Food delivery revenue splitting formula among rider-owner-agent

Fig. 1 Grab food is answerable to its investors. It is not a social enterprise with capital procured from the public.

First, the owner gets 70% of its sales (FULL STOP). For example, if owner sold $27, it gets $18.90. Grab ensures order and delivery.

The rest is about Grab’s charges to CUSTOMERS (FULL SOP).

Grab charges extra on customers. E.g., $27 + $3 = $30 (listed price). Then service fee at $11.50 (depending on distance), which is 38% of listed price.

Rider gets $8.50 (assumed, ref 1). Grab gets $41.50 – $18.90 – $8.50 = 14.10. In terms of revenue distribution, it is a 20-45-35 formula of the last pricing of $41.50.

In this arrangement, owner still gets 70% of earning, e.g., $18.90. Grab coordinated with other stakeholders, namely customers, riders, and stall owners to earn $14.10. Rider received $8.50 per trip (assumed, ref. 1). This arrangement is still good because without Grab, stall owner gets zero.

Grab is not a social enterprise and it needs to pay investors. Investors had pumped capital into Grab.

Lastly, disgruntled stall owners can opt out if they think Grab is a bane than a solution.

Else, stall owners can coordinate among themselves to incorporate their own food delivery services for themselves. This would be similar to the extra service charges they pay to stall associations to get their plates washed…

Reference

  1. Grab allegedly pocketed 50% off the cost of a food order made over Grabfood. What happened here? (https://mothership.sg/2020/04/grabfood-commission-rate-explained/)

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