Montclair Family Meals charges restaurants 0% commissions and $0 in fees. We even cover the cost of credit card processing and delivery. This means that when an order is placed through our platform, 100% of the sale goes to the restaurants. Popular deliver apps may be convenient, but they are expensive for restaurants, and in many cases, expensive for your too. Let me explain...
Delivery Apps are Expensive For Both You and Restaurants
When you place an order for delivery through a 3rd party like UberEats and DoorDash, they charge a 15%-30% commission. Someone has to pay for that. Either the restaurant makes less (which is why many hate these apps), or they pass those fees along to customers, resulting in higher cost to you.
For Restaurants, Turning a Profit is Hard to Begin With
If you're not in the restaurant business, you may have never thought about the economics of the industry, so I'll cut to the chase: the restaurant industry is highly competitive with low margins.
Over the course of a given year, your average restaurant will have a net profit margin of about 6% - 10%. After paying for ingredients, rent, loan payments, staff, supplies, and utilities, the average restaurant owner pockets 6 to 10 cents out of every dollar they take in. So after all is said and done, that $10 sandwich you buy earns the owner a profit about $1!
Enter DoorDash and UberEats
Imagine you're a local Montclair restauranteur. You have a brisk business, taking in a respectable $1 Million in revenue annually. As we said above, 6% to 10% of that falls to the bottom line. Making $60,000 to $100,000 is a decent living.
Then UberEats and Doordash come to town. For the unreasonable sum of 20% to 30% of the order, they'll take and deliver your orders. The problem, of course, is that half the orders that come in are from existing customers, who formerly were ordering directly over the phone or through your website.
Assuming 50% of your orders are for take-out/delivery, that means $500,000 in orders is up for grabs. Now that these delivery companies are involved, half of your existing delivery customers begin to order though those apps. $250,000 of your revenue now flows through them. This means that if you're paying 25% in additional fees, you now have additional expense of $62,500 that you didn't previously have.
Factor in $62,500 new expenses to earn the same $1 Million in revenue, and the guy who was previously making $60,000 per year, now breaks even.
Yes, I know this is a simple example. And yes, these apps have the potential bring in more customers (but a what cost?), or that restaurants could just raise their prices to offset the fees (I don't want to pay more, do you?). But when competition is stiff, many restaurants feel like they can't simply pass along those fees without risking losing that customer to the competitor who doesn't pass that 25% along.