Council reviewing plan to cap third-party food delivery fees at 15%

A bill before Philadelphia City Council would cap meal delivery fees charged by third-party providers at 15%.

A food delivery courier passes an outdoor dining room in Philly's Rittenhouse neighborhood (Ashta Kunda/Billy Penn)

A food delivery courier passes an outdoor dining room in Philly's Rittenhouse neighborhood (Ashta Kunda/Billy Penn)

A member of Philadelphia City Council wants to put a permanent cap on third-party restaurant delivery changes. Councilmember Cherelle Parker said some third-party delivery companies want to charge up to 40% of the cost of food for delivery and that’s just unfair.

“We’re not going to allow these third party delivery firms to gouge our restaurant industry,” said Parker. “They are the heartbeat of our neighborhoods. We are trying to keep our neighborhood commercial corridors thriving.”

Parker said the bill is building on a collaborative effort with the Pennsylvania Restaurant and Lodging Association that started earlier in the pandemic and temporarily capped the fees. “As the pandemic set in in 2020, those fees from third-party food delivery apps were high. Almost 35%-40% percent of the total bill, doing what? Almost taking away a restaurant’s entire margin.”

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“We don’t want the residents in the city of Philadelphia who are trying to patronize our restaurants, nor do we want our industry in and of itself, to have the third-party delivery fees place additional stress on small business owners and operators or force them to have them increase the cost of their food,” said Parker. “We’re just not going to allow that to happen.”

She said restaurants in the city were decimated when COVID-19 caused shutdowns in the city, and they continue to face new challenges on a daily basis, including staffing shortages and supply chain issues. “I want our restaurants to be able to focus on running a successful restaurant, providing access to quality food for Philadelphians, and I don’t want either being gouged by a third-party delivery constituency,” Parker said.

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The Councilmember believes keeping the take-out fees low is a good way to keep restaurants operational during the pandemic, and capping them will maintain some consistency after the health emergency ends.

Parker said this bill will be the subject of an upcoming city council hearing.

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