Restaurants say delivery charges sometimes surpass their profits, here’s what you can do

FOX Files

ST. LOUIS COUNTY, MO – Some restaurants say food delivery services are not the answer to their survival. Some are trying to find ways to handle delivery and curbside in-house so more money goes to their employees.

At Satchmo’s in Chesterfield, if you order from their website, it goes right here to an employee who will bring you your food. Consider asking your favorite restaurant what order method they prefer, because some delivery services take more of a cut than restaurants can make in profits.

“What people don’t realize is that delivery services keep between 15% and 40% of the gross revenue to run the delivery.” He added, “That’s a huge portion of the gross revenue that these delivery services are taking, and a restaurant cannot sustain itself. There’s just not enough margin to make that work under any kind of long-term sustainable basis,” said Andy Kohn of EdgeWild.

EdgeWild’s Chesterfield location has 400 seats they can’t currently fill. Kohn says curbside and delivery bring only 10% to 20% of what they can make when they’re open inside. He’s also hurt by not having a drive-through.

“The funny part about it each of the three locations that I’m associated with, the cities all made it very clear when I came to apply for permits, that they didn’t want drive-throughs,” said Kohn.

He says two things are currently saving EdgeWild, dedicated employees and generous customers.

“(Customers are) sometimes giving two and three times the cost of the food in the form of a tip to the employees. It’s really heartwarming to see the good that comes out of this, not necessarily all bad.”

Kohn says EdgeWild prefers getting a call or even better, an online order.

“We have order tools online that go directly to the restaurant that bypass the delivery services. The system is such that when you order something on your computer on our web site – it goes right into our system.”

It’s the same at Satchmo’s, where again, your order on their website comes right into the restaurant. Co-owner Benjamin Brown added that there are some delivery services offering breaks and rate deductions during this pandemic.

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