Home Tech Meituan rake changes: do merchants and riders make money?

Meituan rake changes: do merchants and riders make money?


Author|Zhang ChaoEditor|Luo Lijuan

Takeaway rider, a profession that has been repeatedly discussed in the past two years. They go in the wind and rain, picking up “steel G children” in the local living market, but it seems that their personal safety and welfare protection cannot be effectively guaranteed. In September last year, a report on “Takeaway Riders Stuck in the System” sparked discussions across the Internet. The article describes that the takeaway riders are exhausted under the drive of the system algorithm. In order to avoid being fined for delayed delivery, the takeaway riders often violate traffic regulations and face the risk of traffic accidents. At that time, Meituan responded that it would better optimize the system, better protect the safety of riders, care for riders and their families, and improve the rider reward model. A revolution is going on around the way the merchants distribute the rake. Recently, Meituan has been exposed to adjust the merchant-side delivery billing method, from the original “one size fits all” commission, refined into a comprehensive commission based on delivery distance, order price, and delivery time. Although there is no official announcement for this adjustment, All Weather Technology has learned from some merchants that the first- and second-tier cities covered by Meituan Food Delivery have been gradually adjusted, and some merchants in third- and fourth-tier cities are also aware of the changes and will be adjusted soon. As for the reason and basis of the specific adjustment, the official has not yet provided an explanation, but from the notice issued by Meituan to the merchants, the adjustment is mainly “in response to the general merchants’ belief that the platform commission is too high, the billing is unreasonable, and the client delivery fee is high. “. Regarding Meituan’s new regulations, Runmi Consulting founder Liu Run believes that the new rules separate commissions and distribution fees, which can support small and medium businesses and help riders get more work. Meituan said to All Weather Technology that the reform of rate transparency has no impact on users. In the industry, not only Meituan, but also Ele.me has been exposed to carry out commission reforms, which are divided into fixed and floating parts. Similar to Meituan, the floating part will be charged in steps such as delivery distance and order price. What does this adjustment mean for all participants in the industry-riders, merchants, platforms, consumers, etc.? Merchants rush to welcome new regulations Chen Jie is the owner of an offline coffee shop in Guangzhou. Although his business is not as good as that of large chain brands, he is still a small success in the local area. The outbreak of the new crown epidemic in early 2020 brought Chen Jie’s coffee shop to a standstill, forcing him to find a new way out-moving his business online and connecting to a food delivery platform. Soon, he signed an exclusive cooperation agreement with the Meituan food delivery platform, and the order commission ratio was set at 16%. This means that Chen Jie can only open stores on one platform of Meituan Waimai, and cannot open stores on other platforms such as Ele.me. According to Chen Jie, this rake ratio has already been discounted. “If it is not an exclusive (agreement), the rake ratio will reach 21 points.” Fortunately, Meituan’s local market share still has a relatively obvious advantage, which has benefited Chen Jie a lot. “If you sell 300 cups of coffee every day, about 150-200 cups of coffee will be sent from the Meituan takeaway platform.” Chen Jie is paying more and more attention to online platform sales. But in the last half month, Chen Jie suddenly received a call from the business manager of Meituan’s food delivery platform, and was told that the distribution commission would be adjusted “from the original 16% to 6%”. It sounds like the platform makes a big profit, “but it’s actually not the case. It charges fees in other ways.” Chen Jie said. According to a “refined billing model plan” after the adjustment of Meituan Takeaway provided by him, this adjustment is mainly to split the previous “package fee policy” into two “technical service fees” and “performance service fees”. Each part, especially the “performance service fee” is divided in detail according to the delivery distance, order price, and delivery time. Meituan Food Delivery Refined Billing Model Solution You should know that the Meituan takeaway platform used to have a single and fixed commission method. The commission calculation formula is: (commodity price + packaging fee-activity intensity) * percentage of sampling point = commission. If the actual cost does not reach the guarantee fee, the platform will charge the guarantee fee. According to public information, the previous service fee guarantee for Meituan’s food delivery platform ranges from 3.5 yuan to 5.5 yuan. not difficult to see, The new regulations have implemented a lower commission rate for technical service fees. Once merchants adopt self-distribution methods, they only need to pay technical service fees to the platform. The minimum guarantee fee is more than 1 yuan, which is significantly lower than before; but for merchants who choose platform delivery, they need to pay the technical service fee to the platform. On the basis of the technical service fee, the performance service fee rules are followed. The latter will charge more for special orders such as 3 kilometers away and late at night. All-weather Technology also found that the adjusted Meituan takeaway business technical