One thing everyone wants to know: How much do DoorDash drivers make? Well we’re going to use data from more than 150k drivers across the country to answer that question.
But first, let’s get something established: DoorDash drivers prospered in 2020, and they’re on track to totally kill it in 2021.
Of course, DoorDash driver earnings are well-earned rewards for the hard work determined drivers put in. According to the stats we collected last year, the average DoorDash driver (or, in DD lingo, Dasher) traveled anywhere from 75 to 290 miles per day. That’s a lot of mileage, and tons of food, groceries, and other great stuff making its way to customers’ doorsteps.
DoorDash drivers know better than anybody how hard they really work. As this popular delivery service continues to expand into groceries and maybe even more items, there will be a growing number of opportunities for Dashers to earn in 2021.
With the way the COVID-19 caused the delivery business to blow up, the way we see delivery has been completely transformed. That’s why we’re so curious about what will happen in 2021. Here’s what we’ll examine so we can find out:
- How DoorDash Pay is calculated
- How much DoorDash drivers make per hour, per mile, and per trip
- Why DoorDash driver earnings are on the rise in 2020
- Earning trends for April through August 2020
- Estimated expenses for the average DoorDash driver
- How DoorDash drivers can earn even more
How DoorDash Pay is Calculated
The DoorDash pay model is based on what’s called a “black-box algorithm.” This is a set of calculations that weighs the value of a delivery based on time, distance, how easy the delivery is, and other issues. Hence, each delivery has a basic value.
On their website, DoorDash provides the image you see below to explain how driver earnings are calculated.
Base pay is determined by the time, distance, and desirability of the order, and can range from $2 – $10. Longer distances, extended times, and deliveries that are less popular will create higher levels of base pay. The amount a customer wants to tip won’t affect this calculation though.
Promotions enhance earnings, and can be extended during peak times, Challenges reward drivers for completing a certain number of trips within a given time period, or for meeting earnings goals that are set for them.
Dashers can also earn extra with Drive orders, which are large orders that might involve catering or super-size grocery deliveries. Active Dashers can work to qualify to take these orders. They are not available to everyone.
Tips, of course, are at the discretion of customers, and the people you serve can add that extra cash in before or after they receive their delivery. (DoorDash provides suggested tip amounts.)
The standard delivery fee of $5 is covered totally by customers, and they also pay a service fee of 10 percent, which doesn’t include the tip.This represents some portion of DoorDash’s take rate, along with what the restaurants pay to DoorDash.
Promotions geared toward customer discounts will lower a driver’s earnings. That’s because if a customer pays less for the order, the order yields less for the driver.
Hidden pay details can add some trickiness to working for DoorDash. When a call for delivery comes in, the driver sees a guaranteed amount that includes what DoorDash will pay, plus a tip if the customer has paid in advance.
The restaurant name, how far it is from the driver’s location, and how far he or she will have to travel to make the delivery will be shown; but the driver only has 30 seconds to calculate if picking up the ping will be worthwhile. Sometimes, the actual amount will be more than the guaranteed amount, and other times … it won’t. To navigate these situations, Dashers need to rely on their instincts.
Until recently, there was controversy over company policy regarding delivery fees and tips. DoorDash was called out for taking tips the customers gave drivers, and putting them toward the delivery fee paid to the drivers. That has changed, fortunately, and now drivers get to keep 100 percent of the delivery fee, plus any tips they receive.
DoorDash, after the tip and delivery fee debacle, raised the absolute minimum pay for a delivery from $1 to $2. Depending on how far the drives are, how long they take, and how much is in the order, some deliveries can be as much as $10 minimum. In 2019, DoorDash claimed drivers could earn around $18.50 per hour, but as you’ll see from our data shown in the table, most Dashers didn’t not make quite that much.
How much do DoorDash Drivers earn?
For drivers, using Gridwise has even more advantages than ever before. On top of tracking and calculating your earnings and mileage, we collect earnings and mileage figures (anonymously, of course) from all our drivers, and analyze those numbers to figure out how well everybody is doing.
