For many restaurants and fast food chains, Doordash has been a life-changer. The Doordash marketplace connects eaters, restaurant-partners, and delivery-partners.
Especially during the pandemic outbreak, the food delivery service has enabled local restaurants to stay open by eliminating many of the difficulties involved with the cloture of the dining rooms.
Doordash is an easy way to sell your products, and it has gained incredible popularity.
That said, Doordash also has a few downsides. Perhaps the biggest complaint among restaurants regards Doordash’s fees.
In this article, we’ll break down Doordash’s pricing and fees. We’ll explain how you can know if DoorDash costs are worth it, and then we’ll give a few strategies for succeeding in the delivery marketplace. Let’s get into it!
Since the pandemic, much of restaurant survival relies on online orders. In 2018 DoorDash also added a pickup option. The order ahead feature is really appreciated by consumers that can collect the meal at the restaurant avoiding delivery fees.
If you want to enter your business in the e-commerce world, with Doordash you do not need coding skills, design knowledge to create your own website or to hire a freelancer in Upwork.
But do restaurants pay Doordash? The Doordash business structure has a Y structure business model. The concept is simple: you don’t own DoorDash, but instead pay a monthly fee to use it. Third-party companies including DoorDash, Uber Eats, Postmates, and Grubhub can charge commission on each delivery.
If you want to find out how much DoorDash charges restaurants, you are at the right place. First of all, there is no starting fee to join the DoorDash App.
The San Francisco headquartered company offers four subscription options for DoorDash partner accounts. Let's see what each plan offers, including the pricing, in more detail.
Delivery Commission: 15%
Pickup Commission: 6%
Delivery Commission: 25%
Pickup Commission: 6%
Delivery commission: 30%
Pickup Commission: 6%
This is the cheapest solution when you have your own delivery fleet and your goal is to reach more customers.
Commission for customers orders: 12%
Pickup Commission: 6%
There are a few key features to watch out for, and not miss by selecting the wrong Doordash plan.
Plus and Premier account have access to a bigger delivery area
The “Plus” plan has an approximately 10% larger delivery area than “Basic.”
The “Premier” plan has an approximately 15% larger delivery area than “Basic.”
The growth guarantee promotion is available only for Premier accounts. Basically if you accept less than 20 orders per month, DoorDash will refund your commission costs for that month.
According to DoorDash,DashPass subscribers grew more than twice as fast as non-DashPass monthly active users.
Additionally subscribers increased average order frequency to record levels since they get free delivery. Plus and Premier plan give you access to DashPass members
💡 PRO TIP: Keep in mind that you can always change your monthly subscription type. An upgrade or downgrade will initiate a new billing cycle and close the current one.
The merchant agreement outlines the relationship between the technology company and every merchant on the Doordash platform.
You should not face any added costs and Doordash covers these services with their commission fees.
All the Doordash plans provide the core e-commerce functionality you’d expect and there are no hidden fees for the restaurants on the Doordash platform.
The following fees are included in your monthly plan:
Unlike other online platforms, DoorDash will not charge you a listing fee.
You can create an online menu and catalogues of unlimited products.
Partners can use the new Menu Editor tool to upload and make changes to their menu directly through the Merchant Portal.
The order manager tool is available anytime anywhere via any browser or the DoorDash merchant app. The app is currently available only for Android devices.
The platform offers 24/7 support for business, customers and Dashers.
You can easily contact the support team at 855-973-1040
As you probably know, DoorDash is a cashless app . Customers pay orders directly from the app.
In order to accept online payments, DoorDash must pay payment processing fees. Payment processors networks (such as Visa, American Express) typically offer their services at around 2.5% per transaction.
This allows DoorDash to accept payments by credit card, debit card, Gift Card and Google Pay.
Processing fees are included in your monthly plan.
Doordash is committed to ensuring that the Doordash app remains safe for driver-partners, merchants and customers.
Applicants who want to start delivering in the DoorDash platform have to pass a background screening.
Doordash provides third-party insurance to help protect Dashers in case of an accident while making a delivery on the DoorDash app.
