For many food and drink operators, delivery and booking platforms are now integral to everyday trading – driving orders, bookings and visibility.
That’s the upside. The trade-off is that convenience rarely comes cheap. These apps can quietly squeeze margins, blur control and put more distance between you and your customers.
As the platforms have grown, so has their leverage. In many cases, they set the terms and control the customer relationship, while the operator carries the bulk of the risk.
That doesn’t mean businesses should avoid them. It just means their terms and operating practices are worth looking at properly.
These are the areas to check if you’re already using or want to use a delivery or booking platform:
Delisting and suspension
Most platforms give themselves broad rights to suspend your account or remove your listing because of complaints, operational issues or alleged breaches of platform rules, sometimes for matters that are minor or disputed.
App providers can shut you down for a host of reasons, sometimes with little warning. If you rely heavily on one platform, that is a serious revenue risk.
- Practical tip: be clear on what can trigger a suspension and keep an eye on those pressure points.
Refunds and chargebacks
Refund terms matter because they hit margin directly. In most cases, the platform decides when a customer gets a refund and who ends up footing the bill (usually the operator).
Restaurants often end up funding those refunds through deductions from future payments. One or two may not hurt; but eventually they will.
- Practical tip: keep a simple log of refunds and challenge them quickly where needed.
Fees beyond commission
Many operators focus on the headline commission rate, but that is often only part of the cost.
Service fees, payment charges, promotional spend and other deductions can soon eat into real profit. The commission rate may look manageable on paper, but the actual margin can tell a different story.
- Practical tip: work out the true margin on each order or booking, not just the commission rate.
Brand control and IP
When you upload menus, photographs and brand assets, you’re giving the platform a licence to use that content.
That can include the right to edit, reformat or reuse it in the platform’s own marketing, even after you’ve left the platform.
- Practical tip: check how far those usage rights go and whether they continue after the relationship ends.
Customer data
Customer data is one of the most valuable assets in the platform economy. Because the platform often owns the customer relationship, you may get limited customer information and little chance to market to those customers directly.
Meanwhile, the platform can use aggregated data to strengthen its own position.
- Practical tip: keep building direct channels, whether that’s your own website, a customer database or your email marketing list.
Reviews and reputation
Ratings and reviews are fundamental to how you’re perceived by potential customers. A weak score can hurt conversion as well as your ranking on
the platform.
It is also an area of growing legal scrutiny, with UK rules targeting fake or misleading reviews recently coming into force.
- Practical tip: keep an eye on ratings and challenge reviews that look fake, misleading or simply wrong using the platform’s own escalation processes.
The terms will change, and usually without warning
Many platform agreements allow unilateral updates to their terms on limited notice. So, the deal you sign is not always the deal you are still working under six months later.
Those changes can affect fees, operating requirements, refund rules and promotions, with a direct impact on profitability.
- Practical tip: give someone clear ownership of platform updates so changes are spotted early.
Platforms can bring reach and convenience, but they can also chip away at margin, brand control and resilience if you don’t have a good handle on their terms and act accordingly.
The point is not to avoid platforms, but to use them with your eyes open. Before signing up or renewing, it is worth asking:
- Do you understand the full cost, not just the headline commission rate?
- Are you managing the risks around refunds, ratings, listings and service levels?
- Are you still building direct customer channels as well, or relying too heavily on someone else’s app?
For many hospitality SMEs, they now play a pivotal role in generating revenue, improving visibility and improving consumer access. Platform agreements deserve the same attention as any other meaningful commercial contract, so don’t skip the small print.
Miles Barnes specialises in advising businesses in the food and drink sector. Contact Miles
at miles.barnes@howespercival.com or visit our website here.
