Wednesday 13 May 2020 12:01 am

Restaurants hit out at delivery platform fees during lockdown

Restaurant industry experts have hit out at takeaway delivery companies during the coronavirus outbreak, saying Deliveroo, Just Eat and Uber Eats make more than £1bn a year in fees through UK restaurants. 

A study found that three in five consumers have tried to support their favourite local restaurant during the lockdown by ordering through an online marketplace. 

Read more: UK lockdown: No pubs or restaurants to reopen until July ‘at very earliest’

However, 48 per cent of customers were unaware that up to one-third of their payment was taken as commission, and 59 per cent felt it was unfair to charge high commission, according to a survey by online ordering tech firm Flipdish. 

Takeaway market expert Peter Backman estimated that the three major takeaway ordering platforms Deliveroo, Just Eat and Uber Eats were securing more than £1bn in annual fees from UK restaurants. 

More venues have begun to accept deliveries during the coronavirus pandemic, as it offers an additional revenue stream while physical restaurants are closed during lockdown. 

“Many operators, who have previously steered clear of delivery, are having to switch to a takeaway and delivery only offer,” Backman said.

“It’s not an ideal model in terms of the bottom line but it puts cash in the till and businesses will take anything they can get in this unprecedented time.”

However, Tom Salt, executive chef at Manicomio, said: “Big tech firms are holding small independent restaurants to ransom.”  

“Post-Covid,  restaurants will need to find extra revenue streams,” he said. “For some, the answer might be takeaway and delivery but at what cost?”

Tanisha Broady, owner of independent Caribbean restaurant Rock of Virtue in Cambridge, added: “The public don’t quite realise how much money food delivery companies like Just Eat and Deliveroo take from independent restaurants. They take a ridiculous cut.”

Read more: Robot waiters, half the tables, and crossed fingers: How restaurants will reopen after UK lockdown ends

All restaurants were forced to close under the UK’s coronavirus lockdown, although they are allowed to offer takeaway and delivery services. 

The sector will remain closed until at least July, when the government has said there could be a phased reopening of hospitality businesses. 

Deliveroo, Just Eat and Uber Eats all said they have measures in place to support restaurant partners, and that fees were used for operating costs.

“Deliveroo is passionate about supporting the small, independent restaurant partners on the platform, who benefit from being able to access a wider customer base through delivery,” a spokesperson said. “Deliveroo is committed to supporting our partners’ growth.”

The platform has suspended joining fees during the crisis, it said.

A spokesperson for Uber Eats said it was committed to supporting restaurants during the coronavirus crisis.

They said: “At the beginning of the crisis, we put in place a range of initiatives to help restaurant partners, particularly small business owners, as they keep their kitchens firing to feed people across the country.”

“Just Eat is only successful if our restaurant partners are successful and we believe our commission rates are aligned with the value we provide to our partners,” a Just Eat spokesperson said.