Delivery aggregators: the deal, read properly

Signing up to a delivery platform can feel like switching on a new stream of guests. Within days, orders arrive from people who have never heard of the venue, delivered by drivers the venue does not employ, paid through an app the venue does not run. For many venues, that reach is genuinely valuable.

It comes at a price, and the price is set out in a contract that few operators read closely. Commission is only the most visible part. Marketing fees, refund rules, payout terms, price clauses, exclusivity and the question of who owns the guest all shape what an order is really worth. This guide reads the deal properly: what delivery aggregators give and take, the clauses worth negotiating, how to cost an aggregator order, and the volume at which running your own delivery starts to add up. Every figure in it is an example, and every contract is different, so read your own.

Delivery aggregators, the platforms that list many venues in one app and handle ordering, payment and often delivery, give a venue several things it would struggle to build alone.

The first is reach. A platform puts the venue in front of guests who are already looking for food to order, many of whom would never have found it otherwise. The second is logistics: drivers, routing and tracking, so the venue does not need to employ or insure its own. The third is the ordering and payment technology itself, from the app to the payments. The fourth is trust: guests who already use the platform are comfortable ordering from a venue they do not know.

For a venue starting delivery, or one in an area where guests rely on the apps, those benefits can be worth a great deal. The question is what they cost, and whether the cost is fair for what the venue gets.

In return, aggregators take a share of every order, usually as a commission on its value, and often other fees on top. They also take a measure of control: over how the venue appears, how its prices compare, how refunds are handled and, in most cases, over the relationship with the guest.

That last point is easy to overlook. A guest who orders through a platform is, in practice, the platform's customer. The venue cooks the food, but the platform holds the guest's details, shapes their experience and decides whether to show them the venue again next time. Many venues find that their delivery guests never become their own guests.

None of this makes aggregators a bad deal. It makes them a deal with several prices, and each one should be understood before signing.

Aggregator commission is usually a percentage of the order value, and the percentage is the number everyone asks about. But the base it is charged on matters as much as the rate. Is it charged on the order including tax or excluding it? Does it include the delivery fee the guest pays, or tips? Is it charged before or after any discount the venue funded?

Rates also vary by service. Many platforms charge one rate when they provide the delivery and a lower one when the venue delivers its own orders or the guest collects. Some offer tiers, with a higher rate buying better placement in the app.

Ask for the commission in writing, with an example order worked through: the price the guest pays, every deduction and the amount the venue receives. Our guide to aggregator commission and the real cost of an order covers the arithmetic in detail.

Commission is rarely the only charge. Read the contract for the others:

Each fee may be small on its own. Together, they can add several percentage points to the real cost of an order. Ask for a full list of every fee that could apply, and how each is calculated.

When something goes wrong with a delivery order, such as a missing item, a cold dish or a late arrival, the guest complains to the platform, and the platform often refunds them. The question is who pays for the refund.

Contracts differ. Some charge the venue for refunds the platform decides were the venue's fault, such as a missing item. Some charge the venue for problems caused by the delivery itself, such as cold food after a long journey. Some give the venue a way to dispute a refund, others do not.

Read this section carefully, and keep records of every order: what was sent, when it left and how it was packed. A venue that can show an order was complete and on time is in a much better position to dispute a refund. Careful packing and a delivery menu built for travel reduce complaints in the first place; our guide to a delivery menu that is not your dining room menu covers how.

Platforms sell visibility. A venue can pay, through a higher commission or a separate fee, to appear higher in search results, in featured lists or in promotional emails. Platforms also invite venues to run offers, such as free delivery or a discount, often funded partly or entirely by the venue.

These can work, especially for a new venue building a following on the platform. But they can also become a habit that eats the margin: a venue that always runs a discount teaches guests to wait for it, and a venue that stops paying for visibility may find its orders fall sharply.

Treat platform marketing like any other marketing. Set a budget, measure what each promotion brings in after its cost, and stop what does not pay. Ask how the platform measures results, and whether you can see the figures yourself.

Some contracts include clauses about the prices a venue can charge. A price parity clause, for example, may require the venue's prices on the platform to be no higher than its prices elsewhere, including on its own website. Such clauses are restricted or not allowed in some places, so check what applies where you trade and what your contract says.

