DoorDash Revamps Delivery Fees, Basing Charges on Distance and Effort
The delivery platform is rolling out a new fee structure that adjusts costs based on order distance and the effort required for delivery drivers.
DoorDash is implementing a new fee structure that will adjust consumer charges based on how far an order travels and the effort required by a delivery driver. The changes, which began rolling out in select cities on Tuesday, could result in higher or lower costs for customers depending on the specifics of their order.
Under the updated model, delivery fees will be a fixed charge set by the merchant, while service fees will now vary. This new service fee calculation will consider factors such as the distance of the delivery and the size of the order. DoorDash has also introduced a "long distance fee" for deliveries exceeding 10 miles on a small number of orders.
To enhance transparency, the app will now include a tab alerting customers to potential higher fees for longer-distance orders. Additionally, an in-app explainer will detail how the fees are calculated, and a new breakdown will be available on store pages showing subtotals, fees, and discounts before an order is placed.
DoorDash stated that the changes are designed to more accurately reflect the cost of fulfilling each individual order. A company spokesperson indicated that over 70% of recent orders would have cost the same or less under the new system, with potential savings of a median of 78 cents per order for those whose orders would have been cheaper.
Customers ordering from nearby restaurants may see lower overall fees, as they will avoid the higher distance-based charges. However, the company acknowledged that this would not benefit customers whose preferred establishments are located more than 10 miles away.
All fees and taxes will continue to be displayed on the checkout screen prior to order finalization. While the rollout begins in select locations, customers in California, Chicago, Colorado, the District of Columbia, Massachusetts, Minnesota, New York City, Puerto Rico, and Seattle will experience these changes at a later date.
DoorDash emphasized that the new fee structure does not impact how delivery drivers, known as Dashers, are paid. Dashers will continue to be compensated for their time and effort, and the company noted that many drivers earn more on longer deliveries. The updated model aims to ensure continued fair pay for Dashers while allowing consumers to order from a wider range of stores, including those farther away.
Despite the company's explanations and potential for savings for some customers, the changes have drawn criticism online, with some users expressing concerns about increased fees.