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Call to arms: Flame Bar & Grill co-owner Lou McDowell

By PHILIP CHANDLER

A Queenstown restaurateur’s urging industry colleagues to boycott controversial American-owned food delivery giant, Uber Eats.

The app-based company on Wednesday announced it’s launching in Queenstown, along with New Plymouth and Nelson, in early October, to extend its New Zealand reach to 13 centres.

Flame Bar & Grill co-owner Lou McDowell notes there’s recently been a massive backlash
against Uber Eats.

During the Alert Level 3 lockdown, when only takeaway restaurant food was available,
Prime Minister Jacinda Ardern suggested Kiwis support local businesses instead.

McDowell: ‘‘I am going to try to get the word out to all restaurants to boycott them so
we can all survive Covid, protect our very slim margins and support local — like Food on Q,
which has been amazing through Covid.’’

Uber Eats charges diners low delivery fees but stings restaurants up to 35% in commissions.

‘‘Regardless of the order volume, at 35% it’s not profit-able for any food operators,’’ she
says.

‘‘By the time you’ve paid 30% food costs, 30% labour … there’s nothing in it.’’

Restaurant Association of NZ boss Marisa Bidois agrees.

In April, she said Uber Eats’ commissions were ‘‘crippling for many hospitality businesses’’, and it was ‘‘essentially taking the shirt off the industry’s back’’.

As a result of the backlash, Uber Eats did decrease some fees.

McDowell’s other concerns are the company’s drivers are ‘‘exploited’’, and there’s no recourse if you get the wrong order or your food’s late.

By contrast, she says Food on Q pays its drivers a guaranteed wage and has staff you
can talk to if you have a problem.

Longtime local restaurateur Grant Hattaway, who’s latterly had Blue Kanu, says ANZ found, in 2018, decent-sized restaurants were only making an average 7.5% return.

‘‘I think the game’s tough enough without handing over $10 notes, per meal.

‘‘You’re going to get [restaurateurs] who aren’t doing well who are going to be tempted
because it’s cashflow, but cashflow doesn’t equate to net profit.’’

However, he thinks McDowell’s call to boycott Uber Eats ‘‘might be a bit extreme’’.

‘‘But Blue Kanu won’t be part of it — we have our own online system.

‘‘You do have to pick up yourself, but there’s no commission.’’

Food on Q owner Danny Sykes, who employs about 40 staff, says his delivery fees
range from $6.99 to $11.99, depending on the distance travelled.

‘‘Uber might be cheaper when it comes to the delivery fee, but the restaurants get
exploited.’’

He says his restaurants are charged between 20 and 25%, depending on the relationship he has with them.

He accepts Uber could have some impact on his business, but says ‘‘we’re like night and day compared to those guys, you know — we’re a small, local start-up’’.

Responding to McDowell’s ‘boycott Uber Eats’ call, local Chamber of Commerce executive chair Craig Douglas says: ‘‘I think business owners need to go into any arrangement with a delivery service like Uber Eats with their eyes open, and they need to understand at what point the commission structure becomes untenable for them.’’

He adds: ‘‘There have been local businesses operating in this space for quite some time,
and they’ve built themselves a good reputation, and one of the themes of the whole Covid
disaster has been ‘supporting local’.’’

Mountain Scene on Wednesday asked without success to speak to Uber Eats NZ head Elisa Janiec.

An account manager, who passed on an interview request, asked who Scene had spoken
to and said ‘‘we’d like this to be an uplifting piece’’.

scoop@scene.co.nz