Choosing Doordash, you do not have to create your own fleet of delivery drivers. Doordash takes care of everything.
Despite the driver shortage that hit major rideshare companies, people love to deliver with DoorDash.
Of course your DoorDash commission rates include the pay for Dashers.
You are able to use your tablet or you can lease a tablet provided by DoorDash for a weekly fee of $6.
So, are Doordash costs worth the expense for your business?
There is a significant chance you would have been asking this question to yourself after going through the whirlwind of poles apart opinions on Doordash being published every day.
Basically, if Doordash is worth it for your business it depends on a few factors: your profit margins, and the value you derive from the marketplace.
What value does Doordash provide to your business?
The first and important value is the ease of being found by new customers.
Doordash is the fastest growing food delivery platform in the United States. The company has an established audience. They went from 4 million users to 20 million users in 2020.
The second and important feature of the DoorDash platform for partners is the ability to sell products online without having to maintain a website or create your own app.
These two values are a huge factor in your decision to use the marketplace despite the Doordash merchant fees.
If you are still uncertain that ‘Is joining DoorDash worth it or not, keep in mind that you can test the platform with a 30-day free trial.
After the trial period ends the monthly fee will show up on your payment account.
DoorDash partners have different opinions regarding partnership plans. Some merchants say that DoorDash is the most affordable e-commerce option for their business, while others say that DoorDash’s fees are forcing them to leave the platform.
We interviewed Rufo Emiliano Verga, the owner of Gran Milan, an Italian restaurant located in the Bay Area of San Francisco. He said:
I like DoorDash, it was for me the easiest way to quickly launch an online store without the fuss over servers and development costs.
Since the start of the pandemic I had to rethink the way I run my business.
Listing my menus on the DoorDash app increases my profits. My business is growing despite the pandemic.
Now that you know exactly how much you will pay, read on for tips that will help you grow your business and in the man time stay on top of DoorDash for business fees:
The most obvious way to protect your profits is to increase item pricing. Restaurant owners are often worried that increasing the cost of their goods will make them less competitive.
You can always keep track of your competitors.
The share of delivery orders versus dining in orders impact the tasks you have to perform and your organization. Here are some question you should ask yourself:
Using DoorDash, your floor staff can focus on other tasks such serving in-house diners.
Marketing campaigns will help you drive more customers to your business. Take a look at our guide to DoorDash marketing materials.
Previously in March 2020 Doordash launched a package of commission relief and marketing support for new and existing DoorDash partner restaurants to help them generate up to $200 million in additional sales.
The truth is that all the top delivery apps like Grubhub, DoorDash, Uber Eats and Postmates charge restaurants commissions in different ways, often depending on the individual restaurant and what services they decide to use.So, do cheaper alternatives really exist?
A web developer in Toronto has created a site that allows restaurant owners to bypass these fees.
The non-profit project, dubbed Not UberEats, is inspired by the Not Amazon service, a platform that lists small local businesses in Toronto. Randy Singh, the creator of not-ubereats.com, says he came up with the idea after learning about his favorite restaurants closing.
Restaurant owners can register on the site for free, and customers can search by distance and types of kitchens offered.
Since its launch in early January, the site has attracted nearly 7,000 visitors. According to Mr. Singh, the number of visitors continues to climb.
Additionally, recently we saw new online ordering platforms expanding across the U.S. and Canada.
ChowNow, for example, is a platform that connects customers with local restaurants via:
However, the number of DoorDash users matters!
The platform currently powers around 4 million online stores and the company has over 5 million DashPass membership subscribers.
These numbers matter because, indeed when you choose an e-commerce marketplace for your store, you should always choose one that users trust.
If you want to know how to get on the Doordash platform, these are the steps you’ll have to follow:
DoorDash for business owners is a great way to reach new audiences and markets, without having to invest in marketing yourself.
Doordash offers resources that your store may just not have including a network of safe delivery drivers riders and real-time order tracking. Despite the commission fees, being listed on the DoorDash platform will help you improve the visibility for your business.
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