Small business owners and delivery drivers have voiced their frustrations, alleging that Uber Eats is taking advantage of them, creating a tough situation for many. Ross and Joe, who operate Super Nash Brothers in Sydney, specialise in Nashville-style fried chicken and have worked diligently for five years to establish their business, now comprising three stores. They claim that delivery fees are exorbitant, with Uber Eats charging 33% for platform access.
Initially hesitant to use platform ads, the pair noticed a significant reduction in their visibility and order volume, compelling them to invest in advertising. Despite this, they faced staggering costs, with recommendations suggesting they spend between $71 and $165 per store per day, alongside the hefty service fee.
Recently, Uber Eats introduced new policies, including an ‘offer fee’ for discounted items and an obscure ‘merchant success score’ that jeopardises restaurant visibility based on marked-up pricing. Ross and Joe assert that they must inflate menu prices to offset delivery costs, yet this strategy has led to diminished visibility when they offer deals, leaving them uncertain about the additional charges being implemented.
“The pricing adjustments are necessary for covering operational costs, yet it seems counterproductive when doing so undermines our standing on the platform,” Ross explains. With Uber Eats orders making up half of their sales, they face a difficult balancing act: raising prices to stay afloat or risking financial loss.
Uber Eats claims over 60,000 restaurants in Australia use their service, attributing the growth to consumer demand for delivery options. However, experts like QUT Professor Gary Mortimer contend that while transparency is vital, penalising businesses for needing to raise prices is unfair. A recent report highlighted that while 96% of surveyed restaurants noted increased revenue from online food delivery, 25% admitted to struggling with delivery costs.
Delivery drivers also share similar grievances. Sadeeqa, a single mother who turned to Uber Eats for supplementary income, commented on the challenging realities faced by drivers, including long waits at stores, insufficient compensation for delays, and the bulk of their earnings consumed by petrol expenses. “On average, I earn $70 to $80 for four hours of driving,” she stated, lamenting the lack of payment for delays outside her control.
In response to the backlash, Uber Eats maintains that their model is designed to benefit consumers, restaurants, and delivery personnel. They introduced the Success Score to assist restaurants in delivering quality service, asserting that their platform enables significant growth for partner businesses.
Ultimately, both restaurateurs and delivery drivers find themselves navigating a complex landscape that demands financial viability while adhering to the constraints imposed by the delivery service.