How Much Money Can You Make Driving For Uber Eats

If you're thinking about giving Uber Eats a try, an important thing to know is how much you can make.

Maybe you're looking for a side gig to make some more money.

Or possibly you already deliver for someone else. Now that Postmates has been swallowed up by Uber Eats, is Uber Eats a good alternative? Maybe Doordash or Grubhub or other apps in the food delivery industry are a bit of a disappointment.

Unfortunately, there's no single answer to the question of how much you can make. As an independent contractor, there is no hourly rate, no salary or benefits. The federal minimum wage doesn't apply to you.

Does that make it too risky? Will you be left spinning your wheels? How do you know what you're getting into?

The good news is you have more control over what you can earn than you might realize. To help understand what you can make and how you can maximize it, we'll look at:

• What are some drivers earning with Uber Eats?
• The six factors that determine how much you can make on Uber Eats
• How you can use those factors to boost your profits.
• Is it worth it to deliver for Uber Eats?
• Is Uber Eats a good choice as your main hustle?

What are some drivers earning with Uber Eats?

It all depends on who you talk to.

I see some claiming that you're only getting $8 to $12 per hour. I can tell you from experience that they're wrong.

I've seen some sites show an average salary for Uber Eats couriers in the mid $40k range. Using the word salary in an estimate immediately destroys the credibility of that site. There is no salary, as Uber Eats drivers are not employees.

I can tell you that it's very possible to profit $40,000 annually with a very reasonable full-time (or even less than full-time) schedule.

Sam Lyon was a guy who made news when he went out and tried to see how much he could make working 12 hours a day for a month. That's a 72 hour work week, and he was on pace for more than $100,000 a year. That's some pretty good money, definitely the higher end of the pay scale.

But the thing is, the vast majority of people who deliver for Uber Eats do this part time. It's a side hustle to earn extra cash. Comparing it to a full-time job salary isn't helpful.

Uber Eats CEO Dara Khosrowshawhi recently tweeted about going out on food deliveries. Yahoo Finance spun it to say it proved drivers make less than minimum wage, even though nothing in the tweets did any such thing. To their credit they did correct the story, however was the original headline:

My point is, don't rely too much on what one person will tell you. Some will promise you big money, but it turns out they can get a referral fee if you sign up. Others are hell bent on proving that gig companies are ripping you off and they'll distort the numbers downwards.

The truth is, earnings vary a lot.

It's a little confusing when some are talking about annual earnings, especially if you're not thinking of this as a full time gig.

Some of the best information I've seen was a breakdown of a lot of data from with the Uber Eats earnings of a lot of people. Based on that information, the median hourly amount nationwide was $17.74.

Pay attention to that word: Median.

We mistake it for average. It's not average. It's middle. In other words, there are just as many people making more than $17.74 per hour than are making less than $17.74 per hour.

Those highs and lows can get really high and really low.

I'm hoping to get permission to share more details on that pay. If so, I'll update this page with a chart and link. It's good information.

Are drivers making less than minimum wage when they deliver? Some are. Can an Uber delivery driver make more than $30 per hour on deliveries? Some are.

You'll find both extremes working in the same market.

That tells us two things:

• There is no one answer to how much you can make on Uber Eats.
• You have more control over how much you can earn than you might realize.

Six factors that determine what you can make on Uber Eats

Here's the important thing to understand: Uber Eats does not pay a wage, salary or anything like that.

I think Kevin at FinancialPanther.com said it best. With any of these food delivery apps, you are not trading time for money, but you are trading tasks for money.

You complete a delivery (a task). You receive payment for that delivery. It's as simple as that.

When you understand how the payments work with Uber Eats, you get a better feel for what you can make. You also know the things that you can control to increase your earnings.

The Uber Eats pay model boils down to four things: Delivery fees, their Trip Supplement, Incentives, and Customer Tips. Two other factors make a difference in what you make: time and expenses. We'll look into all six of these factors.

1. Uber Eats base pay.

Uber Eats calculates a delivery fee based on how far you have to go and how much time it takes.

Unfortunately they don't tell you how they calculate the fee.

Once upon a time they used a very transparent formula.

• A pickup fee
• A drop off fee
• A per-mile fee (from the restaurant to the customer, actual miles)
• A per-minute fee (from arrival at the restaurant to the time you drop off).

Uber Eats still calculates the base fee on those factors. However, they no longer tell us what those numbers are.

What that means is that the longer you have to drive from the restaurant to the customer, the higher the base fee. The longer a delivery takes from the time you arrive, the higher the base fee.

