Delivery service DoorDash, which is under fire around the country for its pricing, said in a press release on Tuesday (April 27) that it will offer new “Partnership Plans” for restaurants, including a 15 percent commission option.
DoorDash Basic, with a charge of 15 percent, “is the most cost-effective way for restaurants to offer delivery and pickup” to their customers, the company said, noting that “the plan shifts a higher portion of the delivery cost to the customer and adjusts the delivery area.”
The company will also offer DoorDash Plus service at 25 percent, which includes the company’s “most loyal customers as part of DashPass, an expanded delivery area and reduced delivery fees for customers.”
The third tier is DoorDash Premier at 30 percent, with “the lowest customer fees and the largest delivery area, in addition to the benefits of DashPash,” a customer loyalty program.
DoorDash had fought commission caps — some of them set at 15 percent — that were slapped on the delivery industry by at least 68 cities, counties and states. For its part, the company started imposing a “Regulatory Response Fee” in 57 of those places, including such major cities as Chicago, Cleveland, Philadelphia, St. Louis, Seattle, Denver and Tucson. That fee amounted to a $1 to $2.50 surcharge. At the time, the company said it was an attempt to recover what it saw as lost revenue.
Now, DoorDash said in the Tuesday announcement that the company is lowering pickup commission costs to 6 percent. The company said the moves were in response to feedback from restaurants.
“There is a massive, increasingly digital opportunity for small restaurants, and we believe that when we work together, we can help them capture more of that,” said Christopher Payne, chief operating officer of DoorDash. He said the company is “hopeful” that as restaurants reopen fully for in-person dining, DoorDash “can be a partner that helps restaurants accelerate into the future and continue growing.”
DoorDash went public last December in a much-heralded initial public offering (IPO) of stock. The restaurant industry, struggling through the COVID-19 crisis and virus regulations, has come to rely heavily on delivery services. The Silicon Valley company posted big increases in revenue last year during the pandemic.
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