Angry with Waitr’s recently announced switch to a “performance-based rate structure,” many Baton Rouge restaurant owners plan to pull from the delivery service once the fee structure goes into effect.
Based on the terms of the new agreement, partner restaurants with food sales from the Waitr platform exceeding $20,000 will be charged a 15% commission from Waitr for every transaction. The commission increases in brackets, reaching a cap at 25% for restaurants with monthly food sales at or below $1,000. The terms also prohibit restaurants from charging a higher price for food ordered through Waitr than regular, in-restaurant transactions, instead passing along the fees charged by credit card companies to the restaurants.
In an emailed statement, Waitr says its partners “will discover this is a far more attractive option than those offered by our competitors,” arguing that “the more our restaurant partners deliver, the lower their rate will be.” But local restaurant owners say the move makes Waitr—traditionally viewed as an affordable option for partner vendors—more comparably priced with competitors like UberEats and DoorDash. It also forces restaurants getting less business from Waitr sales to shoulder more of the cost burden amid already slim profit margins.
“For many restaurants, it becomes not worth it,” says Stephen Hightower, owner of City Group Hospitality Co., which owns City Pork, City Slice and Rouj Creole. “We already have razor-thin margins, and with so much competition it makes it hard not to search for the dollar in sales, and delivery is such a major part of everyday life.”
While Hightower hasn’t yet decided if he’ll sign the new agreement, others are more certain. Kalurah Street Grill co-owner Brad Watts, for example, is discontinuing the delivery service—an easy decision, he says, considering it never yielded a high sales volume for the restaurant.
Rocco Moreau, owner of Rocco’s New Orleans Style Poboys and Cafe, says he will “absolutely discontinue” his partnership, noting Waitr has been steadily increasing its vendor fees since he started using the service years ago, and he’s had to eat the costs. Instead, Moreau says his Drusilla location will likely implement its own delivery program in an effort to save money.
Rotolo’s Pizzeria owner Mitch Rotolo doesn’t know how he can continue his partnership with Waitr, saying the 30 days notice partner restaurants were given by Waitr to sign the new agreement “wasn’t sufficient.”
“This would force vendors like me to increase my prices across the board; my business model will either change to accommodate Waitr, or I can’t use Waitr as a vehicle for my business,” Rotolo says. “Who’s really going to end up paying for this? Nothing will happen unless the customers get angry.”
Meanwhile, Ruffino’s will also stop using Waitr if they move forward with the “cowardly” new terms, says owner Ruffin Rodrigue.
“Ruffino’s feels like small restaurateurs are being punished for having a lower dollar volume, or in our case, dinner-only service hours, which make it very difficult to hit their minimum,” Rodrigue says in an emailed response. “So we are going to be punished for that?”