Cost Breakdown for Food Delivery in Singapore

When ordering a meal through delivery apps in Singapore, the final price typically exceeds the menu price by 30% to 50% due to multiple layered fees. Understanding this breakdown is essential for both consumers and restaurant operators.

Customer-Facing Costs

For a typical meal order, you'll encounter:

• Delivery fees: S$2 to S$5, varying by distance and platform
• Service/platform fees: 10% to 15% of your total order
• Menu markups: Restaurants often charge 10% to 20% more for online orders compared to dine-in prices
• Optional tipping: S$2 to S$5 for delivery drivers

Example: A S$25 meal could cost S$37–S$40 after delivery fees (S$3), service charges (S$2.50–S$3.75), and menu markup (S$2.50–S$5).

Restaurant Commission Structure

Restaurants face significantly higher costs when using delivery platforms:

For a S$25 order with a 25% commission, restaurants lose S$6.25 immediately. Across hundreds or thousands of monthly orders, this becomes tens of thousands of dollars annually—effectively a recurring operational tax.

The Profit Margin Squeeze

The challenge is acute because food costs already consume 30% to 35% of revenue, while rent and labour account for approximately 75% of operating expenses. When platforms charge 25–30% commissions, net profit on delivery orders often disappears entirely.

Cost-Effective Alternatives for Restaurants

Rather than relying solely on commission-heavy marketplaces, restaurants can adopt flat-fee SaaS platforms (such as Eats365 or Shopify/WooCommerce), which offer predictable monthly subscriptions that become cheaper per order as volume increases. Additionally, the Productivity Solutions Grant (PSG) can subsidise up to 50% of qualifying software and hardware costs for eligible small and medium enterprises.