Price clauses matter because delivery pricing is one of the main ways venues cover the cost of commission. A venue that cannot charge more on the platform than in the dining room may lose money on every delivery order. Our guide to delivery pricing, and why the menu price must differ covers that decision.

Check, too, how much control the venue has over its menu on the platform: whether it can change dishes, prices and photographs itself and immediately, or must ask the platform to do it.

Some platforms offer a lower commission in exchange for exclusivity: the venue agrees not to list on competing platforms. That can be a good deal if one platform dominates the venue's area, and a poor one if guests are spread across several.

Read the contract length and notice period too. A long contract with a long notice period makes it hard to leave if the deal stops working. Check what happens to any equipment, promotional commitments or outstanding fees if the venue leaves.

Where exclusivity is offered, ask what happens if the platform's performance falls short. A venue locked into one platform has little leverage if its orders decline.

Platforms collect payment from guests and pay the venue later, after deducting their commission and fees. How often they pay, and how clearly they show the deductions, matters for cash flow.

Check the payout schedule, whether weekly, fortnightly or monthly, and how long after an order the money arrives. Check what the statement shows: every order, every deduction and every refund, in a form you can reconcile against your own records.

Reconcile the statements regularly. Errors happen: orders missing from a statement, deductions that do not match the contract, refunds charged twice. A venue that checks its statements catches them; one that does not, pays for them.

For many venues, the most important part of the deal is the one with no price attached: who owns the relationship with the guest. In most cases, the platform holds the guest's details, and the venue receives little more than a first name and an order.

That means delivery guests are hard to turn into regulars. The venue cannot email them, cannot recognise them when they visit in person and cannot learn much about what they like. The platform, meanwhile, can show them a competitor next time.

Ask what data the venue receives, and what it is allowed to do with it. Then think about how to invite delivery guests to become your own guests, within the platform's rules: a card in the bag inviting them to book a table or sign up for news, for example. Guests who choose to hear from you directly, with their consent, are worth far more over time than guests who only ever meet you through an app.

Several operational settings in the contract affect both orders and costs. The delivery radius decides how far the venue's food travels, which affects both reach and how food arrives. The minimum order value decides whether small orders are worth sending. The hours decide when the venue appears in the app.

Set these to protect the food and the margin, not just to maximise orders. A radius so wide that food travels forty minutes produces cold dishes and complaints. A minimum order so low that packaging and commission exceed the margin produces orders that lose money. Hours that stretch past the time the kitchen can cope produce slow, poor orders.

Check whether you can change these settings yourself, and how quickly.

Not every term is negotiable, especially for a small venue. But many are, particularly for venues with a strong local following or several sites. The clauses most worth raising are:

Ask for any changes in writing. A promise made by a sales representative and not written into the contract is easy to lose.

To see what an aggregator order is really worth, work through an example. Take an order of 30, at an example commission of 30%, with an example packaging cost of 1.50 and food costs of 9.

The platform takes 9 in commission, leaving 21. Packaging takes 1.50, leaving 19.50. Food takes 9, leaving 10.50 to cover labour, overheads and profit. The same meal eaten in the dining room, at the same price and without commission or packaging, would leave 21 before labour and overheads.

That gap is the real cost of the platform, and it is why many venues price delivery differently, choose delivery dishes for their margin, or both. Add any promotion fees, payment fees and refunds to see the full picture.

The alternative to an aggregator's drivers is own delivery: employing or contracting drivers, insuring them and their vehicles, and taking orders through the venue's own website, phone or an ordering service. The venue keeps the guest relationship and avoids the commission on delivery, but takes on the costs and the work.

Those costs are mostly fixed. Drivers must be paid whether orders come or not, vehicles and insurance cost the same in a quiet week as a busy one, and someone has to manage it all. Own delivery also needs a way for guests to find and order from the venue, which the aggregator provided.

Many venues use both: an aggregator for reach, and their own channel for regulars who are happy to order directly. A lower commission for orders the venue delivers itself, where a platform offers one, can make a mix of the two attractive.

The choice between an aggregator's delivery and your own comes down to volume. At low volumes, the aggregator is usually cheaper, because the venue pays only when an order arrives. At high volumes, own delivery can become cheaper, because its fixed costs are spread across many orders while the commission grows with every one.