service fee ratio, the starting price of kilometers, and the charges per kilometer for more than 3 kilometers, there are certain differences in different regions. Comparison of refined billing schemes in different regions of Meituan Takeaway Soon after receiving the call from the business manager, Chen Jie had signed a new cooperation agreement with the platform and accepted the rule adjustment of Meituan Takeaway. But recalling the whole process, he was actually a little confused, and he didn’t even understand the specific calculation rules carefully. “He (the business manager) called me to sign in the past. He only mentioned that the deduction point would be a little lower than before, but didn’t elaborate. Many merchants signed the contract directly when they were busy.” Chen Jie said that he was in business. If the manager is required to sign after the notification, the Meituan takeaway has a high market share in the region and the merchants are also relatively dependent on the platform, so they will basically cooperate with the contract. After the new regulations came out, Chen Jie felt that although the store business has not been greatly affected, the order volume is basically stable whether it is within three kilometers or three kilometers away, but the actual receipt of orders beyond three kilometers has probably been reduced by a few cents. To a dollar, and the fees that need to be paid to the platform as a percentage of turnover are also increasing. From March 22 to April 20, 2021, the turnover of Chen Jie’s store was nearly 40,000 yuan, and the expenditure was about 10,000 yuan; and within 30 days as of May 20, 2021, the turnover of its store was close to 70,000 yuan , The expenditure exceeds 20,000 yuan. He mentioned that the monthly turnover increased, and the actual store order volume dropped by 2 orders from the previous month. What puzzled him was that the original “lower deduction” did not happen. According to calculations based on the specific data provided by Chen Jie, the proportion of fees he needs to pay to the platform in the turnover has increased from 26.12% in the previous stage to 30.08%. Some analysts believe that this rate change will benefit small and medium businesses, and most of the short-distance order rates will drop. In the case provided by Meituan to All-weather Technology: Take the Zhengzhou local brand “Prince in Love with Shrimp” as an example. Previously, a merchant with a unit price of 99 yuan for a “Heartbeat Meal for Two” had to pay a commission of 17.29 yuan. After the rate adjustment, under the same order, if the merchant chooses to deliver it by itself , Only need to pay 6.84 yuan technical service fee (commission), the commission rate is only 6.9%. If the merchant chooses Meituan delivery, if it is within the standard delivery range, the technical service fee (commission) and the performance service fee add up to approximately 14.24 yuan, which is a savings of 18% compared to before the adjustment. More businesses seem to be staying on the “wait and see” status of this adjustment. No one can say that the new regulations may have a long-term impact on them, and some even show a negative attitude. Li Wen runs a coffee shop in Foshan City, Guangdong Province that also serves Western food. Unlike Chen Jie who mainly develops online business, he only uses online as a channel for exposure and customer acquisition. Even after signing an exclusive cooperation agreement with Meituan, Li Wen revealed that the revenue from the Meituan takeaway platform accounts for less than 1/10 of the total store revenue. “I heard that the platform has adjusted distribution, but I didn’t pay much attention to it.” In Li Wen’s view, the platform adjustment must have been raised. In the end, it must be the merchants who pay for the payment, not the consumers. In fact, All Weather Technology learned from the consumer side that the meal delivery fee on the Meituan takeaway platform is suspected to have also been adjusted. Comparison of orders at 9 a.m. on February 23 vs. 9 a.m. on May 24 An order provided by a Meituan Waimai Shanghai user showed that in a rice noodle shop within 3 kilometers of him, multiple orders were placed in the morning, midday and evening in January and February this year, and the delivery fee was all 3 yuan. The subsidy activities were directly reduced and exempted; and when the order was placed again in May, the distribution fee rose to 4.5 yuan, and the subsidy activities still had to be paid 1.5 yuan. Is this a platform action or a business behavior? Meituan made it clear that the platform’s rate transparency reform has no impact on users. Millions of riders benefit? In the food delivery industry chain, the main players can be roughly divided into merchants, consumers, platforms, and riders. Regarding the commission adjustment, many riders told All Weather Technology that they did not feel the “benefits”, but actually felt that their income had declined since last month. The Meituan financial report shows that in 2020, a total of 48.7 billion yuan will be spent on riders, and more than 4.7 million riders will earn revenue on the Meituan platform. According to the categories, Meituan riders can be classified into three categories: special delivery, crowdsourcing, and running. According to the introduction of many platform takeaway riders, the delivery riders are regular employees and have labor relations with third-party platforms. The salary is settled according to the method of “basic salary + single-quantity pricing + rewards and punishments”. They are the guarantee of platform delivery efficiency and service quality. Crowdsourcing riders can be understood as part-time employees, mainly composed of social idle