Supermarkets undercut indies on Uber Eats orders

Our research found Asda's pricing on the third party platform was on average 16% above its standard prices.

Independent stores using Uber Eats have claimed preferential terms offered supermarkets are damaging their online sales.

Asda confirmed last December that 100 stores were using the delivery platform, following a trial in Leeds and Birmingham earlier in the year.

Customers using the service have access to more than 300 own-brand products and branded everyday items, including ready meals, fresh fruit and vegetables, beer, wine, and spirits.

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Typically, independents who sign up to the service pay an initial £750 signup cost, with Uber Eats charging a standard 30% commission per order.

However, Jay Sandhu, owner of Supermags in Birmingham claimed preferential rates being used by Asda were giving the supermarket an unfair price advantage.

“I used to get at least 30 orders day, but ever since a nearby store started using the service, I hardly get any,” he said.

“They are selling products at shop price. Because I can’t match that, I’m losing customers.”

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Better Retailing compared Asda’s website and Uber Eats pricing on 75 common convenience lines. Its pricing per line on the third party platform was an average of 16% above its standard prices, far below the 30% commission charged to independents.

Asda’s Uber Eats mark-up differed greatly by category. Confectionery offered the smallest price difference at 8%, with personal care offering the largest at 20%.

Other categories included ambient grocery (5%), chilled (16%), snacks (16%), pet food (17%), household (17%), frozen (13%), dairy (16%), tobacco (17%), and alcohol (17%).

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Sandhu added independent shops in the surrounding area felt let down by the delivery platform. “A lot of us continued operating Uber Eats during the pandemic to help our customers, and we don’t feel supported being treated this way,” he said.

Another retailer said the price disparity between multiples and independents on the platform would increasingly attract the ire of store owners as more multiple stores were added to the service.

Previously, symbol groups have managed to strike temporary deals with Uber Eats to secure preferential rates for their retailers. In 2019, Premier store owners were offered 15% commission for the first month after they signed up.

Similarly, Nisa told retailers it had worked to agree preferential terms to help the rollout of home delivery through its partners, with rates as low as 23%.

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An Uber Eats spokeswoman said: “At Uber Eats, our top priority is to support retail stores, restaurants and the thousands of people who rely on them for work and as an essential service during this difficult time.

“Throughout this crisis we have invested millions in driving demand for our partners to support them, and we are proud that we have been able to help them boost their sales and reach new customers.”

An Asda spokesperson said: “Each week we offer thousands of rollbacks in our stores and online to provide even better value across our customers’ favourite lines. We set our own prices on the Uber Eats platform and many of the products featured in this survey were offered at a promotional price in stores and on Asda.com.”

Find out more on our coronavirus information hub for retailers


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