Will a plan by some provinces to cap the fees that food delivery apps can impose on restaurants drive the delivery companies out of business, or is there perhaps another way?
Prof. Michael von Massow is a food economist in U of G’s Department of Food, Agricultural and Resource Economics who studies the performance of food supply chains. He believes the entire business model of food delivery services is currently broken.
As von Massow wrote in a recent post on his Food Focus blog, while restaurants say the fees cut into their already thin profit margins, the delivery companies aren’t making money either – even during this pandemic when many restaurant lovers are ordering more often than ever.
“There may be merit in the app companies and delivery drivers sharing some of the pandemic pain with restaurants,” von Massow wrote, noting the entire model requires restaurants to succeed.
That might mean shifting the model so that delivery apps only deliver and don’t take orders. Or it might mean changing the fee structures.
“Flexibility here is in everyone’s best interest,” he wrote.
Von Massow is available to discuss what he thinks is wrong with the current delivery app model, whether fee regulation might help (or hurt) the industry and what he thinks might be a better approach.
He is available for interviews.
Prof. Michael von Massow