Posted on 06/26/2024 10:50:19 AM PDT by SeekAndFind
Drivers are not helped by wage mandates is Seattle and New York. And customers complain higher prices and cold food.
It’s a perfect trifecta of complaints.
Neither drivers nor customers are happy with misguided politicians attempting to help driver get better pay.
It’s losses all around as Delivery Drivers Got Higher Wages. Now They’re Getting Fewer Orders.
The delivery companies—whose businesses are built on gig workers they don’t employ full- time—say they can only afford to pay so many workers under the two cities’ latest pay standards. The cities want the companies to pay couriers a minimum hourly wage based on the time they spend delivering orders and reward the most efficient workers. New York City now requires that the companies pay couriers at least $19.56 per hour before tips, up from an average of $5.39 per hour before its rules went into effect in December.
Uber Eats’ UBER orders in Seattle fell 45% last quarter from the same period a year earlier after the company imposed a $4.99 fee on each order to cover the city’s new pay requirements. Demand also cooled in New York City, Uber and DoorDash DASH.
Consumers already pay the apps a service fee and delivery fee, in addition to tipping workers. For some, the latest app fees were the last straw.
Seattle-based researcher Ro Singh was hooked on ordering in several times a week until the city adopted its pay measure in January. App prices “became absolutely nuts,” he said, after adding varying delivery fees in addition to tipping. He started picking up the food himself.
“It’s like double the price to order a $20 burrito now” compared with the pickup price, he said. “This is insane.”
Uber Chief Executive Dara Khosrowshahi said the company has had to cut 25% of the delivery drivers who previously worked for the app in New York City. “So far, regulation has definitely hurt the people that it’s supposed to protect,” Khosrowshahi said last month on a call with analysts.
Shuai Zhang, the owner of Poprice, an Asian street-food restaurant in New York City, says his delivery sales are a third of what they were before the changes. Drivers who once picked up from his restaurant are now asking him for jobs. He hired two of them.
Fewer workers delivering for the apps means it takes longer to pick up orders. Customers are complaining about deliveries arriving cold and soggy, Zhang said. To make up for lost sales, he has started working as a restaurant consultant.
Seattle driver Gary Lardizabal said he makes less money now despite working more hours. Breakfast and afternoon-snack delivery orders have disappeared. Smaller deliveries don’t make sense because of the new $4.99 fee, he said.
Drivers because they are making less money
Restaurants because they are losing business
Customers because of slower deliveries, cold food, and higher prices
The city loses too. Seattle collects a sales tax of 3.85 percent.
New York City says the plan is working. The only thing I can come up with is reduced traffic.
Seattle City Council President Sara Nelson is pushing to reverse the new earnings standard after complaints from drivers, restaurants and consumers, though she wants to ensure that workers still make the city’s minimum hourly wage before tips.
What a hoot.
Not having learned anything from this, Nelson still wants to mandate minimum wages. I wonder what miserable failure she will concoct next.
Meanwhile, please note A $5 Meal Deal at McDonalds, Price Wars Also at Starbucks, Walmart, Target
Still more signs of consumer exhaustion are evident in tactics by McDonalds, Starbucks, and other chains’ attempts to woo back customers who said no more to rising prices.
In case you missed it, please see my June 20 post, Breadsticks at Olive Garden Highlight Financial Strain on America’s Middle Class
Traffic at Olive Garden is up 3.9 percent but but same store sales are down 1.5 percent. Are people filling up on unlimited breadsticks? Drinking less wine?
Repeating comments I made in the McDonalds post, all of the articles in this post have one thing in common. They are all about discretionary spending.
Consumers are tapped out and that is the first, if not only thing consumers can cut back on.
“The nine most terrifying words in the English language are: I’m from the Government, and I’m here to help. “
-Ronald Regan
Must not be familiar with Seattle traffic..
Politicians lookin’ out for da little people. ROTFLMAO!
I think “Economic” Nobel Prize winners should have to pay a “fee” of $499.99 to have Uber Bites to deliver their pizza.
The problem with that scheme is that customers who tip generously in cash (that the driver then doesn’t declare) appear to be just the same as customers who tip poorly.
I do, actually.
...Always in the way. A good whack into their supercarts with your cart always gets their attention.
It's great sport.
The “invisible hand” as described by Adam Smith at work.
The government can make all the laws and regulations they want but the market place will decide what works and what does not work.
Food delivery is not normally a necessity. It is a luxury item where the consumer decides if their time is more valuable then the cost of delivery.
Some think it is but as the cost goes up the value to the customer goes down.
Governments can regulate the charge but they can not force people to buy.
This is predictable as the sun rising in the east.
They are concerned with the reality of power.
Whatever keeps them in power is what is defined as "the good".
In the philosophy they espouse, everyone having an equal share of $10 is morally superior to a miniumum share of $10, with the average being $20 and the maximum unlimited. They view such an arrangement as fundamentally immoral, even though the worst off do as well and the average does twice as well.
“ What’s in a $20 burrito?”
Six bucks of stuff and 14 bucks of fees.
I agree!
Every union contract has a clause stating that the value of the contracted wages goes up in proportion to the minimum wage. Raising the wage is pandering to the unions. Is now, and always has been.
As an independent contractor in Pennsylvania, the state makes the company I work for pay time and a half for anything over 40hrs/week. I would gladly work for my regular rate, but because of this law, I never get overtime when working in Pa. Yea, liberals suck.
“Get off your butt and go to the cafe to pick it up yourself!!”
In parts of Seattle you might have to step over homeless people and needles to visit some cafes.
;-)
Deliveries are only desirable if they are considered a reasonable alternative to going to the store and picking the food up. For $4.99, I’d say that a lot of people feel like it’s a better choice to just go get the food. Or cook something at home.
Sometimes yes, but when you have to stay someplace being able to have food delivered is quite the blessing.
I have had food delivered when I was sitting with people who are ill, when I have had to work late, when I was waiting our turn before a judge and so forth. Leaving in all those cases was not an option.
… yet.
obama tried once.
What some sleazy customers do is enter a higher projected tip when placing the order, which induces drivers to accept their order, but then change it after delivery to zero tip. This is a common practices among certain ethnicities....
This is a big deal with food deliveries because the tip is often up to 50% of the order, sometimes more. That commonly happens when people order a small amount of food. So essentially, they're deliberately lying to drivers to get them to pick up an order that otherwise isn't worth their time.
Obviously, that's a different issue if the driver screws something up. But customers who always bait and switch on tips should have that exposed.
The reason that isn't done is 1) bad tipping has some "demographic" components, and the companies don't want to be accused of discrimination, and 2) the driving company gets their fee regardless of whether the drivers get tipped. I road along with my son when he was doing this one summer, and you can see the trends fast. But knowing that your customer has been highly rated by other drivers would be huge.
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