Up to 91% More Expensive: How Delivery Apps Eat Up Your Budget

After a long day, you have probably done some back-of-the-napkin math and decided there was no point in going out for dinner when you could get food brought to your door for the same cost, plus a tip. So you fired up a delivery app.

Too bad the numbers aren’t that simple.

When you order through a delivery app, you pay multiple parties, including the driver and the companies that offer the apps, like Uber Eats and Postmates. In some cases, you pay the restaurants extra fees as well.

The markups can be downright egregious. Take Panda Express, the fast-food chain. If you ordered a $39 Family Feast value meal using Uber Eats, your tab would be 49 percent higher than if you bought the same meal at the restaurant.

You would have to really love Panda Express to pay this kind of premium — and that doesn’t even include a tip.

The extra fees creep into your bill for various reasons. Some restaurants hike the prices of food ordered for delivery. And most of the popular apps charge a delivery fee and cram tax and extra service costs into a single line on the bill, making it difficult to notice the inflated costs.

To give you an idea of the true cost of delivery app convenience, I tested some of the apps. Read on for what I found. (Hint: It wasn’t pretty.)

I focused my tests on DoorDash, Postmates, Grubhub and Uber Eats, the four largest delivery apps in the United States. To compare them, I used all four apps to make identical orders — such as the same kind of pizza — from four restaurants.

The results, for the most part, followed this trend:

The markups on the food deliveries were 7 percent to 91 percent more than what you would pay if you bought the meal directly from the restaurant. Yep, you read that right.

Uber Eats bills were high across the board, which was surprising because it offers practically the same type of service as Grubhub and DoorDash.

But unlike the other apps, Uber Eats charged a $3 “small order” fee when I ordered the sandwiches from a Subway. Plus it added a 15 percent service charge and a separate $3.99 delivery fee, which was determined by my proximity to Subway.

Meghan Casserly, a spokeswoman for Uber, said that the company’s goal was to deliver meals to people as quickly as possible, and that the transparent fees covered operating expenses while fairly compensating workers.

Yet among the four apps, Uber’s service charges were also the most unpredictable, I found. Its delivery fees fluctuated depending on the availability of couriers when I placed an order. That was similar to Uber’s so-called surge pricing for rides, which it uses to get more people to drive when rides are in high demand.

Postmates’ markups were also confusing. Its delivery fees and service fees both vary widely, depending on the merchant you are ordering from. For the same Subway order, its delivery fee was $2.99, lower than Uber’s $3.99. But its service charge was highest at about 16.4 percent, or $2.42.

Postmates service charges can skew higher in part because it doesn’t deliver only meals. Its couriers offer to bring you practically anything they can pick up, from a pair of sneakers to a birthday cake.

Other delivery apps generally have relationships only with restaurants, so their offerings are more limited and they charge a smaller service fee. DoorDash’s service fee for the Subway order was 11 percent, and Grubhub’s was 5 percent.

Another thing to look out for are food prices that are inflated to cover delivery expenses.

In my tests, this practice was most evident at Panda Express. While the family value meal’s normal cost was $39, the price was listed at $44.85 in Postmates and $47.10 on Uber Eats, DoorDash and Grubhub.

Be the first to comment

Leave a Reply

Your email address will not be published.