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12/13/2021

Minneapolis Moves to Make Delivery Fee Cap Permanent

Third-party delivery marketplaces provide increased reach and marketing power for brands big and small. And consumers have embraced the convenience of delivery; off premises sales show no signs of slowing down. 
Anna Wolfe
Senior Editor - Restaurants
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Minneapolis has moved to make the temporary caps on third-party delivery fees permanent, reports the Minneapolis Star Tribune.

Last year the Minneapolis mayor issued an emergency regulation to cap third-party delivery fees at 15%.  Last week the Minneapolis City Council voted to make the cap on third-party delivery fees permanent.  

Third-party delivery marketplaces provide increased reach and marketing power for brands big and small. And consumers have embraced the convenience of delivery; off premises sales show no signs of slowing down. 

[75% of consumers prefer to order delivery direct from the restaurant, according to HT's 2021 Customer Engagement Technology Study.]

Many cities and states moved to cap third-party delivery fees, in most cases temporarily, during the pandemic when many restaurants were forced to close their dining rooms.  As the pandemic continues on, some cities are moving to make the caps permanent.

In August, New York City lawmakers voted to permanently cap the fees that third-party delivery companies can charge restaurants at 15% per order.  This is subject to review every two years.  

San Francisco also moved to permanently cap delivery fees charged at 15%. In response, third-party delivery companies have filed lawsuits against both cities.

Domino’s is weighing in on the debate. The global pizza brand has taken to the airwaves to encourage consumers to order direct from restaurants  and spent $100,000 in gift cards in support of local mom-and-pop restaurants.