New York City Council Committee on Consumer and Worker Protection Meeting March 29, 2022
Establishing Exemptions for Third-Party Food Delivery Services from the Limits on Fees Charged by Such Services on Food Service Establishments.
Opposition for Int 0813-2022
FROM: Andreas Koutsoudakis, Founder/Owner, Marathi Greek Bistro; Co-Founder/Co-Owner, KI Legal
DATE: March 29th, 2023
Dear Chairwoman Velázquez,
I want to express my strong opposition to the Bigger Fees for Big Delivery Bill, as well as the ongoing efforts of these big third-party food delivery companies who want to gut the fee cap and revert to their preferred days of expensive, exploitative, and shady “marketing fees.”
I believe that every business owner wants to move past the pandemic. Every business owner wants their operation to be able to thrive after such dark times. And while most emergency orders came to an end as they should, some created such pivotal turning points in the development of industries in the city that they must not simply be abandoned.
With the fee cap, this was not pandemic driven – in fact, just weeks before the pandemic, I along with dozens of others stood on the steps of City Hall on 2/27/2020 and announced proposed legislation to cap the fees. Of course, there was nothing but extreme resistance by these 3rd party-delivery companies in response – “A VERY SMALL FEW DISGRUNTLED RESTAURANTS” they said. Well, then the pandemic happened, and instead of 10% fee cap that we originally asked for, the city passed legislation capping it at 5%. The writing was on the wall WELL BEFORE THE PANDEMIC, and the emergency was merely a catalyst for accelerating the fee cap legislation, not creating it.
Even so, there are nevertheless certain pieces of emergency legislation that were put in place that were so beneficial to our economy and communities that even if they were created out of necessity, we cannot just terminate them and revert to whatever existed before. We must learn from them, repurpose them, and implement them for the continued success of the economy and our communities – and without question that includes our small business community.
As a restaurant owner and a lawyer for hundreds of restaurants throughout the 5 boroughs, I truly know firsthand the devastating impact that these companies have on local businesses.
They claim they provide a valuable service for all parties involved – but the reality we are all too familiar with is that they are taking advantage of us by charging high and hidden fees.
They claim they support small businesses and the hospitality industry – but they actively harm us by taking massive percentages from our profits and leaving us with no bargaining power.
They claim that maintaining the fee cap will harm the very small businesses you, the Council, set out to help in the first place – but we all know that the only entities actively harming us are these multi-billion-dollar marketing machines with limitless resources and no concept of what it actually takes to keep a hospitality business afloat.
If your local restaurant closes, you will remember you server, the owners, your host. You will miss them. Your community will miss them.
Is the same true for Grubhub, Uber Eats, DoorDash and the like? Absolutely not. They don’t know anything about our communities – yet here we are pleading for you to protect your constituents and communities. Take a step back. Keep it simple. Do what’s right and necessary. Protect your constituents. Protect your communities.
The bottom line is that the cap saved many businesses during Covid. It allowed restaurants to keep more of their hard-earned revenue (nowhere even close to “profits”) and reinvest that money into the very people that help run their operations and serve their customers/guests. Should the exorbitant fees return, restaurants already struggling will severely jeopardize the health of their business. The line between working for yourself and working for others will be extremely blurry – yet again.
It will also affect the relationships I have worked so hard to forge with my customers since I, like many others, will have no choice but to pass on some, if not all, extra costs on to them.
I hope to ultimately partner with the Council, and these companies, so that fairer fee structures and accompanying strategies can be proposed. But, in the meantime, I truly urge the Council to reject the Bigger Fees for Big Delivery bill. I urge you to please help protect us local businesses and level the playing field. It is not an understatement when we say that we need your help to not only thrive, but merely survive, especially in the current economic climate.
KI Legal focuses on guiding companies and businesses throughout the entire legal spectrum. KI Legal’s services generally fall under three broad-based practice group areas: Transactions, Litigation and General Counsel. Its extensive client base is primarily made up of real estate developers, managers, owners and operators, lending institutions, restaurant and hospitality groups, construction companies, investment funds, and asset management firms. KI Legal’s unwavering reputation for diligent and thoughtful representation has been established and sustained by its strong team of reputable attorneys and staff. For the latest updates, follow KI Legal on LinkedIn, Facebook, and Instagram. For more information, visit kilegal.com.