NEW, LOCAL CHALLENGERS ENTER THE MARKET
Big delivery apps including Uber, Grubhub, and DoorDash have recently found themselves in hot water, facing a class action lawsuit over delivery fees, according to a report from Legal Newsline (June 22). The high fees implemented by these companies are spurring independent restaurants to explore their own delivery options.
In response to soaring costs, Iowa City, Iowa restaurant owner Jon Sewell started Chomp, a delivery service that now works with nearly 200 restaurants in the city and nearby Cedar Rapids, reported Bloomberg (June 23). Restaurants pay commissions of 15%—compared to the 30% charged by apps such as Grubhub—and drivers earn an average of almost $20 an hour.
After being asked for help in setting up similar services, Sewell created Loco Co-ops, a company that sells technology and know-how to restaurants interested in establishing delivery cooperatives. LoCo operates in Las Vegas, Omaha, and Knoxville, Tenn., with three more cities in the works.
“There’s nothing that DoorDash, Grubhub, and Uber Eats do that can’t be replicated locally and operated at a much lower cost,” Sewell told Bloomberg.