A Dundee takeaway boss has hit out at Just Eat for a hike in service fees, saying the delivery app has take-away owners “over a barrel”.
Amar Salimi, owner of Azaad in Invergowrie, just outside Dundee, and Wingville on the city’s Perth Road, has written to customers telling them of new commission charges implemented by the third party delivery company.
People ordering through the app now face paying as much as £2.50 in fees to Just Eat, compared to a previous 50p flat rate.
The business owner himself is also paying up to 18% on every order.
Just Eat informed Mr Salimi they were trialling a new 5% charge for Azaad orders, with a minimum fee of 99p each time.
Recently-opened Wingville is not available through the app.
The app allows users to choose from different businesses and pay for their order digitally.
Companies like Just Eat, Deliveroo and Uber Eats then take a commission from the restaurant, as well as a service charge from the customer.
And when location was once king for the small takeaway business, prominence on the “online High Street” is now more important, Mr Salimi explained.
Dundee takeaway’s Just Eat warning
He told The Courier the company’s practices are leaving independent and local businesses in a difficult situation.
“We started using Just Eat around 2010, and when we opened our food business it was all about location,” he said.
“Whether that’s on a busy street, in a housing estate or shopping precinct, it was all about passing trade and locals coming in.
“But over time it has become more and more about your ‘online’ location.
“You want to be on the ‘online high street’, which is for the most part Just Eat.
“And because they have the largest customer base, you should get more orders.
“The issue with that is they charge us between 16-18% commission, and there was a 50p flat charge for customers. And on a £10 order, say, they would get around £1.80 from me and 50p from a customer.
“But now that is going to be about £2.50 from the customer alone.
“And when it started, it was around an 8% charge for us, which was affordable.
“These companies are market disrupters, they don’t improve the food trade, they have just ‘cuckooed’ in. But the food business cannot survive currently without them. And they know that. They have us over a barrel.
“Profit margins for takeaways and restaurants are not what they used to be.”
Amar said he still uses Just Eat for Azaad, to attract customers to his business.
But they are encouraged to order through his website or in person. And he has not signed his new venture, WingVille on Perth Road, onto the app.
“I know if I bring Just Eat on, turnover will initially go up. But I don’t want to be a ‘busy fool’ producing all that food and not making any money.
“We can give our customers a much better service when they come to us direct. It means we can deal with any issues ourselves too.”
A spokesperson for Just Eat said: “To ensure we can continue to deliver the best possible experience on our app, all Just Eat orders include a service charge.
“We are trialling variations of this charge when processing orders for partners who wish to conduct their own deliveries.
“In this trial, the service fee is 5% of the total order cost, starting at 99p.
“The upper limit of £2.49 would only apply to larger orders of £50 or more.
“We work hard to only change our fees when absolutely necessary and we are confident Just Eat remains very competitive”
Conversation