Zhuoxin (Allen) Li on saving the restaurant industry

In 2020, more than 110,000 restaurants across the U.S. shuttered. Carroll School Assistant Professor Zhuoxin (Allen) Li, who’s been studying the consequences of eateries partnering with delivery platforms during the pandemic, shares the best way to buoy your local taqueria.

How can delivery services such as UberEats and DoorDash hurt small restaurants?
These apps offer many options and make it easy to compare prices. Because the premium services that independent restaurants use to justify higher prices for dining in aren’t available with delivery, customers become more price-sensitive and are less likely to choose more expensive restaurants.

States and cities have begun capping the fees that delivery services charge independent restaurants. Is this helping them?
The benefit to independent restaurants seems obvious: They pay 15 percent rather than 30 percent of their delivery sales to the platforms. However, since the platforms now take a smaller cut from independent restaurants, they may switch to promote chains or restaurants from nearby cities without such regulations. The apps may also transfer some of the costs to customers.

So, what can we do?
Order directly from restaurants and pick up if possible, especially when you are placing a big order. That way, restaurants get to keep all the revenue. ◽