Nassau eyes capping amount delivery services can charge restaurants
Restaurants struggling during the pandemic may be getting some relief in Nassau County as legislators consider capping how much delivery services can charge restaurants.
It's a charge few customers may be aware of, but not only are they being charged for deliveries, but apps like Grub Hub, Doordash and Uber Eats also charge the restaurant. Some say the price is as high as 30%.
Nassau County Legislator Joshua Lafazan wants to put a cap on that, limiting third party delivery services from charging restaurants to 15%.
"The high fees that are being charged are driving down or in many cases eliminating their profit margin altogether all the while, economic
challenges prevents restaurant owners from hiring their own drivers or developing their own proprietary delivery services," says Lafazan.
For a $200 order at Coach Meeting House, the owner says a delivery service may take up to $60 of it, and by the time he pays the sales tax, salaries and costs, they wind up with a profit of up to $10.
"I looked at the numbers, why am I doing this? I'm breaking even on this," said Rustan Lundstrum, owner of Coach Meeting House. "There's no reason to do it and I could create a job for a local kid, a friend's son whose home and I hired him as the delivery driver and I abandoned Uber Eats."
Some delivery services say that these caps actually harm the restaurants and customers.
Doordash said in a statement that, "Pricing regulations could cause them to increase the cost for customers." And Grubhub says restaurants may receive fewer orders. Lundstrum says the attraction to use these apps is for the exposure.
Similar measures have been passed in New York City, Albany, and Washington, D.C.
If passed in Nassau County, the law would be in effect all the way through 2022.