capacity, and only relying on order volume to get paid. According to Meituan’s official disclosure of “Lepao Network Appointment Distributor Activity Rules,” Lepao riders use a natural week as a single activity cycle, and the contract can be automatically renewed after the expiration meets the requirements of the distributor. Salary is calculated based on activity requirements such as order volume, online duration, peak online duration, punctuality rate, and order completion rate. A rider told All-weather Technology that Lepao delivery personnel are actually between dedicated riders and crowdsourced riders. There is a certain degree of freedom, no basic salary, and no grading rewards for ordinary online delivery personnel. From the perspective of the scope of distribution, the special delivery scope is small, and the crowdsourcing delivery scope is large; from the perspective of stability, the special delivery is the most stable rider, and special circumstances and extreme weather need to obey the platform dispatch arrangement. Even a special delivery rider with a basic salary does not dare to relax, and must complete the time and ensure the order quantity. In mid-May, Shanghai has begun to welcome the rainy season. The continuous rainy weather and rising orders have increased Guo Dong’s work intensity, but he can’t stop. “We (special riders) can’t stop taking orders, we can only transfer orders. .” According to regulations, Meituan special riders can have three big turns and two small turns every day. The so-called “big transfer” refers to transferring the order to the Meituan takeaway rider platform to wait for others to take the order; “small transfer” refers to the direct transfer of the order by entering the mobile phone number between the familiar riders. Guo Dong will only transfer orders when he encounters special circumstances or is too tired. This year is Guo Dong’s third year in Shanghai. He is already familiar with the area he is responsible for. He can complete more than 50 orders per day on average, and he will not be fined for personal reasons. As long as the goals and tasks are completed, Guo Dong’s monthly income is not a problem. But in Guo Dong’s view, the takeaway rider is a job that does not make money. “The money is made by dozens of people in the top rankings.” He reluctantly stated that if there are 100 people on a site, only 30 people at most can make money, “the remaining fine will be punished to death.” At the same time, Guo Dong also deeply felt that the mobility of riders is very high, and most riders will leave in the first half of the year. “The site where I work is 365 days a year and I can see new recruits every day.” Shen Jun and Guo Dong are colleagues at the same site. Although they have only been here for more than a month, they are “elders” in the industry. On a rainy day two years ago, Shen Jun encountered a car accident on the way to deliver food. His calf was severely injured and the treatment cost was about seven or eight thousand yuan. “The company doesn’t care about it and shirks its responsibilities. I pay for the medical expenses.” Shen Jun complained that the company’s insurance didn’t work at all, because this incident was very disappointing to the company. In fact, the special rider pays accident insurance money every month. Guo Dong revealed that the insurance premium for Meituan’s special riders is 6 yuan/day, and the insurance premium for crowdsourcing riders is about 3 yuan/day. But he also said that even if everyone has paid the insurance, they still face the difficulty of indemnity. The safety and welfare of takeaway riders have also attracted attention from all walks of life. Especially last year, after a round of media reports and public opinion condemnation, relevant local life service platforms have stated that they will make changes. On the eve of May Day, Meituan’s “One Boat Plan” for riders has made new progress. Meituan stated that in order to broaden the career development space for riders, the platform has improved the rider promotion and transfer mechanism, and further opened up distribution station masters, partner management posts, customer service, trainers and other positions; in order to enhance the experience of children with severely ill riders, in the original On the basis of some public welfare assistance funds, two new assistance policies have been added: “Green Channel for Appeal and Review” and “Baby Companion Day”. According to All Weather Technology learned from a site in Shanghai, starting from April 1 this year, the Meituan Special Rider Salary Program has also ushered in a round of adjustments. But on the whole, the target for rider responsibility orders has increased, supper subsidies have fallen, and the threshold for large and weight subsidies has increased. The rider said that the average salary per order is actually declining. If you want to maintain the previous salary level, all you can do is complete more orders. Compared with the delivery fee of less than RMB 10 per order, the penalty faced by the rider is not low. According to the latest penalty rules obtained by All Weather Technology, the platform will assess the riders from five aspects: bad reviews, overtime, order cancellation, early delivery, and other punishments. The penalty is as high as 500 yuan/ single. Penalty Rules for Riders of Meituan Takeaways at a Shanghai Site In addition, the above-mentioned sites have also issued administrative rules. If riders are late for the morning meeting, absent from work, smile action (spot checks and tests on riders by the platform, and require wearing work clothes, wearing badges and helmets to take photos), they will be caught. Punishment. Administrative Punishment Rules of