Before the COVID-19 pandemic, Ivy and Coney had limited experience with pick-up and delivery. If you wanted a Detroit or Chicago-style hot dog paired with a cold beer, you had to order it at the Shaw bar. Owners Chris Powers, Adam Fry, and Josh Saltzman gave Grubhub a test drive, but say the fees involved made for unsustainable business.
Fed up with the roughly 30 percent commissions third-party apps like Grubhub, Postmates, and Uber Eats typically charge, the trio developed their own pick-up and delivery platform, DC To-GoGo. It aims to keep more money in the hands of bars and restaurants in search of reliable revenue streams.
Shaw Main Streets, a nonprofit commercial revitalization and historic preservation organization funded in part by the D.C. government, gave the bar owners a grant to get their hyper-local project off the ground. DC To-GoGo will slowly roll out this week with a slate of participating Shaw restaurants and bars. The founders will then look to expand to other parts of the District.
DC To-GoGo charges a nominal administrative fee of 5 to 15 percent per order. Initial revenue will go toward further app development and staff salaries, but once the client base expands and operating costs decrease, the founders say they’ll redistribute profits to their bar and restaurant members, as well as charities benefitting the hospitality industry.
There are three tiers of membership, two of which will be available from the beginning. The first is for establishments that only want to offer pick-up. DC To-GoGo provides an online payment portal and the ability to schedule pick-ups, and takes 5 percent per transaction.
The second asks restaurants and bars to hire their own drivers to do delivery. DC To-GoGo’s vision is for businesses to rehire their laid-off workers as couriers, though there currently isn’t any funding to provide these employees with transportation if they don’t already have it. Restaurants in this scenario set their own delivery radius. DC To-GoGo takes 10 percent per transaction.
When it eventually launches, the third membership tier will give restaurants and bars access to DC To-GoGo’s fleet of trained delivery drivers so they won’t have to hire their own. In this scenario, DC To-GoGo keeps 15 percent per transaction, plus delivery fees.
DC To-GoGo also aims to be a good deal for drivers. Delivery is a stressful job that comes with all kinds of obstacles like unpredictable wages, parking tickets, and bad weather. D.C. Attorney General Karl Racine sued DoorDash late last year over the way they were paying their employees and “deceiving consumers” about where their tips were going.
Bars and restaurants using DC To-GoGo are asked to guarantee drivers $18 per hour for a fixed and reliable number of hours per week. Drivers can earn tips on top of their base hourly pay. It will be challenging to enforce how much drivers are paid in the tier where restaurants hire their own drivers, but the founders are counting on DC To-GoGo participants to share their values.
“What we hope is people who are partnering with us are interested in serving the restaurant community at large,” Fry says. “The idea that we’re all working together to provide living wages for all of our employees from couriers to line cooks to the front-of-house worker—everyone deserves to make a living wage. Part of partnering with us is that you’re going to work toward that mission as well.”
DC To-GoGo hopes to fix some other aspects of the to-go business that have irked restaurants, including a lack of control and professionalism. “Working with a third party, you never know when [drivers] are going to show up,” says Powers, whose professional background is in the kitchen. When Ivy and Coney experimented with Grubhub, they sometimes struggled with the volume of sales. “It was the most overwhelmed I’ve been in a kitchen since the first time I worked the sauté station on a brunch shift,” Powers says. “With order flow, we have to figure out a better way.”
If laid off restaurant workers become couriers, the founders believe they’ll bring the same level of hospitality to delivery that diners expect when they sit down in dining rooms. Once DC To-GoGo starts hiring and training its own fleet of drivers, they expect to have a mix of former restaurant workers and couriers coming over from other companies.
Customers who place orders on the DC To-GoGo website will know that the restaurants listed on the online marketplace are indeed open and offering take-out and delivery. Some third-party apps are known to add restaurants to their platforms without permission and posting menus that aren’t up to date.
The launch of DC To-GoGo comes as the D.C. Council passed legislation instituting a 15 percent commission fee cap on third-party apps, joining San Francisco and Seattle. It also prohibits companies from slashing drivers’ earnings or garnishing their tips.
Fry says he anticipates there will be continued pushback from companies like Grubhub, despite their record earnings. He worries third-party services could pass new fees onto diners or limit their delivery ranges. DC To-GoGo was built to be sustainable for restaurants, diners, and drivers at its current rates, according to Fry.