Our information is taken from our more than 150,000 active Gridwise users in various markets across the United States. Because we can get actual -rather than estimated – figures, directly from drivers, our data are very accurate. We don’t simply ask drivers to give us ballpark figures, or have them give us numbers for their best or worst days. We have numbers for every day, so no one can exaggerate or underestimate earnings or mileage.
In our results, the number we work with is the median, rather than the mean. To calculate the median, we look at our sample and take the number that is in the exact middle of the range we collect. In our experience, this has been the most accurate and realistic way to report driver performance.
Also, the earnings figures you see here represent DoorDash drivers’ gross earnings. By this we mean the amount that drivers have earned before taxes and other expenses, but after DoorDash has deducted its share.
DoorDash Driver Median Income April – December 2020
|New York City||$14.13||$1.41||$8.21|
|Salt Lake City||$15.20||$1.05||$7.58|
These numbers do not include tips, which have been more prevalent in recent months. This is largely because of customers showing their appreciation for drivers working in COVID-19 conditions, and also because some tipping controversies regarding DoorDash’s tipping policy have been cleared up.
Another good thing that we can say about tips is that people tip more for delivery than they do for rideshare. Our data show that 85-90 percent of delivery trips include tips. So, how much does DoorDash pay per mile, hour, and trip?
$15.57 per hour
$1.04 per mile, and
$7.97 per trip
These numbers do not include tips, which have been more prevalent in recent months. This is largely because of customers showing their appreciation for drivers working in COVID-19 conditions, and also because some tipping controversies regarding DoorDash’s tipping policy have been cleared up. Learn how to increase your rideshare and delivery driving tips.
Why DoorDash driver earnings are on the rise in 2020
COVID-19 and the resulting shut-downs brought many sad and worrisome elements into our society, but the effect on the delivery business has been extremely beneficial. Before April 2020, DoorDash was a service people used occasionally, either on their own or maybe at the office when it was time for “Taco Tuesday” or “Burger Thursday.”
Since the shutdowns began, Dashers have been busy delivering breakfast, lunch, dinner, and snacks to people who are either unable or unwilling to go out for their restaurant meals. At the same time, other companies have been stepping into DoorDash’s territory, and DoorDash has ventured beyond its own “realm,” as well.
Uber Eats has grown, for example, and Postmates and Grubhub are no longer the novelties they once were. People have taken to delivery in a big way, and there’s no question that DoorDash drivers have seen their business, and their earnings, expand and stabilize since that happened.
Adding rocket fuel to the propulsion system of DoorDash’s business in 2021 is the company’s expansion into grocery shopping and delivery. Learn about DoorDash grocery delivery service. And, keep in mind that people have become so accustomed to getting food and groceries delivered, they’re likely to continue ordering groceries online, even after the pandemic is no longer a concern.
Earning trends for April to August 2020
As this graph shows, earnings hovered around the $15 figure for most of the April to August time period. April and May were the biggest months, and there was a slight downturn starting in August. This could be because some people began to venture out for their meals, or maybe it was just part of the slowdown most transportation network companies (TNCs) see at this time of the year.
Toward the end of year, you can see a boost in driver earnings as volume picked up due to the holidays.
Estimated expenses for the average DoorDash driver
Now comes the part where Dashers may fall from the pinnacle of high earnings per hour, per mile, and per trip. Expenses are a reality for all drivers, and must be taken into consideration when putting together the full economic picture of a DoorDash gig.
The cost of gasoline varies based on market fluctuations, whether driven by supply and demand or by seasonal changes. Your location and the kind of vehicle you drive will also affect how much you spend on fuel. Remember that delivery driving involves two rides: one from the driver’s location to the restaurant, and the other from the restaurant to the customer’s home or office. So, if you drive for DoorDash or another delivery service, you’ll spend more on fuel than the average rideshare driver.
