In the past, full time employees and students would take side jobs delivering pizza to earn a few extra bucks. And it could be a great way to make some extra income!
Today, you can deliver for almost any food chain by becoming a “Dasher” or a driver for DoorDash. Is becoming a Dasher the right side hustle for you?
If you're not in a the know, DoorDash is an app that allows you to order food from a huge variety of restaurants. It's a competitor to Uber Eats and Grubhub.
We’ll explain the basics, explain average earnings, and how you can hack the system to earn more. You can also read how DoorDash compares to the Best Side Hustles here.
If you just want to get started, sign up with DoorDash here >>
- DoorDash is a food delivery service where you can earn on your own terms
- You get paid 100% of the delivery fee plus boosts and tips
- They are growing fast and can be a great source of side income
How Does DoorDash Work?
DoorDash is a food order delivery service. Customers place an order at one of dozens of restaurants, and then they agree to a delivery fee and tip. The app then pushes orders to “Dashers” who are logged into the app.
Once you accept an order, you drive to the restaurant, place the order, bring the order back to your car and deliver it to the customer.
All the directions for the delivery are inside of the DoorDash app.
DoorDash Pay: Delivery Fee + Tips
As a Dasher, you get to keep 100% of the delivery fee, any boosts and the customer’s tips. DoorDash makes money by charging restaurants a percentage fee of every order.
As a Dasher, you not only need to keep an eye on your bottom line, you need to be sure that you’re creating value for everyone involved. That means, you need to keep an eye on your customer rating. Every customer rates you on a scale of one to five stars; better and faster customer service usually yields a higher rating.
You also need to keep close to a 100% completion rating. That means if you accept a job, you need to complete it. Failing to complete a delivery could mean you’ll lose your job as a Dasher.
Finally, you’ll need to keep an eye on your acceptance rating. The acceptance rating is the percentage of jobs you take relative to the number of jobs DoorDash offers to you. While you need to be strategic about maxing your earning potential, you’ll may need to take subpar jobs from time to time just to keep DoorDash happy.
DoorDash Bonuses: You'll often see bonus offers in the app if you meet certain criteria. These can even be just for driving at certain times. They also have peak pay for driving and delivering during peak times, like dinner.
What Costs Do You Cover?
As a Dasher, you have to pay for all your business expenses. That includes data for your phone, gas, car insurance, wear and tear on your vehicle, and both sides of self employment tax.
If you decide to become a Dasher (or a driver of any kind) be sure to install an app like Everlance to keep track of all your expenses.
And when it comes to tax time, you need to make sure that you accurately report both your income and your expenses. If you don't keep track of your expenses (and don't report them), you could be overpaying in taxes. You only pay taxes on your net earnings after expenses. So, DoorDash will send you a 1099-MISC, but then you need to self report your expenses like mileage on a Schedule C.
Check out our guide to the best tax software to find the best options for side hustlers.
How Much Can You Expect To Earn?
Since DoorDash only operates in large metro areas, most Dashers don’t need to put tons of miles on their car to earn a decent income. Rates really depend on how many miles you have to drive, the size of your orders, and how quickly you can complete orders.
On the website, DoorDash advertises that you will earn between $15-$25 an hour. Most drivers who post videos to YouTube claim that they earn between $7-$10 per delivery, and they average 2-3 deliveries per hour. Of course, when you’re just learning the ropes, you may have some trouble figuring out how to maximize your deliveries, so you might earn closer to $9-$10 per hour at first.
The great thing about DoorDash is it's rapidly growing. They are both adding more cities, and adding more restaurants all the time. This means that there will be more users, which means more potential to earn.
DoorDash is always looking for new drivers, especially in certain cities, and especially with the pandemic increasing demand. As such, sometimes you can get huge promotion or bonus offers when you sign up.
DoorDash Driver Sign-Up Bonus
In some cities right now, you can get up to $750 when you sign up. It all varies by city, so make sure to check your city before you submit your application to see if you qualify for anything. Also look at the terms and conditions - you typically have to make a minimum number of deliveries to qualify for the cash bonus amount.
DoorDash Referral Bonus
Once you sign up to be a driver, you'll be able to get paid for referring other drivers. Inside the DoorDash app, you'll get a referral code that you can pass on to others.
The amount you'll get also varies by city. One your referred driver makes the minimum number of deliveries to qualify, you'll get a bonus!
DoorDash New Consumer Bonus
If you're looking to be a new customer of DoorDash, they run special promotions all the time!
Right now, they are offering new customers free delivery on their orders for the first month. That can be a pretty good savings depending on how much you order!
How You Can Earn WAY More Than Average
While most people earn just a little extra cash driving for DoorDash, some drivers earn $40 or more per hour. Here’s how they report to do it.
There's also a great DoorDash Reddit where you can learn from and find tips and tricks from other DoorDash drivers: https://www.reddit.com/r/doordash/
You can also learn some things to avoid as well!
How DoorDash Compares To Its Competitors
DoorDash is not the only food delivery service out there, but it has been rapidly growing and it sets itself apart in several ways. As a consumer, the biggest way it sets itself apart is the quantity and quality of restaurants on its app.
If you want to become a Dasher, here's how it compares:
DoorDash vs. Grubhub: As a driver, GrubHub pays a flat fee per order, plus 100% of your tips. DoorDash is similar, but since they don't have a flat fee per order, there is potential to earn a bit more. DoorDash has peak pricing and other bonuses that can incentivize drivers.
DoorDash vs. Uber Eats: Uber Eats has one of the more complicated formulas for how it pays its drivers. Drivers are paid for each delivery based on an equation that contains a pickup fee, a drop-off fee, and a mileage fee that covers the distance from picking up the food to dropping it off at the customer. Drivers receive 100% of any tips customers leave in the app. DoorDash has a much clearer approach to pricing, but mileage will vary on which is better.
DoorDash vs. Postmates: Postmates does deliver a bit more than food, but it's still considered a courier service. For Postmates, drivers are paid out for the deliveries they complete according to the formula for their city. The earnings include: An amount for each completed pick-up, an amount for each completed drop-off, a per-minute-waited rate for the time you spend at the pick-up location, a per-mile rate for the distance between the pick-up and drop-off locations, any blitz bonuses that are shown when you accept a delivery, and 100% of the tips you earn.
Should You Become a Dasher?
Driving for DoorDash is a decent way to earn some cash on the side. It’s nice that you can use some business savvy to boost your bottom line (unlike some of the other gig economy apps).
If you’re looking for a part time job that you can do on your own schedule, DoorDash fits the bill. I would still prioritize work on your main career above a side job like DoorDash, but it’s one of the better ways to drive and earn.
Would you ever consider working for DoorDash? Why or why not?
- Ease Of Use
- Company Support
- Income Potential
DoorDash is a great way to earn a side income for delivering items! You can get paid to deliver food and other items, plus bonuses and more!
- A flexible way to earn extra money on your own schedule
- Rapidly growing demand for drivers
- No commitments required, just do it on your own time
- You may not net (after expenses) as much as advertised, it does vary greatly
Robert Farrington is America’s Millennial Money Expert® and America’s Student Loan Debt Expert™, and the founder of The College Investor, a personal finance site dedicated to helping millennials escape student loan debt to start investing and building wealth for the future. You can learn more about him on the About Page, or on his personal site RobertFarrington.com.
He regularly writes about investing, student loan debt, and general personal finance topics geared towards anyone wanting to earn more, get out of debt, and start building wealth for the future.
He has been quoted in major publications including the New York Times, Washington Post, Fox, ABC, NBC, and more. He is also a regular contributor to Forbes.