May 23, 2020, 10:31 AM
If you don't already know, ordering food online and having it delivered is much more expensive compared to buying it directly from a business.
How much more expensive exactly?
Facebook user Leron Heng has managed to demonstrate that in this nifty side-by-side comparison:
Credit: Leron Heng/Facebook.
Heng wrote in her post:
"Difference between buying at the physical stall and ordering through Grabfood? Lollll. FYI, I've yet to order any online delivery since the start of CB. Pretty surprise a lot of ppl didn't know online ordering of dishes are generally more expensive. But during this CB they are even steeper, so..."
Merchant marked up online price by up to 61 per cent
Two identical orders — one ordered from the shop directly while the other was made via GrabFood — yet the latter was more expensive.
The GrabFood order cost S$53.60 — S$18 more than the one ordered directly from the shop (S$35.60).
Taking into account the service fee in the GrabFood order, the price of the meal went up to S$60.70.
Here's a comparison of the prices:
- Pad Thai (S$6 vs S$8.90)
- Basil Rice (S$6 vs S$8.90)
- Seafood Tanghoon Salad (S$10 vs S$14.90)
- Green Curry (S$8 vs S$12.90)
- 2x Thai Green Milk Tea (S$5.60 vs S$8)
The markups in the GrabFood order above range between 43 per cent and a whopping 61 per cent.
Markups in pricing on the GrabFood platform are set by merchants.
Grab imposes a 25 to 30 per cent commission on the order value. This, says Grab, goes into covering its costs as well as any additional incentives for riders.
43 per cent mark up is reasonable
A 43 per cent mark up is actually reasonable because then the merchant will not be shortchanged.
Take the S$10 Seafood Tanghoon Salad as an example.
In order to earn S$10 from it on GrabFood orders, the merchant will have to sell it for S$14.90.
This is so that after Grab takes a 30 per cent commission (S$4.30), the merchant is still able to receive S$10 for the salad.
On the other hand, a 61 per cent mark up doesn't seem that reasonable.
The question then for customers is whether the markup on online food orders is really worth the convenience.
Top image credits: Leron Heng/Facebook and a generic image of Green Curry from Taste.au (for illustrative purposes only).
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