In this way, I believe Uber Eats is better than the other major apps about adjusting their delivery fee in accordance with how far you have to go. The following screenshots of delivery pay summaries show you some differences.

The driver pay summary above shows a very short, very quick delivery. The customer was only a block from the restaurant and the delivery took less than 9 minutes. The base pay on this delivery was only $1.59.

By comparison, this screenshot was for a long trip, 8.4 miles and 21 minutes. The base pay was $4.69, nearly three times as much as the shorter faster delivery.

A weird anomaly revealed the current Uber Eats formula in my market.

When I was going through my summaries one time, I noticed one delivery in the middle of all the others that showed a different breakdown of fees. Evidently the computer had a glitch, because it showed all of the old elements.

Doing the math, it breaks down to:

• 35 cent dropoff fee
• 74 cent pick-up fee
• 30 cents per mile
• 5 cents per minute.

These numbers are fairly consistent with the base pay for most of my deliveries. If you do the math, the formula comes within a couple pennies on each of the deliveries above.

Under the old pay model, Uber Eats used a different formula for different markets. I don't know if they do that still today. Either way, this shows that Uber Eats is still using a version of their original pay formula to calculate the base pay. They're just no longer letting us know what it is.

2. Uber Eats Trip Supplement.

Uber Eats will sometimes add an element to the pay called a trip supplement.

While the base fee appears to be based on a formula, Trip Supplement is the piece to make the total delivery fees "whatever Uber Eats wants them to be."

If the base pay is less than whatever minimum Uber Eats feels like honoring, the Trip Supplement makes up for it. That first screenshot, for instance, had a 91 cent Trip Supplement to bring the total delivery fee up to $2.50.

When they added the Trip Supplement, they said it was there to "make earnings for each trip more reflective of that trip."

I think this is a lot like what Doordash includes in their base pay. Supposedly time and distance are a factor, but the big part of how the delivery fee for Doordash orders is "Desirability."

Basically, this is Uber's way of adding a wild card to the payment. If they don't think drivers will accept an offer, this is the easy way to increase pay. Bump up the supplement and now maybe someone will take it.

There's no discernable rhyme or reason as to how Uber determines the trip supplement. At the end of the day about all it does is give Uber Eats some additional pricing flexibility.

3. Uber Eats Incentives.

There's a third piece of the puzzle that also gets paid by Uber. They have a number of incentives that they offer to try to make sure that deliveries get taken.

On a delivery by delivery basis they could bump up the pay on a certain delivery with the trip supplement. However, to handle deliveries at a larger scale they'll use incentives to get more drivers to get out on the road.

Because those of us who deliver for Uber Eats are independent contractors, Uber cannot set schedules, nor can they require us to accept any particular delivery orders. Yet somehow they have to make sure that as many orders are actually delivered as possible.

The best way to do that is to offer extra money to encourage more people to deliver. There are three types of incentives that are the most common that I'll discuss.

They may have some others from time to time. For instance, at one time they offered a minimum hourly guarantee in my market if you met certain conditions. I've heard of consecutive delivery bonuses. But these are not nearly as common, so we'll stick to these three.

You could see one, two or all three of these at any given time. And then, when things are slow, you may not receive any. It all depends on what Uber thinks the supply and the demand for drivers will be.

Boosts

Uber Eats doesn't work with schedules in the same way that Grubhub and Doordash do. However, they will use boosts to encourage drivers to plan on delivering at certain times.

Uber will forecast what demand they think there will be within their market, and when they think they'll need drivers the most. Using that data, they'll post a schedule of when certain boosts will be live and in what part of the market.

The screenshot above is from the Promotions calendar in the Uber Driver app. You'll see that boosts are planned for Monday from 5 to 9 PM and Tuesday from 4 to 8.

The number in the boost tells you how much the base pay is going to be boosted. A 1.1 boost means that you multiply the base pay by 1.1. In the second pay screenshot listed above, there was a 1.1 boost in effect at the time. The base pay was $4.69 and the boost was another $0.47. That was 10% of the base pay.

There was no boost in the first example pay summary. If there were a 1.1 boost it would have added 16 cents to the pay. Don't spend it all in one place.

The boost is only multiplied against the base pay. Trip supplements and other incentives do not affect boost pay.

The map above is a screenshot from the Uber app that shows the boost zones available in the different parts of the city. You can identify from the map the parts of town where deliveries are paying more.

