EconomyThailand

DIT chews on regulations to lower food delivery service fees

PHOTO: Food delivery services offer Covid-19 discounts to vendors after DIT pushes. (via Flickr - Dennis Sylvester Hurd)

After pressure from the Department of Internal Trade, food delivery services in Thailand will lower their rates to aid struggling food vendors during Covid-19. Restaurants have been complaining about the high commissions that food delivery services like Food Panda, Gojek, Grab, and Line Man charge restaurants, typically taking a 30% bite out of profits. The DIT has requested that food delivery services lower their slice of the pie to 15%.

When Covid-19 first swept the world, many countries including Thailand went into lockdown. Restaurants were closed, dining in was forbidden. Often restaurants were kept afloat by the increased online ordering from people staying home to avoid Covid-19, and for many restaurants, food delivery services became their bread and butter. But as the pandemic months stretch on and the economy and tourism are still flat as a pancake, restaurants are in a pickle struggling to survive when so many of their orders are via costly delivery services.

It is rumoured that the DIT is pushing for a regulating law that sets a cap on the commission these food delivery services can charge, but last month they called a meeting with the companies to butter them up into voluntarily lowering their rates. A California law that limits online food delivery commissions to a maximum of 15% during Covid-19 was served up as food for thought.

Gojek has agreed to discount rates, but at a rate that might be small potatoes compared to the DIT’s 15% request. They are allowing food vendors to either receive a 5% discount on fees or pass it along as a saving to their customers to sweeten the deal and boost sales. The special runs for the whole month of June and Gojeck are offering 15-20% discounts on orders for vendors who register before May 30.

Line Man food delivery service has offered the same 5% discount, but only for food vendors in Bangkok, Nontha Buri, Pathum Thani, and Samut Prakan who sign up by June 1. Grab Thailand, whose food delivery services have become a gravy train while rideshares are down due to the pandemic, also announced plans to work with the DIT to make a similar discount program in June for local merchants paying over 25% commission.

While none of the food delivery vendors matched the DIT’s 15% discount request, the small crumbs of 5% discounts can still help small food vendors bring home the bacon, at least until official regulations are drafted and implemented.

SOURCE: Bangkok Times

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Neill Fronde

Neill is a journalist from the United States with 10+ years broadcasting experience and national news and magazine publications. He graduated with a degree in journalism and communications from the University of California and has been living in Thailand since 2014.

3 Comments

  1. “While none of the food delivery vendors matched the DIT’s 15% discount request…”

    A perfect example of how much respect the regulatory agencies garner these days. Zero.

    Damn the people, full profits ahead…

  2. my niece signed up to a popular online delivery they charge up to 35% commission including local taxes, how obscene, greedy people.the plot is to service new accounts for a couple of months,them move on to the next new food seller and so on ?

  3. Use Tuk app. Available in bkk and Chiang mai. They take 5% they scoop up grab drivers who are sitting around who already don’t make much and the delivery fee is very small.

    I don’t think this is a place for govt but rather free market competition.

    The apps exist, the drivers exist, the vendors exist, the discounts exist, now they just need customers to use the app.

    USE TUK. quit giving price gougers your money.

    Should be pretty straightforward.

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