In Light of Coronavirus, Grubhub to Suspend Commission Payments for Independents
Source: FSR Magazine
In a move to help restaurants grappling with the coronavirus fallout, Grubhub announced Friday that it will suspend collection of up to $100 million in commission payments from independent restaurants.
“Independent restaurants are the lifeblood of our cities and feed our communities,” said Grubhub Founder and CEO Matt Maloney in a statement. “They have been amazing long-term partners for us, and we wanted to help them in their time of need. Our business is their business—so this was an easy decision for us to make.”
The third-party provider also created a fund that will allow proceeds from its Donate the Change program to benefit charities that support restaurants and drivers impacted by COVID-19. The program will allow customers to round up the change from every order and donate it to the Grubhub Community Relief Fund—with donations from Grubhub+ (and Seamless+) members matched by the company. Grubhub has raised more than $1 million dollars per month through Donate the Change.
The announcement comes as struggling restaurants face sliding sales and concerns about payments. The Seattle Times reported that at least 50 restaurants and bars have closed in the Greater Seattle area in the past two weeks. New York recently cut the legal capacity of restaurants by 50 percent to prevent the spread of the coronavirus.
“As dine-in traffic is expected to slow up to 75 percent over the next few weeks, restaurants will rely on pickup and delivery orders to stay in business. “We have seen revenue decrease in the past week as a direct result of our customers staying home,” said Darnell Johnson, owner of Chicago’s Home of Chicken & Waffles. “Grubhub has helped us generate more delivery and takeout orders as our customers' dining habits have changed. This has helped us continue serving our loyal customers and our employees can continue living a sustainable lifestyle.”
Founded in 2004 in Chicago, Grubhub boasts a restaurant community of more than 350,000 and drives more than 80 percent of the company’s orders. Grubhub is offering contactless delivery and a list of health and safety guidelines for its drivers and customers.
“The City of Chicago is deeply concerned about the risk COVID-19 is placing on the health of our residents and communities, as well as the impact it’s having on our working families and neighborhood economies and restaurants,” said Chicago Mayor Lori E. Lightfoot. “That is why we applaud corporate leaders like Grubhub who are stepping up with practical measures to support small businesses and their employees. Now more than ever, we must work together to ensure hardworking Chicagoans receive the support they need to thrive while also staying safe, secure, and healthy.”