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Posted on January 20, 2019

What is behind the high cost of delivery food?

It is no secret that the cost of food delivery can be staggeringly high. Yet consumers, trapped by the fast paced millennial lifestyle, which leaves little to no time for meal prep or cooking, often cave to the convenience and lure of food delivery. We were interested to find out more about the exact cost of food delivery and why it is so expensive. There’s a saying, “it costs what it costs,” but this wasn't enough for us so instead we took an in depth look at the costs and fees relating to food delivery. Keep reading to see what exactly your money goes to each time you use a food delivery service.

To start, we have to first name all the parties involved in the food delivery process. For clarification, in this article I refer to food delivery to mean third-party food delivery apps or services. NOT food delivery from places like Pizza Hut, Dominos, etc. So the first step in the process is the restaurant. The majority of the money you pay for food delivery goes to the restaurant because the food is the largest portion of the total cost. Next, there is the delivery service itself. This could be GrubHub, UberEats, Postmates, etc, depending on where you order from. These companies take money for the service they provide facilitating the transaction between the hungry consumer and the restaurant itself. Finally, the delivery man/woman. The food delivery services, much like Uber or Lyft, employ vast networks of independent contractors who pick up and deliver orders from restaurants and deliver them to consumers. This typically seamless process is completed using technology infrastructure set up by the food delivery company you are ordering from.

So these are the 3 main players who will be receiving a portion of the bill you pay when ordering food delivery. And when you order delivery food, the split ends up being something like this:

For a more detailed breakdown of the individual services, we have provided another infographic you can use to determine exactly where the money you spend on food delivery is going.

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