Following Waitr’s implementation of performance-based rates, several Baton Rouge restaurateurs have dropped the service, citing concerns about whether the rates are actually profitable for area restaurants.
Russell Davis, owner of Eliza and Jed’s Local Po-boys on Jefferson Highway, joined Waitr in February upon opening the po-boy shop. At the time, he agreed to a 15% fee rate, but he says the updated fee structure would kick the rate to 24%.
“Just like any business, especially in restaurants, you have to manage really well to get 5% or 10% profit,” Davis says. “But there’s no way we could make those numbers work at 24%. We’d be losing money.”
Davis has stayed in communication with the company, but doesn’t expect that they’re going to renegotiate the terms. He hasn’t considered adding the restaurant to another platform—which tend to charge higher rates than Waitr—but says it doesn’t mean the eatery won’t add another service or try delivery themselves in the future.
Ozzie Fernandez, founder and CEO of Izzo’s Illegal Burrito and Lit Pizza, is continuing to negotiate with Waitr on terms, but until a deal is struck has pulled his 14 stores from the platform. Not only is he uncomfortable with the revised fee structure, Fernandez objects to multi-unit stores being treated as individual restaurants.
“We don’t want to paint them in a negative light, and we hope to have this resolved, but both sides needs to be profitable for this to work,” Fernandez says, adding he thinks guests should be cast with the cost of delivery. “We like to support local business, and Waitr is one of these.”