CHICAGO _ With dining rooms currently closed because of the coronavirus pandemic, restaurants are relying heavily on delivery and pickup orders for business. Many are now using third-party delivery services like Grubhub and Uber Eats to handle the logistics of the ordering and delivery process. But some restaurateurs have complained about high fees and other issues related to those companies.
This week, Chicago Mayor Lori Lightfoot and Chicago's Business Affairs and Consumer Protection announced new rules for the third-party delivery companies. According to a press release, the "first-in-the-nation rules" will "increase transparency and fair competition."
There are no new fees, but third-party delivery companies will now have to provide an itemized receipt that includes all of the charges. That includes the cost of the food, any taxes, delivery charge, tips and "any commission or service fee paid by the restaurant to the third-party delivery company." According to the city, right now "customers may believe that the restaurant is receiving the full menu price of the food," even though that's not the case.
In an official statement, Grubhub says that while they "support policy and legislation that help restaurants serve their communities," they believe "a path to reopening these businesses must be the focus."
They don't believe these new rules help, saying, "These arbitrary disclosure rules, however, represent unprecedented and illegal interference in private contracts freely entered into and negotiated by two companies. Even worse, the rules will do exactly the opposite of their intent by causing confusion to consumers. These efforts by policymakers risk discouraging people from enjoying restaurant meals safely at home and hurt our efforts to support restaurants."
Nick Kokonas, the CEO of Tock, is less worried. "It proves our point," writes Kokonas in an email. "Tock charges a flat 3% of the sale to the restaurant. I suppose we will have to disclose that on the receipt now ... but it doesn't affect the customer at all, and it's as much as 8 to 10 times less than some other services which can charge up to 30%."
