Uber Eats and Mr D vs direct buying — The price you pay for convenience

Purchasing food on Mr D and Uber Eats is substantially more expensive than buying directly from a restaurant or takeaway outlet, even before adding delivery and service fees.

The reason for this is fairly straightforward — the delivery and service fees themselves are not sufficient to cover these companies’ operating costs and cannot support sufficient earnings for drivers.

Instead of having a big flat delivery fee charged directly to customers, the services charge a commission to restaurants to be able to serve customers on their platforms.

However, at the end of the day, the restaurants have to make their products more expensive when bought on Mr D or Uber Eats to compensate for this additional cost and maintain sustainable profit margins.

Therefore, the customers pay for a marked-up product, which many are willing to do simply because of the convenience that on-demand delivery offers.

Multiple reports citing information from restaurants that use the platforms have stated the commissions are typically around 30% of the value of the products in an order, although this may vary depending on the specific agreement a restaurant has with the companies.

In their latest feedback, neither Mr D nor Uber Eats would provide their latest commissions charged to restaurants with MyBroadband.

An Uber spokesperson said although it could not comment on specific marketplace fees, it wanted to reiterate that these were put in place to contribute towards the creation, growth and success of an economically sustainable sector that facilitated growth and earning opportunities for all stakeholders — including merchants and drivers on the platform.

“Merchants on the Uber Eats app have the ability to determine their own pricing for diverse items from their stores available to consumers on the platform,” the Uber spokesperson said.

“We are dedicated to supporting small restaurants as well as enterprise players through partnerships that focus on providing access to the Uber Eats marketplace and critical training and resources.”

Mr D also stressed that restaurants on its platform maintained control over setting their prices.

It highlighted some of the initiatives aimed at bolstering the success of restaurants on the Mr D app, such as the Mzansi Trailblazers programme.

This initiative benefits Mr D’s Historically Disadvantaged Partners (HDPs), which are businesses that have faced historical barriers due to factors like ownership, independence, or size.

“We also support female-owned businesses, where women hold more than 50% ownership and are typically independent or smaller in size,” Mr D said.

Markups around 21–33%

MyBroadband compared the prices of various popular food items from well-known restaurants and takeaway chains when choosing the delivery option on Mr D and Uber Eats with their prices when bought in person or directly from the outlet.

We found the markups on three products from six restaurants — McDonald’s, Nando’s, Roman’s Pizza, Rocomamas, and Simply Asia — were generally between 21% and 33%.

For the most part, the product prices on Mr D and Uber Eats were the same.

People who feel these prices are too steep might want to consider ordering directly from the restaurants.

McDonald’s, Nando’s, Roman’s Pizza, and Simply Asia offer their own websites and apps from which you can order products at their in-store prices.

While in-house delivery fees might be higher than those of Mr D or Uber Eats, the product price markups on the two third-party services can easily exceed that amount if multiple items are ordered.

For example, if you were to buy a BBQ Chicken Sava Flava large pizza and a large Tangy Russian Pizza from Roman’s Pizza, these would cost R219.80 with R35 delivery on Roman’s in-house app.

On Uber Eats, the same order would cost R230.80 before the delivery and service charges are added.

The main difference between using in-house and third-party on-demand services is that the latter aggregates all the stores together and makes delivery possible from smaller restaurants that don’t offer this on their own platforms.

The table below compares the in-store product prices of six popular restaurants with their prices on Mr D and Uber Eats.