Posted February 07, 2018 12:07:11For most of the past decade, Panera has had a lucrative partnership with Uber to deliver food delivery, and now it has become a new business model for the chain.
Panera is currently testing a new $1-per-pound fee for drivers, and it will likely expand its partnership to include restaurants, retail and other businesses in the near future.
The company said Tuesday that the $1 fee will be rolled out to customers who use the app in the next six months.
Paneras new driver-payment system will use a credit card for all drivers’ payment, and the payment will be processed directly by the Panera account owner, according to the company.
Paners $1 driver-fee will be in place in the first quarter of 2019, according the company, and will apply to drivers who sign up within the first six months of the new system’s launch.
Panera, which owns Panera Bread and is a subsidiary of Papa John’s Corp., has a $3.4 billion annual revenue, and according to its most recent earnings report, earnings were up 30% year-over-year.
Paneras revenue grew 16% from the previous year to $1.1 billion, and gross margins were up nearly 40% to 28%, Panera said.
The Panera driver-pay system is expected to roll out to Panera restaurants, and other Panera franchisees later this year, according an executive with the company who spoke on condition of anonymity.
The $1 charge applies to all drivers in the U.S., regardless of their driver status, the executive said.
It’s not clear how many drivers will be eligible for the $25 fee, or whether the company plans to roll it out to all Panerases in the United States.
The Panera app already lets customers pay for deliveries by credit card, and some people have used that feature to pay for food delivery at Paneramas restaurants.
Uber’s driver-service program has been the subject of heated debate because the ride-sharing service has faced increasing scrutiny over the safety and well-being of its drivers, who are among the most vulnerable to the kind of driver-abuse allegations that have plagued the company’s operations.
In July, the Department of Labor ruled that Uber’s drivers should be paid the same minimum wage as their colleagues, but Uber has appealed the ruling.