hard-to-justify-especially-now 30 percent commission. Some owners are actually understanding of the costs.

It’s that many of these services engage in predatory tactics in order to charge more for “marketing” and “partner” with restaurants without their consent. Even during the pandemic, Grubhub launched a program to “help” ailing restaurants in which it passed on discounts to customers at the restaurateurs’ expense. It also touted its plan to defer fees instead of lifting them as a huge boon to business.

But it took this pandemic for legislatures and the general public to better understand how the apps are cutting into the meager revenues of small-restaurant owners.

The companies’ resistance to the new legislation is predictably manipulative. In comments to Eater SF, a spokesperson implied the cap would also hurt “struggling delivery workers” as well as “seniors and families at their most vulnerable time.” The company told customers a cap would “immediately cripple delivery orders,” and cost consumers more (as if passing off the true cost of having food brought to your door is a bad thing).

While the D.C. cap was under consideration, DoorDash, Grubhub, Postmates, and Uber Eats sent a joint letter to a member of the City Council, noting that “Delivery people—who are currently relying on on-demand work opportunities to earn an income—would have fewer work opportunities and lower earnings.” The notion that a lower commission would take away marketing dollars for the platforms and thus decrease demand and delivery opportunities is specious at best.

Demand is up and will continue to be. In Q1 alone, Grubhub reported record revenues of $363 million, up 12 percent from the same time last year. Orders nationwide in April were up 20 percent with many markets up 100 percent.

Third-party delivery as a concept is not evil. Consumers just need to understand and then pay the true cost of it.

Luckily, Amazon is getting into the game, so this will all end fine for everyone.

On Eater

Gary He

— More cities and states are beginning to allow restaurants to reopen. We have an ever-updated tracker here, but some highlights include Nevada this Sunday, Virginia probably next week, and Nashville on Monday. South Carolina patios are already open. Vegas casinos hope to reopen by the end of the month. And in Texas, where restaurants are open at 25 percent capacity and patios are fully open, a worker had to sue to get permission to wear a mask at restaurant chain Hillstone.

— Restaurateurs and other small-business owners continue to say that the Paycheck Protection Program loans are not usable. But Corey Lee of Benu and In Situ in San Francisco has been able to put his to use on his new takeout-only spot, San Ho Won.

— Many, many different groups have released frameworks for reopening, including Nevada, a California restaurant lobbying group, and the CDC (though the White House rejected its proposal). New Orleans and Austin, notably, are going the extra mile to require contact tracing.

— Meanwhile, cities that are still shut down had trouble keeping the crowds away during a sunny Cinco de Mayo.

— In the wild world of to-go cocktails, Washington and Pennsylvania are finally loosening up rules. New Orleans is, weirdly, not budging. And I’m with Jaya that the lax rules in NYC need to stick around for the foreseeable future.

— Permanently closed: Muddy Waters in the Twin Cities; Daddy-O and Gem Spa in New York; Il Corvo in Seattle; Souplantation in Southern California; and the Table at Season to Taste in Boston.

— Workers from 50 fast-food restaurants across Florida organized a day-long strike in protest of low wages and lack of safety measures.

— In the world of high-end restaurant awards, the James Beard Foundation announced its finalists for chef and media awards. The winners for the latter will be announced at the end of the month, and the chefs have to wait until... September. Michelin will delay publishing its next guides, but has yet to cancel any fall events and has pledged to continue its online reviews program. And World’s 50 Best is pivoting to a recovery summit.

Photo-illustration: Eater

— One nice thing coming out of this pandemic: a rise in the culinary barter economy.

— Antoni from Queer Eye has a new quarantine cooking show on Netflix.

— Why Tater Tots are the perfect food right now.

— And this week in high-end pivots, New York’s red-sauce celeb magnet Carbone launched a Hamptons pickup service to the tune of $2000 per month.

— Alternately, New Yorkers could just order some delicious cakes.

— A restaurant group in San Francisco launched an incubator program for its furloughed chefs in its kitchen and restaurant spaces.

This week on the podcast

Daniel and I talk to Matthew Wadiak, the co-founder of Blue Apron and CEO of Cooks Venture, about how the pandemic is exposing the cracks in the industrial meat system. Then we get into the biggest stories of the week.

Off Eater

• How offices will change post-pandemic. [ReCode]
• Howard Schultz’s call for a Marshall Plan for small businesses. [Medium]
• Turns out people are cooking a lot of fish right now. [NYT]
• Temple Grandin on the fragility of the industrial meat supply. [Forbes]
• Martha Stewart’s gardener on what it’s like to quarantine with her. [T&C]
• How Alison Roman would love to actually turn this popularity into dollars (but without selling out). [The New Consumer]