Food delivery platforms typically earn their revenue through commissions on each order, plus a mix of fees and optional services. For restaurants, understanding how these commission models are structured is essential to pricing, profitability, and negotiation.

This guide breaks down the main commission structures, what influences rates, and how platforms and restaurants usually share costs and risks.

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1. Core Types of Commission Models

Most major platforms (DoorDash, Uber Eats, Deliveroo, Swiggy, Zomato, etc.) use one or a hybrid of the following structures:

1. Percentage of Order Value

Most common model.
The platform charges a percentage of the order’s subtotal (often excluding taxes and sometimes excluding tips).

• Typical range: 15–35% per order
• Higher commissions usually correspond to:
  • Higher marketing exposure (priority listings, ads)
  • Wider delivery radius
  • Platform-managed delivery (vs. restaurant self-delivery)

Example:

• Customer order subtotal: $40
• Commission: 25%
• Commission amount: $10
• Restaurant receives: $30 (minus any additional fees, such as payment processing)

Key variations:

• Marketplace fee: Commission for listing, discovery, and order processing
• Delivery fee: Often billed to the customer but may be subsidized or shared
• Service fee: Sometimes charged to both customers and restaurants to cover operations

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2. Tiered Commission Plans

Platforms often offer multiple “packages” with different commission rates based on what the restaurant gets:

• Basic / Lite Tier (lowest commission)

  • Commission: ~10–15%
  • Restaurant appears in search but gets minimal promotion
  • Often for pickup-only or restaurant-managed delivery
  • Reduced marketing and visibility

• Standard Tier

  • Commission: ~20–25%
  • Standard search ranking and delivery coverage
  • Access to basic marketing tools and promotions

• Premium / Plus Tier

  • Commission: ~25–35%
  • Priority placement in search and categories
  • Wider delivery radius, better exposure
  • Often includes loyalty programs or subscription benefits (e.g., free delivery for certain customers)

Why platforms do this:
Tiered structures let restaurants trade off lower commission vs. higher visibility and demand.

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3. Hybrid Commission + Subscription

Some platforms combine a monthly fixed fee with lower per-order commissions.

• Monthly subscription fee (e.g., $50–$200/month)
• Reduced commission (e.g., from 25% down to 10–15%)
• Sometimes includes:
  • Better placement
  • Access to analytics
  • Marketing credits

This model is more common for:

• Larger chains
• High-volume restaurants
• Restaurants using integrations or white-label ordering solutions

Example:

• Restaurant pays $100/month
• Commission per order: 12% instead of 25%
• Works well if the restaurant expects sufficient volume to offset the subscription cost

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4. Flat Fee Per Order (Less Common in Pure Form)

Instead of a percentage, the platform may charge a fixed amount per order, usually when:

• Orders have very low or very high average ticket sizes
• The restaurant is part of a special corporate or enterprise deal

Example:

• Flat fee: $3 per order
• Whether the order is $15 or $60, commission remains $3

In practice, flat fees are usually layered on top of percentage commissions (e.g., 20% + $0.50 per order) to cover transaction and operational costs.

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5. Performance-Based or Incentive-Driven Models

Some contracts include performance-related commission adjustments:

• Volume-based discounts

  • Commission drops after crossing a monthly order threshold
  • Example: 25% for first 300 orders, 22% beyond that

• Exclusivity bonuses

  • Lower commission if the restaurant is exclusive to the platform
  • Example: Non-exclusive 30%, exclusive 25%

• Promotional incentives

  • Temporary reduced commission in return for running platform-led promotions
  • Commission may increase back after promo campaigns end

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2. What’s Included in the Commission?

Commission is not just “the platform taking a cut.” Typically, it covers:

• Customer acquisition & marketing

  • App/storefront listing and discovery
  • Search ranking and featured placement
  • Promotions, coupons, deal banners

• Technology & payment processing

  • App and website operations
  • Order routing and management
  • Payment processing fees and fraud protection

• Logistics (if platform manages delivery)

  • Driver payments and incentives
  • Route optimization and support
  • Insurance and compliance costs

Depending on the agreement, some of these may be:

• Fully covered by the platform’s commission
• Shared with the restaurant via additional fees
• Passed through to customers in the form of service/delivery fees

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3. Restaurant-Managed vs Platform-Managed Delivery

How a restaurant handles delivery heavily influences commission structure.

Platform-Managed Delivery

The platform:

• Provides drivers/couriers
• Manages logistics, support, and reliability

Typical structure:

• Higher commission (e.g., 25–35%) to cover:
  • Marketplace + logistics + overhead
• Customer pays a delivery fee, which may go to:
  • Platform, drivers, or split between them

Restaurant-Managed Delivery (Bring Your Own Driver)

The restaurant:

• Uses its own staff/couriers for delivery
• Platform provides ordering and customer access

Typical structure:

• Lower commission (e.g., 10–18%)
• Platform provides:
  • Ordering system
  • Payment gateway
  • Marketing and customer acquisition
• Restaurant covers:
  • Driver wages
  • Delivery vehicle costs
  • Insurance/fuel/time

This model is often marketed as a “Lite” or “Order Only” plan.

