Delivery commission maths: are those orders actually profitable?

Delivery feels like free revenue: the order arrives, the kitchen makes it, someone else drives. Then the monthly statement lands and the margin is not where you expected.

Here is the full calculation.

The naive version

A SAR 60 order. Food cost 30% = SAR 18. Commission 25% = SAR 15. Left: SAR 27, or 45%.

That is not the number.

The real version

Same SAR 60 order:

And contribution is not profit. Rent, wages, utilities and everything else still come out of it. A dine-in order at the same price with no commission and no packaging contributes SAR 42 — more than double.

The four lines people forget

Packaging. Real money, and it scales exactly with delivery volume. A restaurant doing 80 delivery orders a night at SAR 3.50 of packaging is spending SAR 8,400 a month on containers.

Funded promotions. "50% off, up to SAR 30" campaigns are often co-funded. Read which share is yours. This is the line that most often surprises people at the end of the month.

Refunds and remakes. Delivery has a higher rate than dine-in, because the customer cannot see the food before it leaves and cannot flag a problem while it is fixable.

Preparation load at peak. Delivery orders arrive in the same hours as your busiest dine-in service. If they slow table service, the cost appears in a different column — smaller tips, slower turns, worse reviews.

What to do about it

1. Price delivery items deliberately

Many Saudi restaurants set delivery menu prices above dine-in prices to absorb commission. This is legitimate and common, and it must be deliberate: decided, documented, and consistent across platforms.

The arithmetic: to preserve a SAR 42 contribution on a 25% commission with SAR 3.50 packaging, the delivery price needs to be roughly SAR 88 rather than SAR 60. Whether your market bears that is a separate question — but now you know the number rather than guessing.

2. Know your contribution by dish, not by average

Some dishes survive delivery commission comfortably; others lose money on every order. Typically:

• High food cost, low price — loses money on delivery
• Low food cost, high price — fine
• Anything that travels badly — loses money twice, through refunds and reviews

Build your delivery menu from the dishes that work, and leave the others for dine-in.

3. Measure contribution per channel, every month

Your POS should tell you revenue, food cost and contribution by channel: dine-in, takeaway, and each delivery platform separately. If it cannot, that is a gap worth closing — you cannot manage what you cannot separate.

4. Reconcile every statement

Check order counts, gross values, commission rates and promotional splits against your own records. See theaggregator guide for what to look for.

When delivery is worth it anyway

Even at a lower contribution, delivery can be the right decision when:

• It uses kitchen capacity you are already paying for in quiet hours
• It is customer acquisition you convert to dine-in later
• Your fixed costs are already covered by dine-in and delivery is incremental

What is not defensible is running delivery without knowing the number. Work it out once, per dish, and then decide.

Wameed separates channels in reporting and integrates with ten platforms; see theintegrations page and thereports feature.