Restaurants Rethink Third-Party Delivery as Costs Bite into Profits

The pandemic delivery boom has faded, leaving restaurants to find new ways to manage off-premise orders

Jan. 30, 2026 at 8:47pm

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The pandemic turbocharged third-party delivery, turning it into a lifeline for restaurants. But as the dust settles, a growing number of operators are realizing that convenience comes at a cost – a significant bite out of already-thin profit margins. Restaurants are exploring strategies like direct ordering, hybrid models, and forming cooperative delivery networks to regain control of their off-premise business and reduce reliance on high-commission third-party apps.

Why it matters

The delivery dilemma highlights the challenges restaurants face in balancing customer convenience with profitability. As third-party delivery services continue to dominate the market, restaurants must find innovative ways to manage their off-premise operations and retain more of the revenue generated from online orders.

The details

During the height of lockdowns, services like DoorDash, Uber Eats, and Grubhub were essential, with Big Red F seeing delivery account for up to 40% of sales on peak nights. Nationally, consumer spending on these platforms continues to climb – DoorDash processed over $72 billion in the first three quarters of 2023, a 23% increase year-over-year. However, the high commission fees ranging from 10% to 30% per order are proving unsustainable for many restaurants. Restaurants are exploring strategies like direct ordering, hybrid models that balance third-party reach with profitability, and forming cooperative delivery networks to reduce reliance on high-commission apps. Delivery apps have introduced tiered commission structures, but 50% of operators still cite third-party fees as the biggest challenge to off-premise growth.

  • During the height of lockdowns, delivery accounted for up to 40% of sales on peak nights for Big Red F.
  • In the first three quarters of 2023, DoorDash processed over $72 billion in orders, a 23% increase year-over-year.

The players

Big Red F

A Colorado-based restaurant group that saw a significant increase in delivery orders during the pandemic.

DoorDash

A leading third-party delivery service that processed over $72 billion in orders in the first three quarters of 2023, a 23% increase year-over-year.

Uber Eats

A third-party delivery service that saw a 20% jump in orders, reaching $65 billion in 2023.

Dave Query

The founder of Big Red F, who discovered that the revenue generated from third-party delivery often doesn't outweigh the expenses.

Stella Dennig

The owner of Daytrip Counter in Oakland, California, who is facing a suggested advertising budget of $637 per week from a third-party delivery app.

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What they’re saying

“We must not let individuals continue to damage private property in San Francisco.”

— Robert Jenkins, San Francisco resident (San Francisco Chronicle)

“Fifty years is such an accomplishment in San Francisco, especially with the way the city has changed over the years.”

— Gordon Edgar, grocery employee (Instagram)

What’s next

Several trends are likely to shape the future of restaurant delivery, including increased consolidation, the rise of ghost kitchens, the exploration of restaurant-led delivery networks, technological advancements in delivery logistics, and a focus on building direct relationships with customers to capture valuable data.

The takeaway

The delivery dilemma highlights the need for restaurants to carefully balance the convenience and reach of third-party delivery services with the need to maintain profitability and control over their off-premise operations. Investing in direct ordering channels, exploring alternative delivery solutions, and forming cooperative networks are strategies that can help restaurants navigate this evolving landscape.