Backlash to misleading delivery fees at Nando's

Several Nando’s customers have got in touch with us after ordering food that was advertised as having ‘free’ delivery, yet it cost more than if they had picked it up.

This follows our recent investigation into misleading delivery pricing. The practice, common in the delivered food sector, sees some businesses claim to have a set delivery fee or no delivery fee at all – yet they increase the price of every item in the cart when ordered for delivery.

A delivery fee by any other name

Food delivery customers are fed up with the lack of transparency and purposeful withholding of information around delivery pricing.

A Nando’s customer, Ben, got in touch with us after a disappointing experience claiming a ‘free’ delivery offer. In an email to Nando's, Ben questioned the company: “You claim to offer free delivery ... a double breast burger is $15.50 for pick-up, but changes to $17.50 as soon as we opt for delivery. Is this not a ‘delivery fee’? Did the burger cost you more to prepare it to be suitable for delivery?”

Nando’s responded: “As a premium service, ordering food via delivery does carry additional costs ... We don’t increase the price of menu items when we promote free delivery and there is no delivery fee associated with your order during these free delivery promotion periods.”

Ben said their response literally confirms the higher prices pay the fees and costs associated with delivery.

“That’s ‘delivery fee’ with extra words. It’s not ‘delivered for FREE!’ if it costs more than picking up.”

The terms and conditions on Nando’s website do not include any mention of the additional costs.

Take a look at the Facebook page for Nando’s NZ and you’ll see that every post advertising its so-called ‘free’ delivery deal is met with backlash from customers in the comments section.

The company’s reply to the comments is always the same. We approached Nando’s for a comment and received the same answer, virtually word for word.

The spokesperson said: “As a premium service, ordering food through both our Nando’s Delivery and third-party delivery partner platforms do carry additional costs for both the actual delivery as well as an increased price point for menu items ... the slightly higher food costs (compared to our dine-in and pick-up prices) helps cover the costs and fees associated with delivery ... We do not increase the food costs any further when we promote free delivery.”

They went on to explain that during their free delivery promotion, there is no delivery fee associated, other than the built-in price increase which goes towards the delivery cost.

No matter how you try to word it, it’s still an extra cost incurred for delivery. In our eyes, that makes up part of the overall cost for delivery.

Buried in the fine print

Since our initial investigation into hidden delivery fees, Restaurant Brands (which operates the New Zealand franchises for KFC, Pizza Hut, Carl’s Jr and Taco Bell) have still not replied to our initial attempts to get in contact.

All four franchises’ websites have, however, added ‘Menu Pricing’ to their terms and conditions: “Menu prices may differ between delivery and pick-up due to the different associated costs and the nature of those services. The cost of delivery is captured through both the menu price and the service fee.”

After we pointed out its misleading pricing in May, Domino’s announced a 6% service fee on deliveries, claiming: “We have held off introducing this for as long as we could even as it has become standard in our industry”. This is despite having been charging customers hidden fees all along.

Since our follow-up in July, Domino’s has added yet another update to its website’s terms and conditions, capping the delivery ‘service fee’ at $4.

Prior to this there was no cap on the service fee, meaning a larger order would be paying more for the price of each item, as well as the service fee and delivery fee on top.

We lodged an official complaint with the Commerce Commission in July, asking them to investigate.