5 Reasons Why Postmates Are So Expensive?

Postmates is one of the USA’s leading food and grocery delivery services, covering more than 189 cities across the country. It is the first priority of thousands of Americans to get food and goods because of its fast and reliable service. But many people are often found complaining about the high prices they have to pay when they order something using the Postmates app.

If you are here, then it means you also feel the app is costly and want to know the reasons why Postmates is so expensive. Well, don’t go anywhere as we are describing the top 5 reasons behind this here. As a bonus, we are also describing the top ways you can opt to save some money when you order using the Postmates app.

So, let’s begin!

5 Reasons Why Postmates Is Expensive

When compared with other food or delivery services, Postmates is often found costly. Here are the top reasons behind this:

1.   Postmates Charges Restaurants

One of the biggest sources of revenue for Postmates is the money charged from the restaurants. Restaurants are not listed on the app randomly by Postmates. They pay a fee to be included there as the app is providing them a platform, allowing them to reach a wider base of customers.

The restaurants make up for the fee they pay by increasing the food prices.

Wondering, how much do restaurants pay?

Well, Postmates charge roughly between 15 to 30% of the order. That is why it makes sense why food is 10-20 percent higher on apps than dine-in.

Also, the restaurants pay another fee if they use the “Direct Bank Deposit” option. This fee ranges from 0.8 to 5$.

That’s not it either.

The restaurants also pay 5$ fee for tablets and hardware rentals.

However, the Postmates Partner restaurants do not have to pay for tablets & hardware rentals and for processing too. This saves around 3 to 6 percent on fees every month.

3. High Fees For Different Things

Another reason why Postmates is expensive is because of its high delivery, service, small cart, and cancellation fee.

The delivery fees of Postmates vary depending on which restaurant you are ordering from and how much distance the driver has to cover to deliver your order. The longer the distance, the more the delivery charge.

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If you are ordering from fast-food chain restaurants, the delivery fee may vary from 2.99$ to 9$. But if you are ordering from Postmates’ merchants, then the delivery fee is low.

Now, let’s discuss service fees.

Postmates also charge service fees, and quite rightly so. It gives you great relief by handing over the food or goods to your doorstep. So, it really deserves it.

The service fee varies depending on your locality and the restaurant you ordered from. Generally, it is between 2.99$ to $10.

Moreover, Postmates “punishes” you by charging a small cart fee if your order is less than 12$. This is applied to encourage the users to add more items to the cart to reach the 12$ limit.

The small cart fee is fixed, which is 1.99$. So, it is commonly believed that Postmates is for those who have to order something expensive.

Also, what if your mood changes and you no longer feel the appetite to eat what you order? Or what if you have an emergency and have to go somewhere immediately? You will most probably cancel the order in these situations. Postmates also charges Order cancellation fees.

3. Postmates Wants To Give Some Benefits To The Independent Drivers

The State of California passed the Proposition 22 law, which caused Postmates to raise prices in the state. In this, the state declared the drivers as individual contractors and not the employees.

After its passage, Postmates increased the cost in the state as the company wanted to cover the benefits of drivers in this price range without hurting its available resources. That is why Californians think Postmates is a costly option to get food and groceries.

4. Blitz Pricing

If you use Uber frequently, you must know about “Surge price.” It is the pricing method in which the price of fare increases during peak hours.

Well, it’s the same when you use Postmates. But the phenomenon is called “Blitz Pricing.” 

When the peak times hit, the price may even double up sometimes. So, it is important to first see the total amount at the time of checkout to avoid any embarrassing situation.

Generally, the Blitz pricing happens during the last three days of the week (Friday, Saturday, Sunday) and weekday lunch.

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5. Sales Tax Is Also High When You Order from Postmates

We already mentioned that the restaurants charge more on Postmates to cover the fees of the app. However, this charging is not limited to the food only. You will also have to pay a high sales tax with it as well.

For example, When you order a Family Feast on Postmates which is worth 45$ on the app, the sales tax will be around 4$. But when you go to the restaurant, it is only 39$, and the sales tax is 3.30$.

After knowing why Postmates is expensive, it is time for your bonus.

How To Make Postmates a Little Cheaper?

If you earn minimum wage or just want to save money, then you should know some ways to get things at a cheap rate.

Here are the tips and tricks you can use to save some bucks when using Postmates:

1.   Become an Unlimited Member

One great scheme Postmates offers is “The Unlimited Membership Program.” If you enroll in this, you can save your hard-earned money while having food and goods delivered to you.

How?

When you join this program, you can enjoy free delivery on:

  1. Foods worth 15$ or more.
  2. Groceries worth 30$ or more.
  3. Any item(s) worth more than 20$ from the “Favorite section.”

But that’s not it.

When you order, you will also be charged 5 percent fewer service fees too. You will also get 10% off on three uber rides every month until the subscription lasts.

On top of this, Postmates also offers a number of other benefits too, like giveaways, discounts, deals, etc., regularly.

You will only have to pay 99$ per year or 9.99 every month to enjoy all of these luxuries. Furthermore, if you want to discontinue the service, just log in to the app and change the setting from “auto-renewal” to “off.”

2. Use Promo Codes

Promo codes are like little treats, aren’t they? When signing up on Postmates for the first time, the app gives you promo codes worth 100$ on your initial orders. So, if you know someone who hasn’t used Postmates yet, then let them know what they are missing.

How about you also earn some benefit for yourself for doing this favor? Postmates offers 25$ credits if you refer a friend by using the link the app provides.

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Moreover, when your order is an hour later, Postmates add 15$ credit to your account. So, your order getting late might not be a totally bad thing. However, you can enjoy this credit only once a month.

3. Do Not Order During Peak Times

One simple way of keeping the total price of an order down is by not ordering during the peak times. Paying 1.5 times more for something that stays less for the most part of the week may seem a little unjust. But that’s how the economy works. Peak times are the busiest hours. During this time, the companies extract the maximum benefits. Thus, how about how you make such plans in which you don’t have to order when the peak times hit.

4. Go For Pickup

If you want to save the delivery fee, then going for the Pickup is the only option. When you change the setting from delivery to Pickup, you go to that restaurant or shop yourself to get your food and groceries.

So, these are some of the effective ways which you can follow to save a fortune. If you think about it, choosing these things can save you a lot of money at the end of a year.

Final Words

Postmates is one of the most used delivery services in the USA, covering more than 189 cities. It is also considered to be one of the costliest services as well. Have you ever wondered why Postmates is so expensive?

The top five reasons are Postmates charges restaurants fees which they pay by increasing the food prices, Small cart fees, high delivery & service fee, the benefits the company has to provide for independent workers, and blitz pricing.

You can also save some money using Postmates by opting for a few options, like enrolling in an Unlimited membership program, using promo codes, and going for the Pickup option to save money on delivery.

No matter what you do, one thing is certain. Postmates is one of the most reliable delivery services for Americans, and it will continue to shine in the coming years as well.