Do we get paid more to deliver burritos to people than we do with rideshare? Christian Peru from the Rideshare Guy made a video about about the difference between rideshare and delivery, and he brings up some interesting points.
Check out the video, then read the video transcript to see all of the points he covers.
There are more delivery companies than rideshare companies
The biggest thing when we compare rideshare versus delivery, is just the sheer number of companies that you can drive for and deliver for compared to rideshare. For rideshare, we have Uber and we have Lyft. And those are like the biggest players in town and they certainly have the most business in passengers. The most popular for on-demand work. But you also have Via, Juno, Fasten and a couple smaller players. And they’re only in larger markets. They’re not that big yet. When you go to delivery though, you have Postmates, Caviar, Door Dash, Eat24, Amazon Flex, Favor, Uber Eats, and you know, the ones I’m not even thinking of right now.
Delivery companies pay drivers differently
From a driver’s perspective, there’s a lot more competition in the delivery game versus rideshare. Looking at how pay gets calculated, the big difference with delivery is that for the most part, delivery companies don’t pay on a time and distance rate card. Now, the big exception to that is Uber Eats, which does pay on the time and distance rate card. In fact, it pays more through UberEats time and distance than UberX in most cases. That’s kind of funny. Anyhow, the rest of the companies they pay with what’s called an “effort based” algorithm, which figures out the number of items and the difficulty and the estimated amount of time. They put that into an equation and they figure out how much they are going to offer to pay you per trip.
There’s a lot of fine tuning going on with these and not every one is created equally. In fact, some of these delivery pay algorithms are drastically better for drivers than others. And, you know, there’s just a lot that goes into that.
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Another exception on delivery is Amazon Flex. Amazon Flex gives you delivery blocks of hours. So, you might get four hours at $15.00 an hour each and then you earn 60 bucks. The cool thing with Flex is if you get that four hour block and you do all your deliveries in two hours, you still get to keep the 60 bucks. The bad thing is if you do it in five hours, then you only get paid 60 bucks.
Delivery drivers can earn more in tips than Uber/Lyft drivers
Another big thing with delivery is that delivery drivers earn a lot more in tips than rideshare drivers. Now looking at rideshare, we go back to that classic base plus time plus distance of each ride equation that’s been used in taxi cabs for who knows how long. If the base is $2 and the per mile rate is $1, the per minute’s $0.25, and you end up driving 3 miles in 10 minutes then that’s a $2 base plus 10 minutes at $0.25 per minute, plus 3 miles at $1 per mile and that comes out to a total of $7.50. Even though there’s a lot of controversy around up front pricing, we still have the rate card. We still mostly get paid on this equation.
Uber & Lyft have better incentives
The big thing with rideshare that’s bigger than delivery is that we have these incentives. We have things like Quest or Power Driver Bonus which pay out money base off of getting a certain number of rides in. Then we have Boost and Power Zones which is basically preplanned search. We get some tips every once in a while. Now on thing that’s big with rideshare though is that rideshare drivers are you’re gonna see a lot more surge and Prime Time on rideshare than you will with delivery companies version of that.
What’s the pay difference between rideshare and delivery?
Our top drivers on the blog here made $24.97 per hour as a rideshare driver in the bay area. And then $17.82 per hour as a delivery driver. One thing to keep in mind though, is that the rideshare driver has a much more expensive car and they do a lot more dead miles. Whereas if you’re doing delivery, you can do it on a bike, on foot, on a scooter, on a motorcycle. So, your cost can go down a lot more. You can even do it in a older car.
We just put out on this infographic with the differences in peak time. In the morning rideshare is busier, then some time around lunch people start to order food. You could work rideshare in the morning, then you can do food for lunch in the afternoon, and then in the evening you can pick whichever you want to do. Sometimes rideshare pays more, but maybe I don’t want to deal with passengers or maybe there’s a ton of drivers out on a Friday night and I’ll switch over to delivery instead.
Comparing and contrasting pain points. What’s worst about each job?
Looking at vehicle requirements now, rideshare drivers need a more decent car. 2002 or newer (in Los Angeles, newer in most cities), four doors, five seat belts. With delivery almost anything goes. You can get an older car, a two door car, a bike, motorcycle foot. And that makes it cheaper. It’s just easier to kinda deal with.
Looking at the pain points, the top three pain points for rideshare driving are having strangers in your car, extended periods of sitting, and then wear and tear on your vehicle. The top three pain points for delivery would be smell of food in the car, getting into buildings, and dealing with parking. Now, comparing that smell though, to some of my passengers, I don’t know, I’d take pizza over whatever that guy smelled like last week. Yeah. It wasn’t cologne I’ll give you that much!
Getting in the buildings as a delivery driver is kind of hard. You kind of basically have to learn how to break into places. You know, like these luxury condos because your customer is too lazy to come out and get his food. And then dealing with restaurants and parking you know, as a delivery driver the hard part really is leaving your car out there with your hazards on and running in there and hoping that they have your food ready. If not, then you just hope you don’t get a ticket. And the same thing goes when you’re trying to get into Larry’s luxury high rise condo apartment that looks like a box. That he pays $6,000 a month for.
How do you get a good rating with rideshare? Customer service, navigation, having a new car. People like new things. It’s not fair, it’s just reality. Having a clean car. That’s something you have more control over. For delivery, you need speed, accuracy, forks, making sure the food isn’t tossed and turned on the road.
Try delivery! You might earn more, you might like it more, and it’s the best backup
There’s a lot more competition among delivery companies. That means that you can probably find a company you like doing delivery for even if you haven’t tried it yet. On top of that, it’s always good to have both options available to you. Because, if Lyft goes down or if Uber deactivates you, then you can just switch over to delivery. And, you may even find that you make more money on delivery. Because in some cities the per mileage rate on Uber is $0.65 cents per mile, same thing with Lyft. That’s pretty close to what you get paid for delivery if not a little bit less. My big key take away is try delivery. Figure something out that you like. Keep your options open and that gives you power.
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