--- title: "The Hidden Cost of the Third-Party Delivery Boom and How to Win" url: https://burnaze.com/article/bc3ab536-5627-4087-9ec4-97c16446d29d source: "QSR Magazine" original_url: https://www.qsrmagazine.com/story/the-hidden-cost-of-the-third-party-delivery-boom-and-how-to-win/ author: "Danny Klein" category: "Restaurants" industry: "Restaurants" published: 2026-05-18T12:25:58.000Z modified: 2026-10-31T13:18:50.226Z image: https://www.qsrmagazine.com/wp-content/uploads/2026/05/RyanO2.jpg --- # The Hidden Cost of the Third-Party Delivery Boom and How to Win **TL;DR:** The rise of third-party delivery apps has changed the way quick-service restaurants operate, with 30-40% of dine-in customers shifting to drive-thru and delivery, and the global online food delivery market estimated to reach $1.6 trillion by 2027. Restaurants face challenges such as high commission fees and refunds, but can improve their chances by partnering with delivery drivers and offering a good experience. *By Danny Klein, originally published in QSR Magazine on 2026-05-18. [Read the original](https://www.qsrmagazine.com/story/the-hidden-cost-of-the-third-party-delivery-boom-and-how-to-win/).* ## Key facts - The online food delivery market is estimated to reach $1.6 trillion by 2027 - The average delivery aggregator charges a commission fee ranging from 20–30 percent - Restaurants that invested in delivery drivers saw an increase in customer satisfaction scores ## Story Over the years, the typical QSR customer has changed. One of the biggest changes is that 30–40 percent of dine-in customers have moved toward the drive-thru. This shift originally driven by COVID caused the customers to visit their favorite restaurants a different way. Consumers have pivoted yet again, ordering food remotely through delivery partners like DoorDash and Uber Eats. The delivery shift likely would have happened organically but was accelerated with the pandemic. Food delivery is still early as a business and likely to grow considerably. Globally, the online food delivery market is estimated to reach $1.6 trillion by 2027. Of that global share, the U.S. represents just short of $500 billion, growing at an annual rate of 15 percent. I would comfortably say delivery isn’t going anywhere anytime soon. With delivery revenue opening access to a large share of the consumer base, restaurant owners naturally have a strong interest in participating. Restaurateurs are looking to grow sales and transactions at their physical restaurant, but can’t ignore the opportunity delivery brings. ## Delivery costs and challenges For some guests, delivery isn’t a convenience—it’s the only way they’ll order from you. This new consumer base in delivery doesn’t come cheap. The average delivery aggregator charges a commission fee ranging from 20–30 percent. Rarely is this delivery customer loyal to your brand. The delivery platform owns that customers loyalty. During COVID, delivery habits increased, allowing delivery platforms rapid growth. Some cities even established commission caps to stem fee growth to 15 percent per order following pandemic era emergency measures. Restaurants can do some things to improve their chances of being selected from the many options on delivery websites. How fast a restaurant executes the delivery orders can dictate where they land on the ranking. For those operators that want to be toward the top of the list, restaurants need to offer a deal/discount or purchase a sponsored listing. These items can increase your frequency but eat into your margin. As Expedia grew in popularity with hotel chains in the mid 2000s, their business model was disrupted. The restaurant industry is facing a similar disrupter. Time will tell on how individual restaurants and the industry as a whole adapt. Food delivery apps are essential for restaurants to connect with customers remotely, but the way refunds and reimbursements are handled has created frustrations. Many of the large delivery providers issue refunds to customers and then charge the restaurant for the cost, even when the root cause is unclear or outside the restaurants control. From the customers standpoint the process works well. Apps offering near instant refunds reduces friction and builds loyalty within their program. There are legitimate reasons a restaurant should be required to pay a refund, like accuracy of orders and food quality to name a few. Restaurants are often held responsible for items they do not control like delivery logistics of the driver, fraud or abuse of drivers or customers, and packaging limitations. A refunded order can turn a small profit into a loss. Many restaurants hire third party companies to dispute delivery app refunds. While this service isn’t free, it helps to reclaim revenue that would otherwise be lost. In my business, I have encountered a variety of behaviors among delivery providers. Some drivers are courteous and efficient, communicating clearly and waiting their turn alongside dine-in guests. Others, however, can be inconsiderate—for instance, I’ve seen drivers cut in front of existing