Surges

Uber Eats will also offer an extra amount per delivery called a surge. Surge prices for UberEats delivery drivers are similar to peak pay with the Doordash app. It's often one or two dollars extra per delivery (or higher in extremely busy times).

While boosts are usually scheduled and tied to certain times, surges often happen on the fly. In other words, Uber Eats can figure out that things are busier than they expected and they'll bump the pay per delivery accordingly.

The pay you get from a surge isn't based on a percentage of your base pay but instead is a fixed amount that is added to every delivery in the region at that time.

Quests

To encourage you to accept more deliveries, Uber Eats will offer a Quest. If you complete so many deliveries in a certain time frame, Uber Eats will pay you a bonus of so much money.

Like boosts, Quests are usually scheduled. They come in a number of shapes and sizes.

Uber Eats might offer a larger quest for completing a certain number of deliveries in a week's time. Or like the screenshot here, they'll offer a quest of $10 for every five deliveries completed. I've seen Uber pay a quest for just a single delivery. Other times I've seen them give you a choice of quests for the week, where for example you could choose between whether you want to shoot for five, ten, twenty or forty deliveries for the week.

You only get paid for a quest when you complete all deliveries. The deliveries must be completed and other conditions may apply.

4. Customer tips.

Tippig on Uber Eats has been by far the largest area of improvement over the past year or two.

Customers can tip one of three ways:

• Customers can add the tip when they place their food order
• They can choose to go into the app after the delivery is completed and add a tip. They can also adjust the tip amount if they felt service was fantastic or horrible.
• Customers can choose to give you a cash tip as you complete the delivery.

Uber actually discouraged tipping when they started as a company. They claimed that their rideshare drivers were paid well enough that tips weren't necessary.

That attitude moved over into delivery. Originally, customers could not tip through the app. When Uber finally introduced in-app tips, they didn't make it easy for the customer to find. Customers could only tip after the delivery was over, and Uber didn't make the option prominent.

Finally, starting around January 2019, Uber started letting customers add their tip when they placed their order. It took them time, but I think they finally realized that if customers tip well, Uber wouldn't have to pay as much out of their own pockets.

Once they figured that out, Uber Eats quickly became among the best at encouraging their customers to tip.

Related: While tipping has improved immensely for Uber Eats drivers, Uber Eats does still play games with the tips. Read more about how Uber Eats is hiding the tip and then lying about it.

5. Time

The first four factors are all tied to payments you get from Uber Eats (or from the customers). This isn't a pay factor but it may make the most difference of all of them in how much you can earn.

How quickly can you get the delivery completed?

Because here's the thing: You get paid what you get paid for any given delivery. However, if you can get more deliveries done in a given time, that's more money that you make.

Let's say the average pay on a delivery is $10. If you can complete two deliveries per hour, that's a $20 hourly rate. Three deliveries in an hour bumps you up to $30/hour and four hourly deliveries nets you $40.

Faster, shorter deliveries mean more deliveries per hour. If you can avoid wait times at restaurants, you can complete more deliveries.

Earlier in this article I mentioned how the Financial Panther site stated that this was about trading tasks for money. I agree with him, but let's be real here. Tasks take time. That means you're still trading time for money.

The thing is, the more tasks you complete in the same amount of time, the better your bottom line at the end of the day.

Choosing shorter deliveries and avoiding restaurants that typically have long waits can make a huge difference. Becoming more efficient at getting in and out of restaurants makes a difference. The faster you can deliver, the more you can earn.

6. Expenses.

An important thing to remember as an independent contractor is that you are doing this as a business. Your contract says that you are contracting with Uber Eats as a business, not as an employee. You pay taxes as a business. You're on your own for your costs of doing business.

Why's this important? When you're running a business, the money you get from Uber Eats, customer tips, from the Grubhub and Doordash apps and others is NOT what you are earning.

Your profit is what you earned. It's what's left over after your expenses that matters.

If you drive your car to deliver, you have an expense. Obviously there's the fuel costs, but vehicle expenses go a lot further than that. Every mile you drive brings you closer to replacing tires, timing belts, and all sorts of other vehicle maintenance. Each mile you drive means your car is worth a few cents less.

You will pay those costs eventually. If you deliver a lot, you'll wear your car out. You must take all of that into account when asking what you are earning.

Everything else in this list of factors is stuff that increases earnings. This is about not taking away from your pay.

It's important that you know how much it costs to use your car. It's rare to total out less than 30 cents per mile. Understand that for every mile you drive, you are reducing your earnings. Figure out how to drive less and you can increase your bottom line.

