Also the online ordering infrastructure that has to be developed and maintained is run (and paid for) by corporate - not the franchisees (I assume). This makes the online ordering system essentially it's own business that must provide it's own value to get paid.

The price of the pizza goes to the restaurants, the delivery fee goes to the driver (mostly, I hope), and the "online convenience fee" goes to the business running the online ordering system. It all works out.

"Convenience Fee" is a bullshit weasel term that needs to die, though. Call it "excess profit" if you like, but businesses that piss on my leg and tell me it's raining get zero sympathy, and I hope they all go bankrupt in the upcoming recession.

I strongly disagree with this. An efficient market requires that consumers have accurate information available to them in order to compare prices, just as an efficient market requires a government that prevents outright fraud.

Retail businesses spend a lot of effort manipulating the customer experience using A/B testing: they understand that there's a time and information asymmetry between business and consumer, and so they go to great lengths to withhold pertinent information so that the consumer can't compare prices before shopping. A standard technique is to advertise one price, then tack on unadvertised "fees" that only appear later in the checkout process once a consumer has invested significant time and effort into the order. An even uglier one (hey DoorDash) is to advertise a "delivery fee" up front and then later present a separate line item labeled "taxes and fees" that contains a second portion of the delivery fee (previously unadvertised and also labeled in a deceptive way.)

If you want to let businesses mislead consumers without limit, then you might as well build a society that legalizes false or fraudulent advertising entirely: that's close to what these businesses are doing here.

If you look at their daily sales, outside of days when pizza is a norm like the superbowl, I'd be surprised if they haven't decreased in many categories since they added the additional fees after the pandemic began, they have declined as a result of the increased price of delivery orders. The service fee was also in place prior to inflation surging as well, which defies logic.

It's opportunistic to charge more in this way, it's actually tacking the cost savings of coupons on at checkout, which also makes it a rather deceptive practice, whereas, the simply could have increased the cost of their pizza margins, but these days cost schemes online have become the norm on top of taxes and tips. It's a shameful business practice that not enough people call out.

> First, my neighborhood pizza place offers free delivery. And it’s really good pizza.

Do they have a mobile app to order from, shows real time order status, coupons, and rewards? And, as you said in your second point, the delivery isn't free. The cost is built in to the pizza. So if you dine in, or pick up, you're paying a premium to subsidize the cost of delivery.

> Extra mental labor to work out true price instead of advertised price.

The final price is shown before checking out. This is no different than purchasing from Amazon, booking a flight on Expedia, or getting a hotel room on Booking.com.

> Third, dominos used to charge $0 for delivery even though margins were the same back then.

Yes, back before domino's had to compete against other national fast food chains' technology strategies.

How do you know margins are the same? That statement is extremely unlikely. Food prices have surged, yet Domino's Pizza still runs some of the same specials... $5.99 medium pizzas, tons of coupons, etc. Secondly, the market for delivery drivers has gotten enormously more competitive. Used to be pizza and Chinese food were the only places likely to deliver. Now GrubHub, Uber, Door dash, etc. It's just harder to find people willing to drive (oh, gas prices are higher too,maybe you've noticed) your food to you.