customers in their rush to pick up orders. These contrasting experiences highlight the challenges restaurants face in maintaining a positive environment for both in-person guests and delivery partners. An adversarial role can be fostered between restaurant and delivery driver pitting an us versus them approach. The mindset shifts when you recognize that your delivery partners—and the drivers who represent them—are often your single largest customer. ## Partnering with delivery drivers I tried to see delivery not as just another ordering channel, but as my most important customer. I could fight what felt like constant injustices and disruptions—or I could become a partner in the process. I wanted to become the number one restaurant a delivery driver chose to pick up from. Our restaurants would be chosen quickly from delivery apps due to our consistency of restaurant experience, readiness of order and lastly, how we treated the drivers. Delivery drivers are often treated as a commodity, a means to transport the food from restaurant to end user. I identified that if I could make the delivery drivers experience better, I was enhancing the end experience of the away from restaurant customer. One of the first things we did was to ensure the order was ready for the driver when they arrived at the restaurant. The order had to be easy for the driver to find so they were efficient with their time. Thinking with a driver’s cap on, time was money—or money missed out on. To eliminate more roadblocks, I looked at how we could keep drivers out of the pick-up window lane altogether. We installed dining room pick up windows and mobile delivery shelfs in the vestibule so the driver could avoid the PUW and come directly inside and get their order with speed. This freed up the PUW for customers who weren’t picking up delivery orders, creating a faster experience and higher level of satisfaction. If we couldn’t directly hand the food to our customers in a delivery order, the driver was the next best thing. I wanted them to feel claimed at our restaurants so they would represent us in a positive light. We implemented giving free drinks to the drivers when they came in to pick up an order. This was a simple sign of recognition that they were part of the team. We further claimed the delivery drivers by instituting a loyalty program. The loyalty program recognizes them for their contributions in connecting our restaurants to diners. Investing in drivers isn’t just a feel-good gesture—it pays dividends in restaurant execution and guest experience. Restaurants that implemented these programs saw an increase in customer satisfaction scores. In the months that followed, delivery sales increased steadily, our delivery speed scores improved, and the average check rose. Delivery is here to stay, and the restaurant industry is likely to see a net benefit because of it. From its humble beginnings in the urban core, expanding to small-town America, delivery apps have grown to more than 180 million users. This group of disruptors created a need many consumers never knew they had. Restaurants gained a way to reach guests who couldn’t travel to the dining room, and customers gained a convenience that bought back their time. Delivery isn’t without challenges for the restaurant industry, but when operators identify how to make it a positive, it becomes a net win. The restaurant industry has spent years treating delivery as something that happens *to* them—a disruption to manage, a fee to absorb, a driver to tolerate. But the operators who will thrive in the next chapter of this industry are the ones who recognized the shift early: delivery isn’t a threat to hospitality, it’s an extension of it. Every driver who enters your restaurant collecting an order is carrying more than a bag—they’re carrying your reputation, your relationship with a customer you may never meet face to face, and your best chance at earning that customer’s next order. Treat that driver like your most important guest, and they will. ***Ryan O’Malley’s** restaurant career began in 2007 at Wendy’s of Bowling Green, where he held roles from GM to district manager to director of operations. In 2021, he made the leap to Wendy’s franchisee. Today, O’Malley and his partners operate 153 locations across five states (Indiana, Kentucky, West Virginia, Tennessee, and Alabama). He represents Wendy’s franchisees as a member of the Board of Directors for Wendy’s Franchise Association and is President of the Louisville Franchisee DMA. O’Malley, who lives in Louisville, oversees the Indiana and Kentucky units.* ## Entities - QSR (sector) - QSR Magazine (publication) - DoorDash (company) - Uber Eats (company) - qsr industry (topic) - Danny Klein (person) - third-party delivery (topic) - Expedia (company) - delivery costs (topic) - partnering with drivers (topic) --- Originally reported by Danny Klein, QSR Magazine (https://www.qsrmagazine.com/story/the-hidden-cost-of-the-third-party-delivery-boom-and-how-to-win/). Summarized by Burnaze (https://burnaze.com/article/bc3ab536-5627-4087-9ec4-97c16446d29d).