Reforming The Unfair Third-Party Restaurant Delivery Industry
Third-party delivery companies have a long history of using their wealth and monopolistic power to exploit local restaurants. The NYC Hospitality Alliance has been advocating to enact legislation to rein in these companies and create a fair and equitable delivery marketplace for restaurants. To do so, laws must be established to permanently cap third-party fees at 5% for listing and marketing restaurants on their sites and 10% for conducting the physical delivery of food and beverage – no additional fees should be permitted to restaurants as it would provide a loophole for these tech giants to undermine such a law. The law must also guarantee that restaurants are provided and retain ownership of their customers’ information/data processed through third-party delivery companies (and reservation sites too), and ensure that such sites are prohibited from and subject to significant penalties for charging fees for customer phone calls that do not result in an order being placed, which is a longstanding practice by companies such as Grubhub and Seamless. Third-party delivery companies must also be prohibited from listing restaurants on their sites without express permission, and certain advertising practices intended to steal restaurants’ customers need to be restricted.