This month we’re keeping tabs on the Restaurant Delivery Service legal landscape and offering tips for sprucing up your operation for warmer weather.
Have you been reading the news? Some of our friends in the Midwest are experiencing legal changes that impact their RDS. The jury’s still out on whether other regions will follow suit, but we’re sharing a recap so you can keep tabs. And keep scrolling for my take on spring cleaning for your RDS.
Iowa passes a new bill placing restrictions on RDSs.
The Iowa House of Representatives recently passed a bill that puts restrictions on restaurant delivery services (RDSs) in the state. The bill raises some compelling questions about “delivery hygiene,” which we wrote about in a recent blog. But it covers a few other topics that are worth mentioning:
- If a delivery driver is caught sampling food from an order, the RDS has to pay a fine. Apparently, up to 25% of delivery drivers are guilty of this. (I’m sure this goes without saying, but make sure your drivers know that this is completely unacceptable!)
- RDSs can’t list restaurants on their websites without first establishing an agreement with the restaurant. Some of the big names in food delivery are guilty of this, and it has caused big problems for restaurants. Customers place an order via a big-name delivery app for a restaurant that doesn’t even offer delivery. Then, when the order never comes, the customer leaves a nasty review—and the restaurant has no idea what happened. (Again, this goes without saying, but don’t do this. You must establish a partnership and an agreement with a restaurant before listing them on your website.)
Next stop for the bill is the Iowa Senate. At this point, no other states appear to be actively pursuing similar laws. But we’ll keep you posted.
Illinois city says goodbye to restaurant delivery fee cap.
Before the COVID-19 pandemic, most RDSs charged restaurants a commission rate of 25-30%. Starting in 2020, a number of city and state governments imposed a copy of 15% to protect restaurant revenue. Many RDSs responded by charging the difference to the delivery customer as a surcharge. In our experience, delivery customers tend to be pretty price insensitive. So those few extra dollars didn’t seem to deter most people from ordering delivery anyway.
As of March 1, Evanston, Illinois is formally dropping the 15% limit. The city has issued an official statement acknowledging the fact that the cap was never meant to be permanent.
Evanston may be one of the first to bid farewell to the commission cap. Others are likely to follow suit. If you operate in a city or state that imposed a cap, watch the news. You may choose to adjust your pricing once those limits go away.
Spring cleaning for your RDS
The busy season for restaurant delivery tends to follow the academic calendar. Demand ramps up in September and tapers off in May and June.
With a quieter season on the horizon, now is a great time to do a little spring cleaning. Take a moment to check in with your drivers and see if any of their supplies need replacing. This might include:
- Hot bags and cold bags. Old ones can lose their insulation power.
- Nametags, lanyards, shirts, and other uniform pieces.
- Car mounts for cell phones. These handy gadgets make the delivery process much safer for your drivers.
- Car marketing items, such as door magnets, illuminated car toppers, and light-up windshield placards. Winter can be rough on these things, so be sure to replace them if they’re looking a little faded. Also, those illuminated signs can protect your drivers from tickets. Officials are less likely to give out parking tickets to cars that are clearly delivery vehicles.
No matter what the weather or the restaurant delivery service legal climate is doing in your area, be mindful of this next season.
Spring is full of opportunities, and with the right mindset, your RDS can bloom too.