In our article about how much do rideshare drivers make, which drew on a report by MIT, tells us that during 2018 rideshare drivers were spending between $.05 and $.27 per mile on fuel costs.
Insurance costs for delivery drivers might not add much to what you’re already paying for your vehicle’s policy. It is wise, however, to investigate buying additional coverage, since you will technically be using your vehicle for commercial purposes.
Some companies will tack on commercial coverage for as little as $20 per year, so be sure to shop around.
Drivers should also consider the costs of all forms of insurance, including term life insurance. A company called Bestow is making it easy for rideshare and delivery drivers to apply for affordable life insurance from a reputable provider.
If you’re a rideshare or delivery driver in the market for term life insurance, be sure to check out *Bestow.
Maintenance and Repairs
If you want your vehicle to perform reliably, at minimum you’ll be paying for oil changes and tire rotations. Add small repairs and the occasional brake and tire replacement, and costs quickly add up. Many drivers regularly set aside a portion of their earnings to cover these expenses, which is an excellent practice.
You can even calculate what maintenance might cost over five years. On its website, Edmunds offers an ownership calculator that estimates these costs based on national averages.
To help you out with your calculations, or to simply give you some ideas, we will use MIT’s data again to show you what insurance, maintenance and repair costs might cost in a year. They say it would be around $0.13 per mile.
If you’ve ever purchased or sold a used car, you know there are factors you look for when determining the vehicle’s actual value. You can use another easy-to-access Kelley Blue Book tool to see what using your car as a delivery vehicle does in terms of depreciation. The number provided by the MIT study cited earlier is $0.05 per mile.
The total cost
Looking at the costs of fuel, maintenance, repairs, and depreciation, you’ll be spending at least $.30 per mile. Subtract that from the $1.04-per-mile figure we have in our numbers across all markets, and you’re earning $0.74 per mile driving delivery. It might even be slightly less, because your costs will be higher than those of the average rideshare driver as shown in the MIT data.
Don’t feel too glum when you see this figure. Remember that we haven’t added in your tips, any sign-on bonuses you could get, or any referral or incentive programs your company might offer.
One more thing – don’t forget about the Taxman. No one will be deducting taxes from your income, and as an independent contractor, you’re quite likely going to be expected to pay quarterly. Unless you’re super-proficient at doing taxes, investing in the services of a CPA could be worth more than you might care to find out, should you make errors that involve penalties, fines, and even worse tax-related problems.
How can Dashers earn more?
If you decide to drive for DoorDash, the smartest thing you can do is keep track of your earnings and mileage with Gridwise. You’ll be able to see all the same figures we collect as you track your Dashing activity, presented in graphic form that tells the story at-a-glance.
When you download Gridwise, you also get up-to-the-minute news about events in town, weather conditions, and special deals geared toward drivers. Our Perks tab also includes easy access to our blog, which is always filled with the latest news for drivers, and the always-enlightening Gridwise YouTube channel.
Plus, join us on Facebook so you can get in on frequent gas card giveaways. Your dashing will definitely dish out more dough when you ride with Gridwise.
Life insurance quotes provided by Bestow Agency, LLC dba Bestow Insurance Services in CA, who is the licensed agent. Term Life Insurance Policies offered by Bestow are issued on policy form LS181 and LS182, or state version including all applicable endorsements and riders, by North American Company for Life and Health Insurance®, Administrative Office, One Sammons Plaza, Sioux Falls, SD 57193. Products or issues ages may not be available in all jurisdictions. Limitations or restrictions may apply. Not available in New York. North American is rated A+ (Superior) by A.M. Best. Limitations or restrictions may apply. A+ (Superior), the second-highest rating out of 15 categories, was affirmed by A.M. Best for North American Company for Life and Health Insurance as part of Sammons Financial Group on August 19, 2020. A.M. Best is a large third-party independent reporting and rating company that rates an insurance company on the basis of the company’s financial strength, operating performance and ability to meet its ongoing obligations to policyholders. Our application asks about your lifestyle and health to avoid requiring a medical exam.