With restaurants under the gun due to the coronavirus pandemic, the DoorDash company is apparently poised to help out with major changes to its service model and fee structures.
Reports today show the company is offering to help restaurants to build their own online order websites, which will circumvent their need to relying on DoorDash for online orders.
You don’t often see this kind of altruism in business, but the details of these reports show that DoorDash is doing this partially to help their client base to survive.
In other words, without the restaurants, DoorDash doesn’t succeed.
With that in mind, restaurants have been calling for fee reform for some time.
“Commissions as high as 30% paid to delivery companies – including Grubhub Inc, Postmates and Uber Technologies Inc’s Uber Eats – are a sore spot for some cash-strapped mom-and-pop restaurants,” writes Hillary Russ. “The fees, especially those charged for marketing, are under increasing scrutiny, with deliveries rising as people have stayed home to stem the spread of the coronavirus.”
What changes might look like is still being worked out, but DoorDash reports it has already suspended some of its fees for restaurants grappling with coronavirus losses, and that the fee structures that will emerge out of the new model will be different.
“Restaurants will also not have to pay most fees for the new DoorDash Storefront service through the end of the year, providing some relief to a ravaged industry as it starts reopening in some areas, DoorDash’s Chief Operating Officer Christopher Payne told Reuters exclusively,” Russ writes. “DoorDash waived commissions over the last couple of months and provided other relief totaling about $120 million to help independent restaurants through the pandemic, Payne said.”
By helping restaurants to become self-capable of handling online orders, the software company may be conducting a major rescue operation that can have a big impact on boosting the American economy as it recovers from closures. Will this make DoorDash a blue chip? We’ll see.