DoorDash
Restaurant · Rincon Hill ·
Delivery platform with convenience, but customer service issues persist
Delivery platform with convenience, but customer service issues persist
"I read that one of San Francisco’s homegrown titans in the food-tech sector — DoorDash — laid off about 1,250 employees, roughly 6 percent of its workforce, after CEO Tony Xu posted on the company’s internal blog that the pandemic-incited growth spurt ran up against a weak economy; “This hard reality ultimately led me to make this painful decision to reduce our team size,” Xu wrote. A DoorDash representative told SFGATE the company had about 20,000 workers before the layoffs, while SEC filings show the company began 2022 with about 8,600 workers. This was reported as the first major round of layoffs for food delivery companies in 2022, occurring amid broader tech downsizing at firms such as Twitter and Meta." - Paolo Bicchieri
"Announced on April 27, DoorDash is offering restaurants three commission tiers — a 15% “basic,” 25% “plus,” and 30% “premier” plan — presented as a response to restaurant feedback. The 15% level currently matches San Francisco’s pandemic-era delivery cap, but it’s unclear how bare-bones that tier really is or whether restaurants can profitably use it; the city’s temporary cap will remain only 60 days after indoor dining returns to full capacity, so its future is uncertain. Per DoorDash, the basic 15% plan has the highest delivery fees for customers and limits the delivery area; the 25% plus plan reduces customer delivery costs, expands the delivery area, and enrolls restaurants in a loyalty program; and the 30% premier plan offers the lowest customer fees, the largest delivery area, the loyalty program, and a promise to “guarantee growth” of 20 or more orders a month or refund those fees. DoorDash is also lowering app pickup fees to 6% and launching a “storefront” product to process orders on restaurants’ own sites for a processing fee. Local restaurant group leader Laurie Thomas said the tiering is a step in the right direction but warned that a limited delivery radius could force restaurants to opt into higher tiers and that the value depends on whether a restaurant needs DoorDash’s marketing and placement. The announcement also evokes past criticisms of delivery apps during the pandemic — adding restaurants without consent, opposing driver benefits, underpaying hazard pay, and raising delivery fees for customers — and comes after DoorDash’s December IPO that benefited its founders." - Becky Duffett
"Backed by massive venture funding, it popularized heavily subsidized consumer pricing through deep promotions that trained diners to expect cheap delivery. That strategy is said to commoditize convenience, allow enormous spending to expand market share, and leave restaurants dependent on a model that extracts high commissions, limits direct customer contact, and undermines long-term profitability." - Deepti Sharma
"I read that the San Francisco-based food delivery company DoorDash sent drivers a letter, shared by Gig Workers Rising, saying they'd be paid an additional $0.78 per day for protective measures during the crisis; Broke-Ass Stuart reports the 78 cents applies only to San Francisco workers in response to the city's April 21 emergency ordinance requiring on-demand delivery services to reimburse employees for hand sanitizer, disinfecting supplies, and PPE such as gloves and face masks. The DoorDash email stated that "for each day you complete at least one delivery in the CA: San Francisco Starting Point, you’ll receive an additional $0.78 daily deposit on top of your regular earnings," which DoorDash says should cover wiping down frequently touched surfaces in vehicles but does not address how it will cover the ordinance's PPE requirements. As of June, the company had a valuation of almost $16 billion and an estimated median executive salary of $100 per hour, and it has spent tens of millions fighting to keep drivers classified as independent contractors while backing Proposition 22; that effort suffered a blow when Judge Laurie Earl ruled the ballot must describe the measure as one that "Exempts app-based transportation and delivery companies from providing employee benefits to certain drivers." - Eve Batey
"A San Francisco-based delivery leader that controlled about 35% of the delivery market in October 2019, it has grown both organically and by acquisition (notably purchasing a higher-end delivery service) to span a broad range of restaurant offerings and consolidate market share." - Erin DeJesus
