What about in countries where tipping is not normal? I live in the UK and lots of small family-run fish and chip shops and takeaways offer delivery, along with the bigger chains like Dominos.
Personally, I’ve ordered a ton of food delivery lately from places I’ve wanted to try but never found time to go. But, I don’t order from them more than once, so those businesses aren’t making a customer out of me.
I assume tips are generally more than $1 (I may be wrong).
Maybe it’s just not productive to compare different countries’ eating habits in the end, but it seems to me GP is saying that tips make up a meaningful proportion of delivery drivers’ income.
It seems like the GP(?, the first poster in this chain) was saying that delivery works for places like Domino’s which hires and pays their own couriers a standard wage. That wage is already accounted for in Domino’s pricing, and since that employee has to show up to work even when there aren’t deliveries they can be put to work. Thus, there are no additional costs to Domino’s as everything is presumably priced taking this into account.
When you outsource your delivery, the company being hired takes a cut. That company (Postmates etc) need to use this cut to pay their couriers. Postmates can only ask for so much before the store just says no, it’s not worth it. Those couriers need to be paid enough that it’s worth it for them to keep delivering. So, Postmates scales up to make up for it in bulk by taking losses by offering deals. Those deals don’t last forever, and customers like me only order because of the deals will just go away.
First is pure utilization. App drivers get paid while on the road and while idle, store drivers get paid hourly while on the clock and usually have some useful work to do. The average pay of road & idle time has to be worth the driver's while, and the store driver has more valuable work they can do, so the economics make more sense.
Second is the largely tip-driven pay differential while on the road vs in the store. 3 deliveries an hour at my store, more at places that trade off service times for throughput. Average of $3-4 per run, with a tendency for higher tips for customers further from the store. (Funny example: there was this one house at the exact furthest corner of the store's delivery area. They were extremely nice and tipped like $7. These facts are not coincidental.) But this basically becomes a cross subsidy of in-store work by tips, and there was a decent chunk of tension between drivers and management over this. Usually it took the form of "do your assigned side work and then you can go home", and since doing dishes was the "bad" pay of the shift, this disincentivized malingering too.
As far as I can tell for non-tipping countries, drivers tend to use employer-provided vehicles and fuel, so it turns into a more straightforward hourly job and loses a good chunk of the piece-work and quality incentives.