Restaurants May Finally Get Relief From Apps’ Auto-Signups

Photo: Amir Hamja / Bloomberg via Getty Images

Before the pandemic, Michael Fuquay’s restaurant, the Jackson Heights diner in Queensboro, barely used delivery apps. The experience there is a big part of the draw, so his staff only sent a few orders a day, and he didn’t mind partnering with companies like Seamless, he said, despite the 30% they would charge fees. But once the city was locked down, Fuquay did what few restaurateurs were willing to do: cut ties with apps. Instead, Fuquay reached out to customers directly, put flyers in people’s take-out orders asking them not to use the apps, and retrained service staff so they could do the delivery work.

Still, Grubhub orders kept coming in. The post comrades too. Fuquay has not worked with them officially; they simply put his restaurant on the site, picked up the orders and delivered them. Not only did they always charge fees to his clients; they used old menus, promising customers dishes they hadn’t prepared in years, like duck breast in mole sauce. This has led to confused and upset customers, negative reviews and general frustration that the tech giants are squeezing out of his business and leaving him little to show. “It’s distorting my business to the public,” Fuquay said. “What I’m losing is the ability to control the transaction with the customer, the ability to market my own current menu and my own current prices, and to resolve any issues that arise.” He tried to call them over and over again, but the response, he said, was the same: “Crickets.”

Now New York is on the verge of allowing restaurants like Queensboro to have more control over their own deliveries. Mark Gjonaj, a member of the Bronx City Council and chairman of the Small Business Committee, is expected to introduce a new bill on Thursday that would make it illegal for third-party delivery companies to add restaurants to their apps without explicit permission – and would be fine. businesses up to $ 1,000 per day, per restaurant, for violating these conditions, according to a version of the bill obtained by Curbed. “Often times, in cases where a restaurant doesn’t want to be included in a third market, it’s because it loses control over the quality of the food and gives up having a direct relationship with its own customers. – winning situation, ”Gjonaj told Curbed. “Now more than ever, local restaurants should be able to take control of their business and how it works. If they want to sign up for a delivery service, so much the better. If they don’t, they shouldn’t have to crawl past tech companies and hope to be taken off a platform that could harm their business.

The law, if passed, would potentially double the penalties imposed by a state bill Staten Island State Senator Diane Savino, who bans the practice statewide. The state bill, which passed both legislative chambers in May and will be submitted to the governor for review in the coming weeks, also allows restaurants to take legal action against third-party delivery companies for having them. added. And it comes as city lawmakers seek to redouble their efforts to curb middleman apps, just as restaurants that have survived the pandemic can return to full capacity. “With the difficulties restaurants have faced over the past year, this legislation will help ensure that they will not be operated,” said Senator Savino. The surreptitious addition of restaurants was a delivery practice for years. DoorDash and Postmates, now owned by Uber, were examples of the practice and used it to fuel their growth in Silicon Valley. Seamless, Grubhub’s parent company, coming soon monitoring suit, adding hundreds of thousands of restaurants in a race for market domination. Although the growth has been undeniable – especially during the pandemic – it is still a unprofitable industry.

By the time the pandemic began in March 2020, tension had been mounting for years between New York’s restaurant industry and these tech delivery companies. Seamless and DoorDash, they complained, have charged extremely high fees, discouraged dining inside – where restaurateurs typically make more per meal – and have done so. After confusing than before for some customers. In May, just weeks after the lockdown began, city council passed a series of emergency laws temporarily capping fees and limiting their ability to charge commissions for orders placed through their phone systems – a situation that could potentially Cost restaurants extra thousands of dollars per month. These invoices expire in August, and the Gjonaj office plans to hold a hearing later this month to discuss their sustainability as well as the increased phone ordering fees. transparent. “My colleagues and I are currently considering whether to temporarily extend, make permanent or let the laws expire,” Gjonaj said.

The response from delivery companies has been mixed. Uber declined to comment. DoorDash already had ad in November that he was ending the practice of adding restaurants to the platform without their explicit permission, although he kept the ones he had already listed, according to a person familiar with the company. “We are proud that the odds of staying in business during the pandemic are eight times better for restaurants on DoorDash, and we applaud efforts to support local merchants and ensure they are heard,” a door said. word of DoorDash.

Grubhub, which only started adding these so-called non-partner restaurants in 2019, did not directly answer questions about the new bills but said it supports local restaurants that want to go out. “We are developing tools that make it easier for restaurants to claim their menus or request to be removed from our platform, and if a restaurant does not wish to be included on Grubhub, they can contact us at [email protected]” , said a spokesperson for the company.

New York has generally been among the most aggressive states in pushing back delivery companies. As the restaurant industry has been hit by the pandemic – Andrew Rigie, executive director of the New York City Hospitality Alliance, told Curbed that there are still around 130,000 fewer jobs in the city – lawmakers have been more receptive to recovering them. “We need to have penalties for non-compliance,” Rigie said. “A lot of them are billion dollar companies. We have seen that they are ready to exploit the local restaurants, they try to circumvent the laws in a creative way so as not to affect them, and even in cases where the laws are in force, they willfully break them. Fuquay said that while Queensboro was able to rally customers to support it, not all restaurants would be able to. “Some restaurants feel trapped, and these restaurants are generally the least well-resourced,” he said. “We have connected the dots in a way that a lot of restaurants don’t have the resources to do, and they are operated by these companies.”