Why is Doordash so Expensive? (12 reasons) 

The convenience of ordering food online is unmatched. 

Online ordering and delivery have grown 300% faster than dine-in sales since 2014. Who wouldn’t want to chill from the comfort of their home as they await their warm meal to arrive?

Doordash started as a food delivery app but today expanded into other delivery services. For example, Doordash facilitates alcohol delivery, grocery delivery, and flower delivery.

However, have you looked at your receipt and wanted to scream? The prices on Doordash have lately been exorbitantly high, making customers wonder what is up.

I was curious too and sought to find reasons for the price increase. This guide will give you insight and hopefully set your mind at ease.

Why Is DoorDash So Expensive In 2022?

1.  Restaurants increased meal prices

When the cost of living plummeted due to the 2020 pandemic, it did not spare restaurants. These restaurants on Doordash had to hike their menu prices to cover their operating expenses. 

Increasing menu prices is the only way these restaurants (most small restaurants) could remain profitable. 

Some of the operating expenses, like monthly rent, interior and exterior maintenance costs, and staff members’ salaries, cannot be overlooked as they are crucial to the pricing structure of the menu. 

Do you remember how things were when the pandemic set in? You couldn’t go out. Suppliers couldn’t supply on time, creating a domino effect. Restaurants, therefore, had to raise costs to cover the loss of customers.

Subsequently, Doordash increased its commission rates for these restaurants, and in turn, the restaurant passed this cost to the customer, who would feel the pinch when he ordered.

2.  War in Ukraine

When there is no peace, many businesses are affected. For example, the war between Ukraine and Russia greatly affected the food supply chain. 

Did you know that Ukraine and Russia account for about a third of the world’s wheat production and about 75% of the sunflower oil supply? 

These are the basic supplies that restaurants need to run their business. When the supply diminished due to a disrupted food chain, it forced restaurants to hike their prices. And you, as the consumer, bore the ripple effect. 

3.  Price of gas skyrocketed

Doordash does not reimburse drivers for fuel. Your dasher is an independent contractor who is responsible for fuel and vehicle maintenance. 

When fuel prices increase, these drivers will have more costs to cover. So some end up not taking orders as it’s very expensive.

When Doordash noticed that its drivers were declining offers due to his gas prices, they introduced a fuel surcharge to help cover part of the fuel costs. But how do you think Doordash bore these millions of expenses? 

At your order’s checkout point, you would feel their generosity to the drivers as they had increased the service fee.

4.  Base pay for drivers went up

Drivers need a competitive wage structure to make their gig profitable. 

Customers will not care what the restaurant might be experiencing, which may make them increase their prices. All you want as a customer is your money’s worth. Right?

Conversely, restaurants cannot afford to lower standards by reducing portions or raising prices. So to compensate for this, the customer will bear it in delivery fees. 

Doordash recently adjusted their driver’s payment policy so that they can earn more. Their base pay ranges from $2 to $10, which they receive for every order. 

How do they come up with the base pay? It depends on estimated delivery time, distance, and order desirability.

An increase in wages results in a higher delivery cost to you. 

5. The order Doesn’t Meet the Minimum Order Requirement

If your order is below $10, dollar dash will charge you a Small order fee. The minimum order varies depending on location. The small order fee is about $2. It may seem small, but it will affect your final fee overall.

But who sets the Minimum Order Requirement (MOR)? 

In their quest to be profitable, restaurants set an amount that customers must meet or exceed, ensuring that a certain amount goes to the restaurant to keep them afloat.

6.  Added Taxes

Doordash, just like any other company, pays taxes. However, the taxes will depend on the laws of the state. Therefore with every order, Doordash will include the relevant taxes making your final fee escalate.  

If the taxes in your area increase, you will feel the pinch on your order.

7.  Tipping

Doordashers have come to rely heavily on tips to remain profitable. Someone on this Reddit thread said if you cannot tip your driver, get your dinner. 

If your dasher has kept your dinner warm by carrying it in an insulated bag, you should at least add a tip. The tip is on top of the delivery and service charge. Doordash has placed up to a 15% tip on a single order. 

The other reason to tip your dasher is that they keep 100% of their tips.

8.  You ordered during peak hours or promotions

Basic economics dictates that supply and demand determine the prices of goods and services. 

Peak hours are when more people place orders (high demand). 

The order price will then go high, which is good news for drivers. If you are a driver, this is the best time to work. However, If you, as a customer, can avoid ordering at peak hours, you will save a few bucks.

Typically, peak hours are during lunch (11 AM – 2 PM) and dinner (5 PM – 8 PM), but they can vary based on location and the time of year.