How much do Uber Eats drivers make? Measure it in Profit per Hour.

Here's where you add it all up.

It's adding up all of the base pay fees, trip supplements, incentives and tips. Figure in how many deliveries you're getting done per hour. Then subtract the cost of running your car.

Figure out your profit per hour. Add everything you earned, subtract your expenses, then divide by the number of hours you worked. That's the best way to measure how you're doing.

Once you understand your profit per hour, then you can compare it to traditional salaries. Your profit per hour gives you a good handle on whether you're making a decent amount, or if it's less than you might have thought.

How can you use these six factors to boost your profits?

The key here is to find the best combination of earnings, time, and minimum expenses. Knowing what those factors are helps you look at how you can weave them together for the best earnings for you.

The temptation is to maximize every factor. However, many of these work against one another. If you look closer at how each one works, you realize that sometimes it's better to focus on one over the other.

You could get longer deliveries and make more pay, right? You get paid more because of the time and distance. Unfortunately, more pay on a delivery is not always better. Think about how much Uber Eats is adding to my pay for every minute in the example above: 5¢

That's $3 per hour.

In other words, it's counter productive to go after deliveries that take more time simply because they pay more. Uber Eats is not paying enough more for that time to justify that additional time.

Incentives can be great. But sometimes everyone else is chasing incentives as well. You may make more per delivery but if the area is saturated, you might also be waiting longer between deliveries.

Do you focus on the fact that customers can change their tip? Could you make more by providing fantastic customer service? In looking at my last 200+ deliveries, I only saw 2 cases where the tip may have been changed. One was reduced. Customers don't change the tip very often.

The point here is not to zero in on any particular pay factor. Instead, the key is to work on the best combination of pay factors to help you out.

Ranking the pay factors by priority.

If I were to rank the factors in order of importance, this is where I would focus:

• Time
• Tips
• Expenses
• Promotions
• Trip Supplement
• Base pay.

One thing I give Uber Eats credit for is something no one else does: They display the estimated delivery time. They're usually pretty good with that estimate. If I didn't know anything else about a delivery, time is the one thing that would matter to me. Even more than the pay amount.

My lowest priority is base pay from Uber Eats (base pay plus supplement). It is the most misleading. The truth is that the more that amount is, the less valuable the delivery is.

That's not what you'd expect. More money can't be worse than less, can it? But like we talked about earlier, if you're only getting an additional $3 per hour for the extra time, you're losing ground.

It's all the other things in the pay that make up for that difference. The tip, promotions, and trip supplemented get added on to a delivery.

And this is why time is the most important factor. The more deliveries you can complete, the more times you get paid all these other things. More tips, trip supplements and surges are far better than getting paid 5 cents per minute for additional time.

Is it worth it to deliver Uber Eats?

It may be. It might not be.

The answer depends on a lot of things. I've had long periods of time where Uber Eats was my go-to delivery option. Other times I barely touched them.

It really depends on how frequently delivery requests come in and the quality of those offers.

One of the reasons it goes back and forth for me is that sometimes, there are way too many other drivers logged in for the number of orders that are out there. Other times, Uber Eats is begging for couriers to meet the demand.

If you're in a market where things are really slow, without a lot of busy periods, it may not make sense. Or if you're not able to go at the time of day that has the best potential, or all those things that make a difference, it may not work as well.

The beauty of it is you get to be your own boss. You can set your own schedule and make your own decisions. The trade-off is, there are no guarantees. In the long run only you can decide which answer is best for you.

Does Uber Eats pay enough to be your main hustle?

Is there enough profit potential out there to work exclusively on Uber Eats deliveries?

I can't answer that. Every person is different, every situation and every market is different. They can be great in one city and terrible in another.

Personally, I'm not a fan of delivering exclusively for one platform. I look at Uber Eats, Grubhub and Doordash as my customers. No business should rely only on one customer. That's just me.

However, if you used to deliver for Postmates as your main line of work or are thinking of switching from another app, it's a fair question as to if they're a good replacement.

In order to know if they pay enough, you'll need to weigh the factors above. And then ask some other questions. Continue reading here about if Uber Eats pays well enough to be your main earnings.

How Much Money Can You Make Driving For Uber Eats

Source: https://entrecourier.com/delivery/gig-delivery-platforms/uber-eats/uber-eats-commentary/how-much-does-uber-eats-pay/

Posted by: dobbinsladmoultan.blogspot.com

Share this post