Image provided by: University of Oregon Libraries; Eugene, OR
About The Bulletin. (Bend, OR) 1963-current | View Entire Issue (Jan. 10, 2021)
C8 THE BULLETIN • SUNDAY, JANUARY 10, 2021 Grubhub drivers say app change eats into tips, jeopardizing a usually generous season BY SUHAUNA HUSSAIN Los Angeles Times A recent tweak to the food delivery app Grubhub that changes the way customers are prompted to tip delivery drivers has frustrated many workers, who say the change discourages tipping and is slashing their potential earn- ings. Popular food-delivery apps typically allow customers to tip drivers a percentage of their meal’s cost, with the default tip often ranging from 10% to 25%. Grubhub switched from that model Dec. 16 when the Chicago company rolled out new fees for customers in Cal- ifornia to help cover the costs of driver benefits granted by voters in the state last month. The app now defaults to zero, or no, tip. A new message also appears atop the prompt, saying cus- tomers may “Leave an optional tip on top of Driver benefits.” Drivers said the change is cost- ing them and offsetting any gains from the newly added benefits. On Christmas Eve, Los An- geles driver Audrey Wilson, 55, crisscrossed the city deliv- ering meals, earning $1 or so on most orders, she said. A $10 tip from a resident of a pala- tial home just off Mulholland Drive was one of her biggest that night. Wilson had recently re- started driving for the service after a months-long break. Be- cause of the change in tip pol- icy, she said, she plans to switch to a competitor, the food deliv- ery platform DoorDash. “I was digging the work. I got to make my own hours,” Wilson said. “But now it’s rare to get a tip over a dollar. It’s un- believable.” She estimates she now makes 30% to 50% less daily than she did months be- fore. Grubhub spokeswoman Ka- tie Norris said that California drivers for the platform are making 20% higher pay per or- der, including tips, since Prop- osition 22 came into effect, and that app users can still choose to leave a tip for their driver. Proposition 22 — bank- rolled by Uber, Lyft and other gig economy companies — won gig companies a carve- out from a state labor law that would have required them to classify their workers as em- ployees and offer a full slate of benefits. As a concession to workers, the ballot measure outlined some new benefits, including a minimum earnings guarantee and a health care sti- pend for drivers who clock in a certain number of hours on the road. Ride-hailing and food-deliv- ery platforms have since added fees to cover the cost of the new benefits: Grubhub added a flat fee of $1.50 per customer order. The company’s mar- keting language draws a link between the new fee and sug- gested tipping practices. “In support of California’s Prop. 22, this payment helps guarantee minimum wage and healthcare benefits for our drivers so they don’t have to depend on tips,” reads a note on the app under an informa- tion tab explaining the new driver benefits fee. Rival DoorDash slightly in- creased service fees for some California orders to fund new driver benefits, said DoorDash spokesperson Taylor Bennett. The company is also consid- ering changes to some pro- motions such as DashPass, a subscription service that offers unlimited deliveries for a fee, that may also affect the price for some customers. Solve these puzzles on C4 SOLUTION TO TODAY’S SUDOKU Uber spokesman Davis White said additional fees for customers of the ride-hailing giant will vary depending on the city. For example, since Dec. 14, each Uber Eats food delivery order has risen by 99 cents in Los Angeles and $2 in San Francisco. The company has also tacked fees of 75 cents in Los Angeles and 30 cents in San Francisco on to rides, with the additional charge rising to $1.50 in more sparsely popu- lated areas. Gig economy companies have largely struggled to turn a profit, first as startups and increasingly as publicly traded companies. Proposition 22 saved them the costs of over- hauling their approach to labor in California, a huge market. Grubhub remains one of the few that had become prof- itable, and yet this year the company lost money — even during the pandemic, when food delivery became a more common habit because of restaurant dining restrictions. In June, European food deliv- ery service Just Eat Takeaway agreed to buy Grubhub for $7.3 billion, a deal that will give it a foothold in the U.S. SOLUTION TO TODAY’S JUMBLE NYT CROSSWORD SOLUTION LAT CROSSWORD SOLUTION Fragile pr pretty well.” When businesses were re- op opened in mid-May, through D December the business re- bo bounded. The first quarter is tr traditionally slow and Dunlavy ha hasn’t paid herself for more th than a year. “I put it all back into the ga gallery,” she said. “We could ha have closed if I hadn’t had this at attitude about taking care of th the people who will take care of the gallery. To me the Red C Chair Gallery is the artists. Pe- ri riod. It’s not how it’s run, but ho how to make a good place for th the artists to be.” Continued from C1 For other businesses, the past 10 months haven’t been so smooth. Surviving the pandemic takes grit, wrote Carrie Dou- glass, owner of The Haven co-working space wrote in her blog. To get through the shutdowns and the downturn in business, Douglass wrote that she honed her mission, reached out to her members, en sought out investors, and