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Restaurateurs Discuss the Hardship of Third-Party Delivery Services

Omar Yeefoon of Shoals has been on a roller coaster through the pandemic. Third-party delivery services haven't made it easier, he says.EXPAND
Omar Yeefoon of Shoals has been on a roller coaster through the pandemic. Third-party delivery services haven't made it easier, he says.
Doyle Rader

Fed up with his current situation, Omar Yeefoon took to Facebook to express himself. There, the owner of Shoals Sound & Service in Deep Ellum posted his thoughts on what has become a staple industry during the pandemic.

“Food delivery apps are pimps,” Yeefoon wrote. “Your favorite restaurants are being trafficked.”

Given the ubiquity of food delivery apps such as Uber Eats, DoorDash and Grubhub, his comments may come as a surprise. In the early days of the COVID-19 crisis, when restaurants closed their doors to the public, services' allure as potential lifelines looked promising. After working with them, Yeefoon says, the reality is much different.

Now, he and others are severing ties with the companies. They say the apps create undue burdens for their businesses and they are better off going it alone.

Yeefoon’s frustrations have been building for a while. To keep Shoals visible, he used multiple delivery marketplace services. It wasn't easy. He had to dedicate a significant amount of time integrating various software point-of-sale systems into his own accounting process.

Making matters more difficult was the degree of detachment created between him and his customers, which often led to confusion. It affected the quality of his product and the experience of the customer.

“If they had a bad experience, that experience is down to the restaurant that prepared their food, right? Like it kind of should be,” Yeefoon says. “That’s why we’re here. That’s why we’re in this business. But it doesn’t quite work that way once you put the middleman there.”

The middleman is also bleeding him dry, he says.

Small businesses like his must foot a number of costs associated with being listed on various marketplaces, including sales commissions, marketing and a number of other built-in fees. They add up quickly, and Yeefoon says he watches his restaurants’ profits go out the door with each app order he fulfills.

“It’s pretty much moving deck furniture around on the Titanic,” Yeefoon says.

Yet, he agreed to the costs associated with being on the delivery marketplaces. Companies like Uber Eats and DoorDash work with business owners to determine the individual needs of the restaurants they serve. Before the two parties go into business together, they negotiate all costs before entering into a contractual agreement.

“Food delivery apps are pimps. Your favorite restaurants are being trafficked," Omar Yeefoon says.EXPAND
“Food delivery apps are pimps. Your favorite restaurants are being trafficked," Omar Yeefoon says.
courtesy of Omar Yeefoon

The fees the companies collect fund various operational costs, such as onboarding and paying drivers, maintaining technological infrastructure and staffing. They also go toward marketing for the restaurants. Uber Eats says its partners benefit from its ongoing consumer marketing campaigns, as well as several opt-in marketing programs.

DoorDash does not publicly disclose the percentage cut it takes from restaurants. Uber Eats, however, has begun cutting some of the costs of doing business with them because of the state of the industry. It waived all marketplace fees for pickup orders facilitated through its application and reduced delivery fees to 15% when a restaurant uses its own drivers.

“Uber Eats is committed to building products that bring true, measurable value to restaurants, which is all the more important during these unprecedented times,” Chris Miller, Uber’s senior manager for public policy in Texas, said in a statement. “We hope that our partners continue to find value from our partnership, and we’ll continue working to live up to their expectations.”

Despite their reassurances, Yeefoon is not the only one left unsatisfied by the industry. The owners of Ten Bells Tavern in the Bishop Arts District and Sandwich Hag in the Cedars have voiced their frustrations.

When Yeefoon posted his opinion on Instagram, a number of industry professionals chimed in about how the third-party delivery businesses were less than collaborative:

  • "We just learned that postmates without authorization listed Veritas Wine Room as one of their restaurant partners. We are not. The menu they are currently promoting is from 3 years ago." — Bradley Anderson, Veritas Wine Room, Hillside Tavern, Boulevardier, Rapscallion

  • "I worked a busy Saturday pre-COVID where no fewer than ten people claimed to be picking up for Doordash. They, similar to Bradley 's situation, had listed an old menu of ours without contacting us first. I don't think I've ever called a corporate number and threatened a lawsuit before or since in the middle of the rush. Suffice it to say, Doordash actually *could* unlist us that very night, when they put their minds to it." — Ben Reynolds, Knife

And a little over a mile away from Shoals, in Expo Park in South Dallas, owners of another small business weighed the pros and cons of food delivery apps after the pandemic made them closed their doors.

Las Almas Rotas initially partnered with several services to increase their exposure — paying a higher marketing fee in some instances — in the hopes of spurring sales. It didn’t happen. Like Yeefoon, they found the costs prohibitive.

“It really was just the percentage that they take,” says Shad Kvetko, co-owner of Las Almas Rotas. “It’s always critical in the restaurant industry as far as your margins go, and with them taking upwards of 32%, it just really didn’t make any economic sense. We’d be making and selling food, but that takes all the profit out of it.”

Kvetko echoes many of Yeefoon’s complaints about the service he encountered. Those issues, combined with the high costs associated with being on the marketplaces, caused the mezcaleria to forgo their services altogether, a time-consuming process.

“It really didn’t seem to be working as far as outreach anyway, and people were really enjoying our drive-thru because we kind of made it a little bit of an experience,” Kvetko says.

The alleyway/drive-thru of Las Almas Rotas in South Dallas.EXPAND
The alleyway/drive-thru of Las Almas Rotas in South Dallas.
Doyle Rader

The alleyway next to Almas became their lifeline. It’s where they created a festively decorated pop-up drive-thru where customers can pick up food and drinks after ordering through their Square site. They also recently expanded their patio seating on the sidewalk out front along Parry Avenue for those wanting to dine there.

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Shoals doesn’t offer drive-thru or patio amenities, but the menu specializing in plant-based Latin American street food is still available. Customers can place orders through the bar’s online portal through Toast. It will be the only way to get their food going forward. It won’t net Yeefoon the eyeballs that the apps provided, but it gives him a sense of control and peace of mind.

Where he once saw an opportunity, the lack of equity and care he says he encountered soured his experience. He sees the food delivery industry as preying on businesses and customers alike. Still, Yeefoon thinks there is a place for app-based food delivery; he’s just tired of being trafficked, as he puts it.

“I think that there’s a bit of responsibility that these companies should have to the businesses they serve and to the customers they serve,” Yeefoon says. “There needs to be a certain level of customer services and customer experiences. They’re paying so much more than they would pay if they were actually sitting in the restaurant having excellent customer service.”

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