A new report has warned of the importance of making sure that a restaurant’s delivery drivers are treated equally and making even tips.
Paytronix’s “No trip, no trip” report notes that drivers not getting their fair share of tips could become a blow to a restaurant’s bottom line through unclaimed orders.
While delivery drivers have been recognized as key workers over the course of the pandemic and the large-scale shift towards off-premises dining as a key revenue channel, a debate about the merits of tipping still rages.
Some consumers and industry observers suggest that tipping culture needs reevaluating, some restaurants are abandoning tips altogether and instead rolling them into menu prices, while other continue to defend tipping as vital for the industry’s workers.
Now, the Paytronix report has found that there is a strong correlation between the lack of a tip and the percentage of orders not picked up.
The data found that 2.6 per cent of delivery orders with no tip or a tip of less than 50 cents were not picked up. Moving up the scale, on average, about 0.9 per cent of orders with a tip over $2.50 are not picked up, and as tips become larger, that total drops to around 0.7 per cent.
Variations occur by region and also depending on factors such as the price of fuel, as drivers are less inclined to pick up orders when the tip wouldn’t offset the money spent on gas.
Encourage tips, cut costs
Using the right data, a restaurant can determine how much these unclaimed orders are costing the brand or individual locations, and corrective action can be taken to reduce loss.
If an analysis shows that a large number of orders aren’t picked up at some or all of a restaurant’s locations, a simple solution is to encourage tips for delivery orders.
Paytronix research indicates that an average of 73 per cent of delivery orders contain a tip, so most delivery drivers and customers accept that a tip is expected. With that in mind, the report recommends that restaurants should encourage tipping through messaging in the checkout section to drive enough in gratuities to decrease costly undelivered orders.
The correlation between tipping and delivery fulfillment is likely to continue, particularly if fuel costs remain at the levels seen in the first half of 2022. Once a restaurant identifies problem locations, taking advantage of messaging capabilities in digital platforms and apps will go a long way towards ensuring that delivery drivers are tipped and orders make it out the door.
