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“Restaurants in these smaller markets are genuinely excited that we’re coming,” said Lola Kassim, GM and director of Uber Eats Canada. “We’re able to provide new revenue streams to the local restaurants who decide they want to be on the platform.”

The towns which launched Wednesday are Woodstock, Chatham, Stratford, Grimsby, Fergus, Leamington, Tillsonburg, Strathroy, Fort Erie, Elora and Beamsville.

In most of the towns, Uber isn’t operating its rideshare service. So raising awareness — with restaurants, drivers and potential customers — will be one of the bigger challenges, Kassim said.

“We’ve got to get that marketplace moving, which means we need to create awareness,” said Kassim. “These are new markets entirely for the company, in most cases.”

‘Is it going to be profitable at all?’

Still, while the company says it provides new revenue streams for restaurants, the head of an industry association says the revenue can come at a high, often-unpredictable cost.

“It’s a question of ‘is it going to be profitable at all?’ and ‘are we going to just see sales transferred to off-premise or are we going to see a real increase?’,” said Kelly Higginson, CEO of Restaurants Canada. “We are in a cost-burden crisis right now.

Higginson said most restaurants which use Uber Eats end up paying 20-25 per cent of their revenue from delivery orders in fees to the company, though in some cases it’s even higher. At a time when 51 per cent of restaurants in Canada are either losing money or barely breaking even, that’s a hefty chunk of change, Higginson said. Before the global pandemic, said Higginson, just 12 per cent of restaurants were in similarly dire straits. Of the restaurants who are turning a profit, most have a profit margin in the single digits, she said.

“Most of our operators are in that 5 per cent range,” Higginson said.

While some provinces and cities have experimented with caps on the percentage charged by delivery services, Higginson said that can end up having unintended consequences.

“We’ve seen a cap go in B.C., but all that did was the delivery services just changed their service options for the operators. And then it became ‘you can add on to get more marketing’ or ‘you can add on to get a different level of service,’” said Higginson.

Delivery services boomed during the pandemic

Delivery services took off like a rocket during the early stages of the pandemic, especially when COVID restrictions meant restaurants and bars weren’t allowed to open for on-site dining. Now, says Higginson, Canadian diners have become accustomed to being able to order what they want, when they want.

“The change of culture, with people staying in with Uber Eats and Netflix as opposed to being more on-premise dining has been a huge increase, to 30 per cent of full-service restaurants’ revenue, from 10 per cent pre-pandemic,” said Higginson.

And Higginson said many restaurant owners aren’t easily able to gauge in advance how much those online orders are costing them.

“That’s one of the hard things about it — a lot of our operators don’t realize the amount they’re going to be paying until the end of the month,” said Higginson.

Still, argued Kassim, Uber Eats also gives restaurants exposure to a broader range of customers than they’d otherwise be getting.

“We’re providing marketing and discovery to help restaurants grow their business,” said Kassim, adding that 70 per cent of Uber Eats customers have ordered from restaurants they had never eaten at.

And, she added, the restaurants don’t have to sign up if they don’t want to.

“Restaurants and other merchants choose to be on Uber Eats,” said Kassim. “And they choose to be on Uber Eats because they value the services that we’re providing.”