Written by The Business Journal Staff
Online delivery company DoorDash announced Friday it would reduce commission fees by 50% for restaurants that use its service for home delivery.
The San Francisco-based company said it would reduce fees on restaurants through the end of May. They estimate the savings to its 150,000 partner restaurants in the United States, Canada and Australia at $100 million, according to a press release.
“We have already invested more than $15 million in combined commission reductions and marketing efforts, and we’ve seen restaurants across the country generate millions of dollars in incremental sales—revenue that has been vital to helping them keep their doors open during the first weeks of the coronavirus crisis,” said Tony Xu, CEO and Co-Founder of DoorDash.
DoorDash also provided deals to restaurants such as zero commission fees for 30 days for new restaurants signing up for Door Dash and zero delivery fees for certain restaurants, generating what they estimate to be $200 million in sales.
Of late, many restaurants have come to rely on pickup and delivery to stay open. Many delivery services can charge as much as 30% commission on orders, according to Chuck Van Fleet, president of the Fresno Chapter of the California Restaurant Association in a previous interview.
Also on Friday, San Francisco Mayor London Breed announced a cap on what restaurant delivery services such as Postmates, Uber Eats and DoorDash can charge restaurants at 15%.