Tuesday, January 26, 2021

Again: Thinking Things Through

The San Diego Mayor just imposed an upper limit on what can be imposed by third party delivery services who deliver food orders; 15% of the total amount of the order. He says that will help the companies that are selling delivery food, because drivers were adding as much as 30% to the cost of the order. 

 

 First, it's usually the customer that pays the fee, not the seller, so I'm a little uncertain of his thinking, but let's assume that the high delivery fees are driving customers away. How does it help if you drive the delivery service away? (You see what I did there? Twice!) 

 

Let's say you are delivering a $25 order. You have to get in your car, drive to the restaurant, wait for the order to be ready, drive to the customer, take time for the customer to pay you, process the credit card payment, pay the cost of the credit card payment (usually 3-5%), and then drive home. At a 30% fee, you would receive a princely sum of $7.50 for doing all this. The Mayor wants to cap this at a maximum payment of $3.75. 

 

Does that meet San Diego's minimum wage of $15/hr? I don't think so. Sort of an odd political agenda to want to raise what workers earn and then cap what they can charge. Still, he is a Democrat, so we should not expect consistency or logic from him.

 

What they Mayor did, of course, is raise to approximately $100 (for which the driver would get $15) the minimum food order that you can get delivered. That may be okay for four or more people who live together, but for a single person or a childless couple who want to stay home and have food delivered it might not work out too well.

1 comment:

bruce said...

well, usually the driver is paid via a service that handles all the bookkeeping and all, so you don't actually pay him directly. And you forgot tips in that too. And it's often the restaurant (or business) that pays the fees involved in associating with a delivery service.

But your point is well taken in that delivery drivers (delivering anything, not just food) don't get paid well and often don't have workplace protections. There was a multi-billion dollar intitiative recently passed about just that very thing.

Delivery services are a godsend to those who cannot or should not venture out. And politicians in ivory towers want to mess with stuff and not think of all the possible consequences. Par for the course.

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