Meituan Takeaway Special Riders at a Shanghai Site In the past April, Shen Jun worked for 30 days and the average daily order volume exceeded 40 orders. Due to serious overtime and other problems, he also received a fine that was several tens of times the fee for a single order. In the end, the average was only about 8.15 yuan per order, and the actual salary was less than 9,500 yuan. Former Meituan takeaway rider Tian Xia also told All Weather Technology that when he was a rider (in the summer of 2020), because he was not familiar with the road and the platform was far away, he not only ran through many red lights, but also because He was fined by the platform for overtime; as the business became familiar, he was able to receive multiple orders at the same time, did not run the red light or speed, and the punctuality rate remained 100%. But he believes that it is still “difficult and difficult” to earn more than 10,000 yuan. Or will the platform be under more pressure? As of about 8 pm on May 23, Shen Jun had already ran 61 orders that day, but he still couldn’t stop, and the station was still sending him tasks. But as a special rider, he couldn’t refuse to take orders. “There is no way if the site is not forced, because everyone can’t stand it (don’t want to take orders). Just like rainy days without subsidies, it’s easy to run hard,” Shen Jun said. Under the dual effects of algorithm-driven and spontaneous ordering, takeaway riders have become one of contemporary high-risk occupations – In September 2018, the Guangzhou Traffic Police investigated and punished nearly 2,000 traffic violations of takeaway riders; Tian Xia learned by querying the insurance section of the Meituan crowdsourcing app that as of August 2020, 157,483 people had passed the insurance products on the Meituan Takeaway Riders App. The claims were settled, and the total compensation was 1.13 billion yuan. Thousands of courier brothers are pursuing delivery timeliness and delivery orders at the cost of safety. Many people are sweating for them. The call for platforms to buy insurance for riders is also getting louder. In fact, in recent years, the cost Meituan spends on food delivery riders has increased year by year. According to financial reports, Meituan’s catering takeaway business revenue in 2020 will reach 66.265 billion yuan, accounting for 57.72% of the platform’s total revenue. The cost of Meituan’s food delivery riders has increased from 280 million yuan in 2015 to 48.692 billion yuan in 2020, an increase of more than 170 times; by the end of 2020, the cumulative number of riders who have achieved increased employment and income in Meituan has exceeded 9.5 million. . 2020 Meituan expenditure breakdown (by nature) In recent discussions on Meituan, there is a voice: Meituan cannot afford insurance to riders. Is this really true? To solve this question, a key question must be answered, that is, “what standard should Meituan pay for the rider’s insurance”. If you pay the three insurances (pension, medical and unemployment) of the “five social insurances and one housing fund”, based on the unit payment ratios of 21%, 9%, and 2%, the platform needs to pay about 32% of the salary. Dolphin Investment Research pointed out that the human outsourcing fee for Meituan Catering + Non-Meal Delivery in 2020 is approximately 54.3 billion yuan, which is equivalent to the total income of various riders. Roughly assuming that Meituan’s special riders contributed about 60% of the orders, Dolphin Investment Research calculated that about 32.5 billion yuan has social security payment obligations, and Meituan needs to take back 543*32%*60%=10,425.6 billion yuan. The reference basis for the other algorithm is the “Guiding Opinions on Regulating the Labor Employment of Catering Online Delivery Workers under New Employment Forms (Trial)” promulgated by the Nanjing Municipal Human Resources and Social Security Bureau. It is believed that “platform enterprises” should mainly be “specialized” “Send riders” to pay work-related injury insurance. In accordance with the state’s regulations on the payment rate of different industries, the insurance premium rate of the takeaway distributors is attributed to 1.1% of the “transportation industry” payable. Moreover, this algorithm also encloses the scope of insurance payment in the group of “specialized riders”. According to data from China Securities, Meituan currently has more than 1 million active daily riders, of which about 40% are dedicated riders. Rough calculations, the cost that Meituan needs to pay is only 486.92*40%*1.1%≈214 million yuan, which is far from the calculation result of Dolphin Investment Research. However, whether the documents on which the second algorithm is based can be adapted to major cities across the country is not yet known; in addition, whether crowdsourced riders and running riders should pay insurance has also aroused widespread discussion in the society. From this point of view, the outside world still needs more responses from the platform side for issues related to takeaway riders. It is reported that since the Spring Festival in 2021, Meituan Waimai has held 22 rider talks, during which more than 50 rider feedback suggestions have been collected, 19 of which have been improved or entered the improvement process. The riders look forward to more improvements on the platform that they are really concerned about. After the heavy rain, the sky has cleared up, but Shen Jun’s heart is still low. Just yesterday (May 23), a colleague of his was injured again while delivering the meal. He paid for the medical expenses in advance. How to pay it is not yet known. (Chen Jie, Li Wen, Guo Dong, Shen Jun, Tian Xia in the text are all pseudonyms)