NDP calls for cap on delivery fees charged by third-party platforms

The provincial NDP wants to help restaurants it says “feel captive” to high delivery fees.

Jobs and the Economy Critic Aleana Young is calling on the Scott Moe government to put a 15 per cent cap on delivery fees charged by third-party platforms.

“I love to support local and I use these apps but I hear from business owners throughout the province that these fees — which are as we know 25 to 30 per cent — take up what are razor-thin margins at the best of times. I think this is a pretty simple, common sense way to help out a struggling industry,” said Young.

Young said the move would compensate restaurants that are already hit hard by capacity limits during the COVID-19 pandemic and help save many from closing their doors for good.

Young explained she’s not reinventing the wheel and similar caps on delivery fees have already been introduced in other provinces like Ontario and B.C.

“This seems to be the agreement in terms of what needs to be in place to help this sector weather through,” said Young.

The province has introduced pandemic relief measures for businesses including the Strong Recovery Adaptation Rebate (SRAR), which provides a rebate of 50 per cent up to a maximum of $5,000 for a $10,000 expenditure.

Young, a small business owner herself, said while that may sound like a lot of money to an individual, it doesn’t go very far for a business.

Restaurants Canada chimes in

Mark von Schellwitz, Restaurants Canada’s vice-president for Western Canada, also feels delivery fees are killing local restaurants.

He joins Young and others in calling for a cap on third-party platforms. Von Schellwitz says the fees in place are putting restaurant owners in a tough spot.

“These third-party delivery fees are eating up 25 to 30 per cent of a sale. It doesn’t leave any money left at the end of the day for the restaurant owners,” he said. “It’s certainly a problem.

“Also, with a greater focus on delivery, you’re not employing as many staff as you would have in previous years, meaning there are fewer jobs.

“It’s really difficult for a restaurant to break even, never mind making a profit.”

More restaurants throughout the province are prioritizing delivery as a way to get customers ordering from them and supporting their business.

With the increase in businesses taking that route, von Schellwitz hopes third-party delivery services will become better partners for restaurants.

“There were a lot of people before COVID that weren’t in that delivery space at all and now it’s certainly becoming a much more important component of every operator’s sales mix,” he said. “I think this is going to be one of the things that stays with us after COVID is done.”

— With files from 980 CJME’s Logan Stein and Greg Morgan