Restaurants have high delivery fees and various premiums Delivery Margin Persecution·Profits Rat Tail “Fruit is in the Delivery App”
The reality of riders’ poor income structure in a dangerous working environment… After all, the platform fee issue
On the 7th, when the temperature in Seoul dropped to -15 degrees Celsius and a cold wave warning was issued, a motorcycle deliveryman is making delivery for lunch in Seosomun-ro, Jung-gu, Seoul. / Reporter Kang Jin-hyung aymsdream@
[아시아경제 이선애 기자, 이승진 기자] “The delivery app ate all the fruit.” On the evening of the 7th, the day after heavy snowfall, Won-hyung Kang (pseudonym), who runs a snack bar in Guro-gu, pulled up his boots, grabbed the food delivered in his hand, and left the store, saying, “I’m going to walk and walk myself because it’s an order from a nearby apartment.” . He returned 20 minutes later, redecorating his clothes, saying, “The delivery cost is too high, and on a day like today, the road freezes in sub-zero temperatures, so various surcharges are added.” He added, “Even if the demand for delivery increases explosively, the profits returning to the self-employed do not increase significantly in direct proportion,” he said. “Because the delivery business itself is expensive, the cost structure margin is too thin compared to the existing store business. As a result, the negligence is the share of platforms such as delivery apps and delivery agencies,” he raised his voice.
Can the rider (delivery agent) and the self-employed become partners in the’rider economy’ business and lead the industrial ecosystem change to a’win-win’? Although the era of’rider economy’ is opening in earnest, riders as riders and self-employed as self-employed are having a difficult day. Despite the excessive cost, self-employed people have no alternative but to use delivery apps to cry and eat mustard and use delivery agency riders. On the other hand, the reality is that riders are still unable to escape from the dangerous working environment and poor income structure.
Nationally increased delivery fees and surcharges… Deterioration in profit structure
From the beginning of the new year, delivery agency fees and various premiums have been increased nationwide. Although the rate of increase varies slightly depending on the operating region for each delivery agency, it is believed that the agency fee has increased from at least 200 won to as much as 1,000 won. It depends on adding a premium. In addition to the rainy weather surcharge, a surcharge of up to KRW 3,000 is added depending on the area with bridges and hills, apartments, and elevators.
When an average of 4000~6000 won of delivery agency comes out, the self-employed person divides the burden with consumers on an average of 1 to 1. The problem is that there is another cost to the self-employed. First of all, the biggest burden is the’platform usage fee’. Fees vary for each delivery app, but you can usually set it at around 20% of sales (including payment fees). Both labor and raw materials costs are money. Accordingly, in the case of restaurants, the sales structure of the past has changed from cost + incidental cost to cost + incidental cost increase (platform fee + delivery agency fee).
Delivery is enjoying an all-time boom, but that’s why self-employed ships, the central axis of the industry, are hungry. Young-jin Jang (pseudonym), who ran a pork foot shop in Yeongdeungpo-gu, said, “If you sell 10,000 won of food, you will remove everything, and you will have 3000 won left.” It’s just a rat tail,” he complained. Next, Mr. Jang said, “It is said that a special delivery food was created in the aftermath of the novel coronavirus infection (Corona 19), but the profits are only focused on delivery apps and delivery agencies.” The rise and various premium hikes are the harmful effects of the competition for delivery apps,” he raised his voice. Still, there is no alternative.
Even in the early days of a delivery app, signing up for a delivery app became a means to increase orders, but now, if you don’t subscribe to the delivery app, you are in a situation where you have to prepare for a blow to sales. As delivery is now a necessity, not an option, for self-employed people, struggling to increase the’delivery business margin’ even a little is made. In actual self-employed communities, various information sharing is active. Choosing the platform to use as a flagship wisely helps reduce costs. Considering the number of orders and the amount of the order, we consider various variables that determine which company it is beneficial to partner with.
Choi Chi-Hyun (pseudonym), who runs a Korean restaurant in Seongbuk-gu, said, “Since the rider delivery fee and delivery app fee are fixed, the more expensive menus you sell at once, the more you pay attention to the set configuration and increase the delivery margin by increasing the delivery margin. I am doing it.” He added, “Considering the rider’s poor environment, we can’t ask for a reduction in delivery costs,” he said. “Just choosing the platform to use as a flagship wisely will help reduce costs.” In addition, Mr. Choi emphasized, “In the era of the rider economy, platform companies should build a virtuous cycle system by lowering excessive fees so that profits can be distributed to both riders and self-employed people.”
Delivery even below -20 degrees… Need to realize delivery cost
For the win-win between riders, self-employed and consumers, Rider Union puts the establishment of overall standards and systems related to delivery as a top priority. He also emphasized that various problems related to delivery can be solved only when delivery costs, which are in place for 10 years, must be realized.
Gyo-hyeon Koo, head of the planning team at Rider Union, argued that the government had to conduct an actual condition survey related to the delivery industry, and that it was necessary to establish systems and standards based on this. It is explained that the problem is repeated due to excessive competition between riders due to different safety standards and salary levels for different delivery agencies.
Team leader Koo explained, “Even in the heavy snow and cold weather like these days, riders make delivery, but there are no clear standards regarding safety and delivery costs.” “In the event of bad weather such as rainy season and heavy snow, some store owners pay additional delivery fees, but this is an individual decision,” he said. “A rider who is disappointed with a penny has no choice but to pay more delivery fees or focus on companies that can deliver more at once.” Added.
Without clear rules regarding delivery, riders who jump into delivery are forced to be driven to the corner. Conflicts between riders, store owners, and customers are common because there is no clear rule to distinguish responsible persons in case of problems with delivery food. In addition, even in the event of an accident, it is explained by Rider Union that most of the cases are solved by the rider at their own expense because industrial accident insurance is not mandatory.
In particular, Rider Union pointed out that the realization of delivery charges, which has been in place for 10 years, needs to be addressed urgently. “The delivery fee of the rider has been the same for 10 years, but the store owners using the delivery agency are complaining of difficulties with the fee.” In the end, the delivery agency lowered the fee, lowering the burden of the store owner and increasing the delivery payment for riders. He stressed that we need to resolve excessive competition.”
Meanwhile, with the growing delivery market, the legal blind spot is also growing. As the National Assembly is expected to pass the legislation of the Living Logistics Service Industry Development Act (Living Logistics Act) on this day, concerns are spreading that this law could drive the general public into the blind spot of the law. The Living Logistics Act contains a content that only trucks and motorcycles are recognized as means of delivery and delivery.
Already,’Baemin Connect’ of the people of delivery and’Coupang Flex’ of Coupang allow the general public to freely deliver or deliver courier services using electric kickboards or on foot. In the case of Baemin Connect, as of last month, the cumulative number of registered people exceeded 50,000. If the Life Logistics Act is passed, numerous delivery workers are placed on the border between legal and illegal. Accordingly, the industry expressed regret, saying that a clear revision of the law is necessary considering the reality.
Reporter Sunae Lee [email protected]
Reporter Seungjin Lee [email protected]