Grubhub serves up new controversy in Iowa City market

Grubhub was effectively chased from the Iowa City-area market more than two years ago when local restaurateurs banded together to launch their own homegrown delivery service, CHOMP , in protest of the company doubling service fees.
Now the Chicago-based delivery behemoth is back in town, and it’s not winning many friends this time, either.
According to CHOMP co-founder Adam Weeks, Grubhub recently added about 90 area restaurants to its delivery roster without permission, leaving owners bewildered and angry.
“Their goal is to pay full price for the orders while simultaneously hounding the restaurants for a contract,” Mr. Weeks said in an e-mail, adding Grubhub was also publishing out-of-date menus and causing general confusion among staff and customers. “I’ve spoken to several restaurant owners who are very upset about this extremely predatory business practice.”
Seth Dudley, general manager of Iowa City’s Hamburg Inn, said he was surprised this past Saturday when a Grubhub driver arrived at the restaurant to pick up an order. After checking the Grubhub website and seeing that the Hamburg Inn had been listed without permission as a participating restaurant, he attempted to contact customer service to have the restaurant removed. A second Grubhub driver showed up on Sunday and another on Monday.
Though the Hamburg Inn filled the orders, reasoning it was not the fault of the customer or driver that Grubhub had added them to their site, Mr. Dudley called the business practice “unethical, bordering on illegal.”
“I was so appalled by how they handled the whole thing with OrderUp, so off-put by their business practices that we started CHOMP,” he said, referring to the Grubhub’s move to immediately double delivery fees from 15 to 30 percent when it purchased all 27 markets served by the former Groupon subsidiary in August 2017. “They’ve reached out to us several times asking us to join and I specifically told them, ‘No, I don’t want anything to do with you.’”
In an emailed statement, Grubhub said it began the practice of adding restaurants to its marketplace using available online information in late 2019.
“Historically, we’d only chosen to list partnered restaurants, and we still firmly believe this is the right way to build the marketplace and the only way to drive long term value for diners, restaurants and drivers,” a spokesperson wrote. “As other food delivery companies have chosen to list non-partnered restaurants on their marketplaces for years to widen their supply of restaurants, we’re now trying this strategy in select markets as a way to close the restaurant supply gap and drive more delivery orders to local restaurants.”
The company added that it hoped to convert non-partnered restaurants into partnered restaurants.
Mr. Dudley said he would not be signing up. After repeated attempts, he believes the Hamburg Inn has been removed from Grubhub’s site, though that is not the case for other restaurants, many of which he knows for certain do not wish to be included.