Impact of Delivery Apps Commission Rates on U.A.E Restaurants

ABSTRACT

this paper examines that how COVID 2019 has negatively impacted the food industry in the U.A.E, resulting to the reliance of third-party applications to deliver food to their consumers. Food delivery apps have become popular not only in the U.A.E, but worldwide, as people take precaution through social distancing and quarantine in the hopes of curbing the spread of the coronavirus. Restaurant owners have put delivery services on the spotlight, urging them to cut down their commission rates as they are negatively implicating their businesses. Third-party services have been known to take commissions out of the restaurant owners they partner with. However, restaurant owners complain that these rates have increased over the years, with zero reductions especially with slow business as a result of the pandemic. Delivery apps have not waivered their commissions, charging as high as 35% per order, which is not inclusive of a delivery fee for the consumer. The food industry is requesting third-party companies for a 10% reduction for each order, for them to be able to make ends meet. The paper encloses a survey conducted on restaurants in the U.A.E to assess the impact of commission rates by these delivery apps. The results showed that the restaurants are struggling to keep afloat, a factor that is bound to affect the employment of many staff members in these hotels. The paper, therefore, outlines the impact of these commission rates among other charges on restaurants and other food businesses in the United Arab Emirates.. © 2021 IEEE.