Take an example. Own delivery might cost 2,500 a month in fixed costs, plus 3 per order in fuel and other variable costs. An aggregator might take 9 per order in commission on an average order of 30. Each order delivered by the venue instead of the platform saves 9 minus 3, which is 6. The fixed costs are covered once the venue delivers about 2,500 divided by 6, roughly 420 orders a month, and every order beyond that is cheaper than the platform.

Your own figures will differ, but the shape of the sum is the same. Work it out with real costs before deciding, and remember that the aggregator's reach is part of what you would be giving up.

For most venues, the question is not whether to use aggregators but how to use them well. A few habits make a large difference.

Build a delivery menu for the box, not the dining room. Price it with commission in view. Keep the menu, photographs and hours up to date. Pack carefully, with a checklist. Respond to reviews. Watch the venue's rating on the platform, because it decides how often the app shows the venue to new guests. And invite delivery guests, within the rules, to become your own guests.

Our guide to online ordering: the channels and what each costs covers how aggregators compare with the other ways guests can order, and Wikipedia's overview of online food ordering gives the wider background.

Review the aggregator deal at least once a year, and whenever its terms change. Look at what the platform has cost in total, every fee and refund included, against the orders and the margin it has brought. Compare that with what own delivery, or a different platform, would cost at the same volume.

Look at the trend as well as the total. Are orders growing or falling? Is the commission rising through promotions and fees? Are refunds increasing? Are delivery guests becoming regulars, or staying platform customers?

Use the review to renegotiate. A venue that knows exactly what the platform costs and earns, and has considered the alternatives, is in a far stronger position than one that simply renews.

An invented pizzeria joins a delivery platform at an example commission of 30%, with a device fee and an optional promotion programme. After six months, it takes about 500 delivery orders a month, at an average of 28, and its delivery prices are the same as in the restaurant.

Working through its statements, the pizzeria finds that commission, promotion fees and refunds together take about 36% of delivery sales, and that the average order leaves very little after food and packaging. It raises delivery prices modestly on the platform, after checking its contract allows it, trims the delivery menu to the dishes that travel and earn best, and stops a promotion that brought orders at a loss.

It also works through the own-delivery sum. With its volume, two part-time drivers and the platform's lower commission for venue-delivered orders would save money on most orders, so it begins delivering local orders itself while keeping the platform for reach. A card in every bag invites guests to order directly next time.

servearound does not take delivery or takeaway orders and does not connect to delivery platforms today, so aggregator orders, payouts and statements live with the platform. What servearound holds is the side of the business that turns guests into your own: the booking page, guest profiles with visit history and notes, marketing consent given by the guest, and email campaigns to the guests who opted in.

That is where an invitation in a delivery bag can lead: a guest who books a table on your booking page, or signs up for news, becomes a guest the venue knows directly. The menu report shows how dishes sell in the venue, which helps choose the dishes worth sending out. See the guests module and Campaigns.

Platforms that list many venues in one app and handle ordering, payment and often delivery, in return for a commission and other fees.

It varies by platform, market and service, and is often lower when the venue delivers its own orders. Check the rate and the base it is charged on in your contract.

Often device or tablet fees, onboarding, promotion and marketing fees, payment fees and charges for refunds.

It depends on the contract. Some charge the venue for refunds the platform attributes to it; check how refunds are decided and whether they can be disputed.

A clause requiring platform prices to be no higher than prices elsewhere. Such clauses are restricted in some places; check your contract and local rules.

Usually the platform. The venue often receives little guest data, which makes delivery guests hard to turn into regulars.

When order volume is high enough that the commission saved on each order covers the fixed costs of drivers, vehicles and insurance.

The commission and its base, fees, refund rules, any parity or exclusivity clause, contract length, payouts, guest data and control over the menu and settings.

At least once a year and whenever the terms change, comparing the full cost with what the platform brings in and with the alternatives.

Delivery aggregators give a venue reach, logistics, technology and trust, and take a commission, a set of fees and a measure of control, including, usually, the relationship with the guest. Read the commission and the base it is charged on, list every other fee, understand who pays for refunds, and check any price parity, exclusivity and notice clauses before signing.

Cost an aggregator order fully against the same meal in the dining room, price and build the delivery menu with that cost in view, and reconcile every statement. Work out the volume at which own delivery would be cheaper, invite delivery guests to become your own within the rules, and review the deal every year, because a venue that knows its numbers negotiates far better than one that simply renews.