even sold her home to keep afloat. “Starting a small business is always risky, and we knew that, but we obviously didn’t foresee an international pandemic and sweeping business restrictions,” Douglass wrote. “The reality is that this pandemic likely set us back at least a decade or more. “We share this because it’s important for people to under- stand the real risks of entrepre- neurship.” Down the road at the Box Factory on SW Industrial Way, Nickol Hayden-Cady, owner of Foxtail Bakery, has hit the wall financially and has put her business up for sale. She plowed through the Pay- roll Protection Program funds. She maxed out her credit cards. And she has ran up as much debt as she could to keep her business going. But without weddings, events or lunchtime patrons, it was im- possible to pay a staff, the rent and the other expenses she in- curred running her bakery and restaurant. Now she and her mom, who is also her partner, are the only ones working. They’re taking orders for cakes and pies. “We closed down. We’re done,” Hayden-Cady said. “The whole problem is we’re losing thousands of dollars a day. We put everything into this without losing our house.” No one could have pre- dicted a pandemic, or one that would have forced the closure of dine-in restaurants, physical distancing and limited custom- ers. At the Small Business De- velopment Center, instructors often advise businesses to have eight to 16 months of cash re- serves on hand to weather a downturn, a catastrophic event like a hurricane, or a pan- demic, or something that cre- ates an economic shock, said Ken Betschart, director of the Small Business Development Center at the Central Oregon Community College. The pandemic has hit in- dustries differently, Betschart said. Some have succeeded and grown. Others have stumbled and closed. And some have taken this time to be a catalyst for change by taking classes, assessing their finances and de- veloping a business plan. “The restaurant industry or the travel and tourism indus- try is hurt because the econ- omy doesn’t work on take-out alone,” Betschart said. “It’s a di- vided economy.” Nickol Hayden-Cady stands in her bakery, Foxtail Bakeshop at 735 NW Columbia St ., in 2017. ý Reporter: 541-633-2117, sroig@bendbulletin.com Ryan Brennecke/The Bulletin file The Small Business De- velopment Center offers 15 classes for business owners, most are filled and are short term. Since the fall the enroll- ment in these classes has been up, Betschart said. “Financials are the window into your business,” Betschart said. “You have to be able to see where you can cut costs and where you can shift your re- sources.” Entrepreneurs are hopeful by nature and will go to ex- treme lengths to protect their business, said Adam Krynicki, Oregon State University-Cas- cades Innovation Co-Lab exec- utive director. “The failure of a business is not just an entrepreneur’s problem,” Krynicki said. “It’s an Oregon-wide problem. These entrepreneurs are doing ev- erything they can to support themselves, their families and their employees. It’s up to all of us to do everything we can to help them survive.” Hayden-Cody said she feels like she achieved her goals during the last three years cre- ating and growing the Foxtail Bakery. Before the pandemic started in March she was look- ing forward to even growing to a second location, creating a cookbook and catering for weddings. She went from 300 or 400 customers a day to 15 during the height of the pan- demic-related restrictions. “We had 100 brides switch from 2020 to 2021 and now they’re starting to cancel 2021,” Hayden-Cody said. “It’s just so sad.” At the Red Chair Gallery, Dunlavy realized she needed to maintain the space for the artist members because with- out artists, there is nothing for customers to buy. The business model relies upon the artists to pay their rent and share a por- tion of their sales when they sell something. So far, all but two of the 30 artists stayed. “I have a business back- ground, and I fell into the art part part after I retired from the business world,” Dunlavy said. “That has saved the day for us.” When businesses were shut- tered for six weeks early in the pandemic, Dunlavy’s goal was to always show activity through the windows of the downtown shop. At the same time she eliminated all non-es- sential costs and projected the budget out for a year. “I always try to be happy to see customers,” she said. “We wanted to keep the idea that art is joyful. That worked Join Us For A Virtual Tour WE ARE RENTING! Proudly Providing ENT Care for our community Since 1970 We are Central Oregon’s premier providers for ear, nose, and throat and hearing care . SAME-DAY APPOINTMENTS AVAILABLE FOR: • Ear/sinus issues • Vertigo episodes • Earwax removal • Abscesses • Nosebleeds • Hearing test • Allergy consultation • Telehealth appointments 541.526.1479 NO REFERRALS NEEDED!* Central Oregon Ear, Nose & Throat is excited to announce same-day appointments available! Myra Baker, PA | Physician’s Assistant Whether the search is for a short-term respite stay or a long-term living option, we invite you to visit Regency Village at Bend and experience our commitment to bringing independence to living and quality to life. Schedule your virtual tour today! CALL NOW! Bend | 2450 NE Mary Rose Pl, Ste 120 Redmond | 1020 SW Indian Ave, Ste 102 541-317-3544 COENT.com | *Call for details 127 SE Wilson, Bend