Restaurant owners say delivery fees can put companies out of business

BOSTON — While we all may enjoy having our food delivered, some restaurants say the lack of people dining in is hitting them particularly hard.

Massachusetts Restaurant Industry held a Save The Restaurants rally at the State House on Wednesday to demand the passage of bill H4887. They say this economic development bill will cap delivery fees that third-party companies like Uber Eats DoorDash and Grub Hub charge.

Section Section 108E (b) states “no third-party delivery service company, from the effective date of this act and for a period of 45 days after the termination of the COVID-19 emergency, shall charge a covered establishment a delivery fee per online order for the use of its services and fees other than a delivery fee that totals more than 15 per cent of the purchase price of the online order.”

Since in-house dining was forbidden for much of this year, delivery sales skyrocketed going from about 10% of restaurant sales to about 65%.

But some restaurants say they will not be able to remain open during the pandemic if they are losing almost a quarter of their total revenue to these delivery companies.

“It’s what economists call an oligopoly, and oligopolies do not compete over his price, they sell price and in this case the price they said it was 25 to 30% of the price of a meal,” said Harvard Square Business Association Member and owner of El Jefe’s Taqueria John Schall. “I had $360,000 in delivery sales for the first eight weeks after the pandemic and I paid the delivery companies $93,000 during those eight weeks. At the same time I lost $18,000 in those eight weeks.”

The language of the bill has been passed by the House but these restaurant owners say they’re still waiting on the Senate to act.

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