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4. Additional Fees Beyond Commission

Commission is usually just one part of the cost structure. Restaurants may also face:

1. Setup / Onboarding Fees

• One-time charge for:
  • Menu digitization
  • Photography
  • Hardware (tablets, printers) in some cases

2. Payment Processing Fees

• Often baked into commission, but can be separate:
  • Example: 2.5–3.5% per transaction plus a fixed fee
• Applies to:
  • Credit card, digital wallet, and in-app payments

3. Marketing & Promotion Costs

• Paid advertising within the app
  • Sponsored listings
  • Banner placement
• Cost models:
  • CPC (cost-per-click)
  • CPA (cost-per-acquisition)
  • Percentage uplift in commission for promotional campaigns

4. Tablet/Hardware Rental

• Monthly rental for:
  • Order management tablet
  • Printer for receipts and order tickets

5. Integration / API Fees (for Chains)

• Fees for:
  • POS integration
  • Unified menu and inventory management
  • Centralized reporting

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5. How Platforms Determine Commission Levels

Commission rates are not random. They reflect:

1. Market Position and Competition

• In highly competitive markets:
  • Platforms may offer introductory lower commissions or discounts
• In markets with one dominant player:
  • Commission rates tend to be higher and less negotiable

2. Restaurant Type and Brand Power

• Large chains or franchises:
  • Stronger negotiation power
  • Often get custom terms with lower base commission
• Smaller independent restaurants:
  • Standardized rate cards
  • Less flexibility but may get promotional support

3. Order Volume and Average Ticket Size

• High-volume restaurants:
  • More attractive to platforms
  • Can sometimes negotiate volume-based discounts
• Low-volume locations:
  • May be offered higher commission unless incentivized for growth

4. Geography and Delivery Complexity

• Densely populated urban areas:
  • More efficient delivery
  • Commission may be moderate due to scale
• Suburban or low-density areas:
  • Higher rider cost per order
  • Commission or delivery fees may be higher to compensate

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6. Practical Examples of Commission Structures

Here are simplified example scenarios:

Example 1: Standard Marketplace with Platform Delivery

• Commission: 30% per order
• Customer order subtotal: $25
• Customer delivery fee: $3.99
• Platform takes:
  • $7.50 commission from restaurant
  • Delivery fee (used partly/to pay driver)
• Restaurant receives:
  • $17.50 (before taxes and any additional fees)

Example 2: Lite Plan with Restaurant-Managed Delivery

• Commission: 12%
• Restaurant uses own drivers
• Customer order: $40
• Restaurant charges customer its own delivery fee (e.g., $4)

Calculation:

• Platform commission: $4.80
• Restaurant revenue from food: $35.20
• Plus delivery fee collected directly by restaurant (if applicable)

Example 3: Tiered Pricing with Subscription

• Monthly subscription: $100
• Reduced commission: 15% instead of 25%
• Average monthly orders: 200
• Average order value: $30

Without subscription:

• Commission: 25% of $30 = $7.50/order
• 200 orders → $1,500/month

With subscription:

• Commission: 15% of $30 = $4.50/order
• 200 orders → $900 commission + $100 subscription = $1,000/month

Net saving: $500/month, making the subscription financially beneficial.

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7. How Restaurants Can Evaluate Commission Models

To assess whether a given commission structure is sustainable:

1. Calculate the effective margin per order

   • Food cost
   • Packaging
   • Labor
   • Commission + fees
   • Compare to dine-in margins

2. Understand what’s included in the commission

   • Is delivery included or extra?
   • Are there hidden fees (marketing, payment processing, hardware)?

3. Model different order volumes

   • Break-even point for subscription vs. standard commission
   • Impact of promotional campaigns on profitability

4. Consider strategic value

   • New customer acquisition vs. profit per order
   • Brand exposure in a competitive local market

5. Negotiate where possible

   • Volume commitments
   • Territory or time-based exclusivity
   • Trial periods to test higher tiers

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8. Emerging Trends in Commission Structures

Commission models are evolving as the on-demand delivery space matures:

• Lower commissions for pickup-only orders

  • Encouraging customers to collect their order
  • Reduces logistics costs

• Direct ordering (white-label) solutions

  • Restaurants use platform technology on their own site/app
  • Lower commission or SaaS-style fee
  • Customer still enjoys a familiar checkout and optional driver network

• Dynamic commissions

  • Adjusted by:
    • Time of day (peak vs. off-peak)
    • Demand surges
    • Location and operating costs

• Bundled services

  • Commission tied to:
    • POS systems
    • Inventory management
    • Loyalty programs and CRM

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FAQ

How much commission do food delivery platforms usually charge?
Most charge 15–35% of the order value, depending on whether they handle delivery, visibility tier, and the specific market.

Do restaurants pay commission on taxes and tips?
Typically no on tips, and varies on taxes. Many platforms calculate commission on pre-tax food subtotal only, but this should always be checked in the contract.

Can restaurants negotiate commission rates?
Larger chains and high‑volume restaurants can often negotiate better terms. Independent restaurants have less flexibility but may secure discounts for exclusivity or high projected volume.

Why is commission higher when the platform provides delivery?
Because the platform’s cost structure includes driver pay, logistics, insurance, and support, which significantly increase their per-order expense.

Is a lower commission always better for restaurants?
Not necessarily. Lower commission often means less visibility and fewer orders. The key is total profit and customer lifetime value, not just commission percentage.

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Understanding how food delivery platforms structure commissions—percentage rates, tiers, subscriptions, and add-on fees—helps restaurants make informed decisions, negotiate smarter, and align their delivery strategy with long-term profitability and brand growth.