food delivery toronto

The tough economics behind restaurant delivery apps in Toronto

What do you want for dinner? If you don't feel like cooking, you can get a meal from nearly any restaurant in the city delivered straight to your door.

“All of sudden everything is deliverable,” says Mark Kupfert, who co-owns popular vegan spot Kupfert & Kim. “Whereas before you’d think I want food delivery and you were limited to pizza.”

His restaurant has partnered with numerous delivery services, including foodora (formerly Hurrier) and UberEATS – the two most predominant players in Toronto’s food delivery market right now.

UberEATS has about 1,000 restaurant partners in the GTA and foodora has 550. And while these companies give local restaurants access to a broad range of customers, they also take a sizeable chunk off of each order.

“The argument is that these are sales we would have not normally achieved and so it’s worth paying these extra premiums,” says Kupfert about why restaurants tend to sign up with these companies.

Linda Dang, who runs North Poké in Kensington Market, says she signed up for UberEATS and foodora two weeks after opening her restaurant.

“We wanted the extra exposure to new customers seeing that we were a very small start up,” she says. “We definitely don't have the same marketing budget as other restaurants, so this was an easier way to gain new customers.”

On average, she gets about 20 to 30 orders through these services per day, but admits the commission foodora and UberEats takes can get expensive.

“We only make money when we send a restaurant an order,” says foodora’s general manager in Toronto David Albert. He confirms foodora takes roughly 30 per cent off of each order (along with charging a $4.50 delivery fee on the customer end).

With UberEATS, the commission ranges from 25 to 35 per cent, plus customers pay $4.99 for delivery. Customers can also get dinged with $7.49 busy area fee, which general manager Dan Park describes as sort of a surge charge.

On both platforms, this commission rate is flexible. To respond, some restaurants raise their prices—Kupfert and Kim increased its prices by about $1 per item and so did Nom Nom Nom Crepes.

This crepe poutine place, located in Market 707, relies heavily on delivery services in the winter months. “It really helped us, especially since we’re an outdoor market,” says owner Marc Perraut.

Perraut signed up with all of the major delivery players and has a wall of technology filled with iPads from each platform.

And although Perraut admits the commission fees are going up, for him, it’s worth it in the winter, even if it can get a little bit frustrating once he’s busier in the summertime. Ultimately, however, it just makes more sense to stay online for the extra business.

Lead photo by

@tylersjourney


Latest Videos



Latest Videos


Join the conversation Load comments

Latest in Eat & Drink

Toronto man's side hustle making calzones leads to new restaurant gig

Toronto bakery known for its croissants opening second location

There's a food festival in Toronto for a good cause next month

Ontario restaurant has people obsessing over its fried chicken

Toronto has a new street food market in a surprising location

The history of what was once Toronto's most luxurious restaurant

Thousands of people want to boycott Loblaws stores 'indefinitely'

One of the most anticipated Toronto restaurants of the year is now open