By FusionPOS | Jan 27, 2021
Takeaways Struggle With Commission-Based Food Ordering Apps
There is no doubt about the fact that the number of food ordering apps is continually rising because people love such apps that allow them to order a variety of food from different restaurants. However, the business model of every food ordering app varies from each other as some apps like Fusion Kitchen does not charge any commission from the takeaways. On the other hand, there are many apps that are charging a hefty fee from the restaurants.
Many problems are associated with commission-based food ordering/delivery apps because they add financial pressure to restaurants that are already facing challenging conditions in the food industry. Here are some of the major problems faced by takeaways while using the services of commission-based food ordering/delivery apps:
Commission
Most of the food delivery apps are charging 20% to 30% commission on every sale. It means restaurants are paying a hefty amount of money to such platforms and thereby earning no profit for themselves. Many restaurant owners and managers have complained that such high charges are unfair and even result in wasting their time and efforts put in making great food. As a result, calls for fair and balanced contracts have greatly increased that can allow both food ordering apps and restaurants to make reasonable profits.
Long-Term Disadvantage
The COVID-19 pandemic forced a lot of takeaways and restaurants to partner up with food ordering & delivery apps and use their services to survive in these unprecedented times, even when they don't want to pay heavy charges. Despite several requests, commission-based food delivery apps like UberEats have declined to reduce commissions due to which restaurants are getting an unfair deal over the long-term.
Another important aspect of such partnerships is that typically long-term contracts are signed between restaurants and food ordering/delivery apps. It means that the takeaways will be forced to pay commissions and other additional charges. This kind of long-term commitment can prove to be a significant disadvantage as it cuts down their profits.
Competition
Many people have the opinion that commission-based food ordering apps are taking advantage of the sudden collapse of the food industry during the pandemic. Restaurant owners that did not even offer online delivery options were forced to use the services of food delivery apps to keep their businesses open during the pandemic.
A lot of restaurants even tried to introduce their own independent online order and delivery platforms, but they were not able to get that much success. The main reason for this fact is that food ordering apps have been operating in the food industry for a couple of years now. They have established strong roots in the market.
As a result, most of the takeaways and restaurants are facing strict competition from such food ordering apps. Therefore, they are often forced to partner up with them because they do not have enough resources to compete with them.
The bottom line is that you should remember that not every food ordering app is the same. You can rely on a platform like Fusion Kitchen and FusionPOS that allows you to generate 100% profits without spending any money. It does not have any hidden fee or additional commissions, so you can fully rely on Fusion Kitchen to run your restaurant.