Do Restaurants Make Money on DoorDash? The Real Numbers Revealed

The promise of third-party delivery seems irresistible: access to millions of customers, no upfront costs, and orders flowing in. But behind the app's sleek interface lies a financial reality that's bankrupting restaurants across America.

TL;DR

Most restaurants lose money on every DoorDash order when you factor in all costs. The average restaurant pays 25-30% in commissions, plus hidden costs that can push total delivery expenses above 40% of order value. Only restaurants with margins above 35% before delivery can potentially profit.

The True Cost Breakdown

Direct DoorDash Fees

Let's start with what DoorDash charges directly:

| Fee Type | Percentage | On $30 Order | |----------|-----------|--------------| | Basic Commission | 15-30% | $4.50-$9.00 | | Marketing Fees | 0-6% | $0-$1.80 | | DashPass Fees | Additional 2-3% | $0.60-$0.90 | | Payment Processing | 2.9% | $0.87 | | Total Direct Fees | 20-42% | $6-$12.60 |

Hidden Costs Nobody Talks About

But wait—there's more. These hidden costs eat into your margins:

1. Packaging Costs

• Average packaging per order: $0.75-$2.00
• Delivery-specific containers (leak-proof, insulated): $1.50-$3.00
• On a $30 order, that's an additional 5-10%

2. Tablet & Integration Fees

• Monthly tablet subscription: $50-$150
• POS integration fees: $100-$300/month
• Tech support and maintenance: $50+/month

3. Labor Inefficiency

• Staff time managing orders: 5-10 minutes per order
• At $15/hour, that's $1.25-$2.50 per order
• Order mistakes and remakes: Add 2-5% of orders

4. Refunds Charged to Restaurant

• Missing items (even when packed)
• "Never delivered" claims
• Customer disputes: 3-5% of orders

The Real Math: A Case Study

Let's analyze an actual $30 DoorDash order for an average casual restaurant:

| Item | Amount | % of Order | |------|--------|-----------| | Order Value | $30.00 | 100% | | Food Cost (30%) | -$9.00 | -30% | | DoorDash Commission (25%) | -$7.50 | -25% | | Marketing/Boost (3%) | -$0.90 | -3% | | Payment Processing (3%) | -$0.90 | -3% | | Packaging | -$1.50 | -5% | | Labor (order handling) | -$1.75 | -6% | | Tablet/Tech Fees (per order) | -$0.50 | -2% | | Refund Reserve (4%) | -$1.20 | -4% | | Net Profit/Loss | -$3.25 | -11% |

That's right—this restaurant LOSES $3.25 on every $30 DoorDash order.

When Does DoorDash Make Sense?

The Break-Even Analysis

To profit on DoorDash, you need:

• Food costs below 25%
• No marketing/boost spending
• Minimal tablet fees
• Extremely efficient operations

Reality check: Fewer than 15% of restaurants meet these criteria.

Where Restaurants Go Wrong

1. Using DoorDash as Primary Revenue Some restaurants now get 50-70% of orders through apps. With negative margins per order, they're literally paying customers to eat their food.

2. Participating in Promotions "Get 25% off your order!" sounds great for customers. But restaurants fund 50-100% of these discounts, on top of existing commissions.

3. Boosting for Visibility DoorDash's algorithm buries restaurants that don't pay for visibility. The "boost" fees (6-25%) make an already unprofitable order even worse.

4. Ghost Kitchen Fallacy "Lower overhead = profit on delivery!" Wrong. Ghost kitchens still face 25-30% commissions. Without dine-in to absorb fixed costs, many fail within 18 months.

Real Restaurant Testimonials

Mario's Italian Kitchen, Chicago

"We did $80,000 in DoorDash sales last month. Sounds great until you realize we lost $6,400 on those orders. That's money out of my pocket to feed strangers."

Thai Spice, Seattle

"I calculated every cost for a month. On $50,000 in app orders, we made $200. That's a 0.4% margin. My savings account pays more."

Burger Joint, Austin

"We turned off DoorDash for 3 months. Revenue dropped 30%, but profit increased 15%. Let that sink in."

The Alternative: Direct Ordering

What if you could capture online orders without giving away 30%? Here's the comparison:

| Metric | DoorDash | Direct Ordering | |--------|----------|-----------------| | Commission | 25-30% | 0% | | Marketing Fees | 0-6% | 0% | | Payment Processing | 2.9% | 2.5-2.9% | | Monthly Fee | $0 | $100-300 | | Customer Data | No | Yes | | Brand Building | No | Yes | | Effective Cost per $1,000 | $300-400 | $25-30 |

The Math on Direct Ordering

On that same $30 order with direct ordering:

| Item | Amount | % of Order | |------|--------|-----------| | Order Value | $30.00 | 100% | | Food Cost (30%) | -$9.00 | -30% | | Payment Processing (2.5%) | -$0.75 | -2.5% | | Platform Fee ($0.50/order) | -$0.50 | -2% | | Packaging | -$1.50 | -5% | | Labor | -$1.75 | -6% | | Net Profit | +$16.50 | +55% |

That's a $19.75 difference per order!

How to Transition Away from DoorDash

Step 1: Set Up Direct Ordering (Week 1-2)

• Commission-free ordering system
• Integrate with your POS
• Design pickup/delivery zones

Step 2: Price Strategy (Week 2-3)

• Keep DoorDash prices 15-20% higher
• Offer 10% discount for direct orders
• Create loyalty rewards for direct customers

Step 3: Marketing Transition (Week 3-8)

• Add QR codes to all packaging
• Email blast to existing customers
• Social media campaign: "Order direct, save more"

Step 4: Reduce DoorDash Dependence (Month 2-6)

• Remove promotions on DoorDash
• Limit menu on third-party apps
• Focus marketing on direct channels

Step 5: Evaluate & Optimize (Ongoing)

• Track order source and profitability
• Adjust direct ordering incentives
• Consider fully exiting apps

The Bottom Line

DoorDash profitability is a myth for most restaurants. The math simply doesn't work:

• Average restaurant margin: 3-9%
• DoorDash effective take: 35-45%
• Result: Negative profit per order

Your Action Items

1. Calculate your true DoorDash profitability including all hidden costs
2. Set up a direct ordering system immediately
3. Create incentives for customers to order direct
4. Gradually reduce third-party dependency
5. Monitor and adjust based on real data

The restaurants surviving the delivery economy aren't the ones with the best DoorDash reviews—they're the ones who've figured out how to make customers order directly.

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