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Greek Restaurants Pay Steep 30% Commission to Food Delivery Apps

Food delivery
Restaurant owners are forced to pay unreasonable commission fees to delivery platforms. Credit: Julia Justo / Wikimedia Commons

The commission fees paid by Greek restaurateurs to electronic delivery platforms are among the steepest in Europe. It’s a well kept secret in the Greek restaurant business, and it severely impacts their income.

By offering more than 30% of their profits on every dish delivered through an online delivery platform, Greek restaurants are all but making the platforms their unwitting business partners.

According to restaurant owners, the basic commission fee charged by the platforms is at 27% the price of any entree. Add to that the VAT charge of 24% on that same 27%, and you have a total fee of around, or over, 30%. And that is just for the basic use of the online delivery service.

If the restaurant has no delivery fleet of its own, the platform offers its vehicles at an extra charge. Commission fees are not the same in every area. The platforms charge goes up if the area serviced has a higher standard of living.

In Kifissia, for example, the charges are higher than in Peristeri. Kifissia is a northern suburb of Athens, where real estate prices are among the highest in the country. Peristeri, on the other hand, located in the western part of Athens, has more inexpensive real estate.

Delivery Apps commission fees unbearable in Greece

But the commission fee is usually much higher than the 30% demanded by the platform for delivering the restaurant’s dishes. There is also an “extra promotion” fee, which ensures that the restaurant appears in the platform’s top spots.

Refuse to pay that, and your restaurant will be at bottom of the user’s list when they open the online platform to order. The commission percentage fee is determined by both the area you serve and how high up the list your business will appear.

It’s like Google results — but regulated, instead of being determined by bot algorithms. The “extra promotion” costs usually rise even more, if the restaurant wants to include premium placement, discount offers, recommended dishes and so on.

The two most popular e-delivery platforms in Greece are efood and Wolt. Due to the pandemic lockdown restrictions, the former’s profits were almost €23.5 million higher in 2020 than in 2019.

This growth is attributed to the increase in take-out orders. As a result, efood’s commission income was up by €13.4 million in 2020, rising to €46,143 million. Add to that an extra €5.3 million for the “extra promotion” fees and you realize why efood ended up being the ultimate success story of 2020.

Liqueur stores, super markets, bakeries, butcheries deliveries

Even before the pandemic, e-delivery platforms had enjoyed a great deal of succes. With lockdown restrictions, they have upped their game, incorporating liquor store, super-market, butchery, fishery and bakery delivery services as well.

Restaurant owners now find themselves in an impossible situation. They need the e-delivery platforms to grow their businesses, but they feel trapped by the huge cost of doing business this way. Most are furious with the platforms, but stay silent in fear they will lose their traffic.

Despite its meteoric growth, efood found itself in the middle of a labor dispute controversy last month. After sending out a text message to 115 of their employees urging them to become freelancers, social media users were outraged.

In less than a day, efood’s online reviews dropped from 4.5 stars to 1. Many users deleted the application from their devices and the company was forced to take back their text message. They apologized, saying it was a “communication error” on their part.

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