A pizza chain has stopped using Uber Eats after the delivery app's commission fees reached 30%, highlighting the growing tension between restaurants and food courier platforms. The move comes as many eateries say they are forced to hike menu prices on apps to offset the high charges, often passing the cost onto customers.
Restaurants report that fees from apps like Deliveroo, Uber Eats, and Just Eat can be around 30% of the order value. To compensate, many raise prices on delivery menus. For example, a fish and chip shop in St Andrews charges £11.20 for haddock and chips in-store, but £14.40 via Deliveroo, a 29% increase to cover the app's fee.
Small business owners say the fees make it difficult to profit. Deepak Shukla, who runs three cafes in south London, charges £3.90 for a cappuccino on delivery apps versus £3.10 in-store. 'We inflate prices to support the fact that Deliveroo take a commission,' he said. 'Otherwise, you'd make a loss.'
Customers also pay service and delivery fees on top of the inflated menu prices. Uber Eats charges a 10% service fee (minimum 99p, maximum £2.99), while Deliveroo and Just Eat charge 5%. Delivery fees vary by distance. One north London restaurant owner said a £11.95 chicken biryani costs £15.30 on Uber Eats, plus fees, totalling £18.12.
Not all restaurants raise prices; larger chains may keep prices consistent. However, consultant Peter Backman noted that many customers are willing to pay more for convenience, especially since lockdowns normalized food delivery. 'There is a whole class of customer for whom the convenience of having a hot meal delivered within half an hour is a huge benefit,' he said.
Deliveroo said it encourages restaurants to set the same menu prices as in-store, adding that partnering with the platform saves them from providing their own delivery services. But for many small businesses, the 30% commission remains a hard pill to swallow.