9.  Food prices on the rise

Various global factors have seen a rise in food prices. Other than the one we have mentioned earlier (the war between Ukraine and Russia), we have global famine leading to food shortage. 

The following are additional reasons for an increase in food costs affecting menu prices.

Delays in prep time – When the door dashers pick up your order from the restaurant, they should ideally find it ready. 

A lag in time could mean an additional fee and service charge to the restaurant. Delays and subsequent charges that recur over time force the restaurant to increase prices to offset the fee.

Fresh food availability – the reason your favourite restaurant scores in food preparation could be because it uses fresh food products.

When harvest doesn’t produce enough to supply, this forces restaurants to find an alternative at a higher cost. That is how you may end up paying more. Unfortunately, this is something Doordash is not in control over.

Operating cost (Transportation)– Restaurants always transport things back and forth, be it supplies or even staff to work. Depending on where they get products, it can greatly affect the operating budget and, consequently, the price of your favourite delicacy. 

10.  DoorDashers Face a Lot of Competition

Doordash sends a delivery request to a nearby driver when you place an order.

Doordash employs dashers as independent contractors, responsible for their car fuel and maintenance, as we had seen earlier.

Therefore, every order they receive should satisfy a certain level of expense. Dashers cannot meet their expenses sufficiently if they keep accepting small orders and risk getting bad ratings. 

To find ways and strategies to maximize earning with Doordash, drivers found a way to game the system.

Now, there is something we call the DeclineNow movement; ever heard of it?

When drivers tired of delivering for low fares, they found how to manoeuvre the Doordash algorithm. They collectively decided to avoid low orders and, in the process, push the base pay up.

Once you decline a lowball offer from Doordash, the algorithm raises the base pay for the next driver resulting in high-paying offers. You end up paying more for your order through high delivery and service fees.

11.  DoorDash Service Fees, Customer Location Fees

Doordash service fees vary depending on where you live. For example, if you live further from the restaurant, the service fee will be higher because your driver must commute further.

Doordash provides service; otherwise, you would have forfeited the comfort of your house to pick up your dinner. The service fee ranges from 10% to 17%, depending on where you are.

12. Pricing Regulations

With the ever-changing economy, the cost of goods and services keeps rising. As a result, some states have put into play a regulatory cap that limits the amount Doordash can charge.

The caps were in place to create a positive situation for owners struggling to stay afloat during the pandemic. In addition, caps meant profits for restaurants. 

If we remove caps, there will be no regulation to watch Doordash or other food delivery from soaring prices. 

An example of how the fees work is placing an order using the DoorDash app.

The cost of the food item is $14.

DoorDash adds a service fee of $2.10 and a location fee of $2.00.

There’sThere’s also a sales tax of $1.30, making the order total $19.40.

Of that $19,40, the restaurant receives an estimated $11.90 and DoorDash an estimated $6.20 in fees.

Without caps, commissions to restaurants can range from 20 to 30 per cent per order, plus increased delivery fees for customers.

How do you save money on Doordash?

Schedule orders

As we have seen, there are times in the day when food prices will go high due to the large traffic of orders. They are called peak hours, mostly during lunch hours and dinner times. 

Instead of entirely avoiding ordering at these hours, try scheduling your orders. The beauty of scheduling orders is that the prices at peak hours won’t affect you.  

Compare Food Prices or order pickups. 

Doordash has a variety of restaurants from which you can choose. If your favourite restaurant is a bit expensive, try another. You may be pleasantly surprised that your favourite dish is still a delicacy in the new one. 

If the restaurant you are ordering from is a couple of blocks away, consider ordering pickups. It may be an opportunity to get your daily steps in as you walk to pick up your order and avoid crowded restaurants once it’s ready. 

Doordash confirms that Pickups are fee-free for customers.

Food Delivery App Subscription

The convenience of having your meal delivered to your doorstep can make your order more than you think. 

So Doordash decided to make life easier for its patrons by introducing a DashPass subscription; you can easily save that delivery fee on your orders.

Here is how it works; If you order dinner daily for a whole week, you might find that you have already surpassed the Monthly membership fee of $9.99. The subscription helps you still order and not to pay more for deliveries.

Take Advantage of Discounts  

You can take advantage of hundreds of customer promo codes and discounts on Doordash.

Apply the promo code when checking out to save some amount on your order. You can also enable email notifications not to miss any offers. 

So as not to miss out on Doordash promotions, follow them on all their social media platforms, such as Twitter, Facebook, and Instagram. 

Conclusion

Doordash is very handy when it comes to deliveries. The reason why it seems expensive is because of the high delivery fees. Recently Doordash increased the base pay for its drivers.