Solving third-party delivery problems with sights set on Uber Eats, Grubhub and DoorDash

When an online app used for ordering takeout kept listing the menus of his Salvatore’s Tomato Pies restaurants without his consent, owner Patrick DePula became irritated.

“Even though we would tell them to take the menus down, they would go away, then come back,” DePula said.

Third-party food delivery services such as Grubhub, DoorDash, Uber Eats and Madison-based EatStreet can help restaurant owners connect with customers, especially during COVID, but they also can cause problems when they don’t have a restaurant’s permission to list their menus.

A bipartisan bill introduced in the state Legislature last month seeks to rein in those services.

DePula couldn’t wait for a legislative remedy, so when Grubhub kept posting his menus without permission, he took matters into his own hands.

Grubhub drivers would show up in his restaurants on Livingston Street and in Sun Prairie, and try to use a credit card to pay for something while jacking up the price paid by the customer to absurd levels, unbeknownst to DePula.

As a test, DePula said he had Grubhub deliver a single pizza, on the menu for $22, and it became $38 after fees and tips.

DePula said he finally told his employees to start charging the drivers a fee. “The first time it happened, we just charged an extra $300 on the Grubhub credit card. And they were like, ‘Uh, there’s a mistake.’ And I’m like, ‘Yeah, there’s a mistake. Stop doing it.'”

After he repeated that a couple of times, he said Grubhub got the message and took Salvatore’s off its platform, but now his other restaurants are showing up on Uber Eats.

Growing popularity

In the last few years, with indoor dining curtailed or eliminated by COVID-19 and its restrictions, delivery services have gotten more popular, and restaurant owners have complained about services putting menus on their sites without permission and charging exorbitant fees that can increase an order by as much as 30%.

Sen. Patrick Testin, R-Stevens Point, the bill’s lead author in the Senate, said legislators were approached by the Wisconsin Restaurant Association to take up the matter.

“They want some basic guardrails and assurances,” Testin said. “We want to make sure that there’s an agreement between any third-party vendor and a restaurant, that the restaurant agrees to have their information up there and to participate in the service.”

Testin said he was part of a stakeholder meeting Wednesday between the Wisconsin Restaurant Association and representatives from the third-party companies.

“I think we agree in principle that this is something that needs to be addressed,” he said. “We’re working with both sides of this to come to a good compromise that will be in the best interests of everyone.”

Kristine Hillmer, president and CEO of the Wisconsin Restaurant Association, said some third-party delivery services take the logo, the name, an old menu and old pricing, and put it on their app.

Then they will deliver for these restaurants with no formal relationship between them. The restaurant may not even have the ingredients to make the dishes that are ordered, she said.

“What it does is it puts the restaurants in a difficult position because they don’t have a relationship with that company,” Hillmer said. “It inserts themselves between the restaurant and the customer.”

Third-party delivery is not all bad, she said, “but this practice of saying they represent these restaurants when there’s no relationship really is very harmful.”

Hearing set

The bill, which will get a hearing at 10 a.m. Tuesday before the Senate Labor and Regulatory Reform Committee, at the Capitol in room 300 SE, would require that the delivery services ensure that menus, descriptions and prices related to a restaurant are accurate.

Under the bill, the services must also disclose to restaurants the amount of any commissions, delivery fees and promotional fees charged. They must also ensure that their delivery drivers have knowledge of basic food safety principles.

The services must also give restaurant operators access to details related to orders and must let operators view and respond to consumer feedback and reviews.

Testin said the bill as it is currently written, will likely be amended to accommodate some of the changes that were discussed at the stakeholders’ meeting.

Legislators will also take a look at language that was adopted in similar bills in Missouri and Texas, he said, adding that nine states plus the District of Columbia have passed legislation addressing the issue.

Matt Van Nest, co-owner of Brasserie V on Monroe Street, said he’s had trouble with Grubhub ordering his food, and more than half the time it was food the restaurant was no longer serving.

It’s infrequent, he said, and 90% of the time his employees have caught it and refused to make the food.

Van Nest said he’s had a good experience with EatStreet, the Madison-based food delivery company, and it’s the only delivery service he uses. He likes EatStreet because it has its own employees, instead of private contractors.

His restaurant doesn’t see a lot of delivery business, maybe two or three orders a night, and having EatStreet handle delivery is preferable to him coordinating that service and having to worry about insurance and liability.

“That’s not what our model is. We’re not a delivery place,” Van Nest said.

Hillmer said EatStreet is a valued partner to a lot of restaurants and not one of the big three: Uber Eats, Grubhub and DoorDash. “They are also at the table,” she said about EatStreet.

“A restaurant needs to be able to have control over their product and what’s happening with it and not have companies insert themselves into that relationship,” she said.

“We just want the restaurant to be, pun intended, in the driver’s seat to say who can and who cannot deliver their food,” Hillmer said.

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