When customers start asking if you deliver, you face a real decision: do your own local delivery, or list on a third-party app like DoorDash, Uber Eats, or Grubhub? The apps promise instant reach and someone else doing the driving, which sounds great until you see the commission, often 15 to 30 percent of every order, which can erase the thin margins food already runs on. In-house delivery keeps your margin and your customer, but the driving is on you. This guide walks through in-house delivery versus a third-party delivery app, so you can pick the model that actually fits your food business.
The short version: Third-party delivery apps give you instant discovery and handle the logistics, but they typically take 15 to 30 percent of every order and keep the customer relationship, no name, email, or phone for you. In-house delivery keeps your full margin and your customer data and gives you total control, but you do the driving within a limited local radius. For high-margin, local, or perishable food, and for owning repeat customers, in-house usually wins. Third-party apps make sense mainly for ready-to-eat, restaurant-style products chasing discovery, and many cottage food vendors can't use them anyway, since cottage food often must be sold direct to consumers. Homegrown gives you a direct storefront with local pickup and delivery, so you keep the margin and the customer. This is general information, not legal advice.
This guide covers the tradeoff, app costs, when each fits, cottage food eligibility, the hybrid model, which to choose, and mistakes. This is general information, not legal advice.
The tradeoff is margin and ownership versus reach and convenience: in-house delivery keeps your money, your customer, and your control, while a third-party app gives you instant reach and logistics but takes a big cut and the customer relationship. That's the whole decision in one line.
Here's how the two compare:
| In-house delivery | Third-party app | |
|---|---|---|
| Cost per order | Your gas, time, and vehicle | 15 to 30 percent commission, plus fees |
| Reach | Your existing audience and local area | The app's whole user base |
| Customer data | You own it, name, email, phone | The platform keeps it |
| Control | Full, packaging, timing, quality | Limited, the platform sets much of it |
| Best for | Local, high-margin, repeat customers | Ready-to-eat products chasing discovery |
What each side really means:
The takeaway: in-house wins on margin and ownership, apps win on reach and hands-off logistics, and that's the core choice. The rule is to decide based on whether protecting margin and owning customers matters more than instant reach, which for most small food businesses it does.
Third-party delivery apps commonly charge 15 to 30 percent commission on every delivery order, which is the single most important number in this decision. For food already running on thin margins, that cut can wipe out most or all of your profit per order.
What the commissions really look like:
That's why the commission is the core economic argument against apps when your margins are tight. The takeaway: third-party delivery commonly costs 15 to 30 percent per order, which can eliminate your profit on food, so run the per-order math before signing up. The rule is to calculate what a 20-to-30-percent cut does to your real cost per item before you list, not after.
In-house delivery makes sense when you're hyperlocal, your products are high-margin or perishable, and you want to own your customers for repeat business. For most small and cottage food vendors, this describes them well.
When in-house is the right call:
The takeaway: in-house delivery is the strong choice for local, high-margin, relationship-driven food businesses, which most cottage vendors are. The rule is to keep delivery in-house when protecting margin and owning customers matters, using a smart local delivery setup to keep it manageable.
Third-party apps make sense mainly when you want discovery beyond your own audience, sell ready-to-eat restaurant-style food, and have enough volume and margin that the reach outweighs the commission. They're built for a specific kind of business, and it's usually not a cottage food one.
When apps can be worth it:
The takeaway: third-party apps fit ready-to-eat, discovery-hungry, higher-volume operations that can absorb the commission, not most small packaged-food or cottage businesses. The rule is to use apps only when the reach genuinely outweighs the commission and your product and license fit them.
Often no, because third-party delivery apps are generally built for licensed restaurants, and cottage food laws frequently require direct-to-consumer sales, which a third-party reseller may not satisfy. This is a crucial check before you even consider listing.
What to understand about eligibility:
The takeaway: many cottage food vendors are structurally excluded from third-party delivery apps, which makes in-house and direct delivery the practical, compliant path. The rule is to confirm your state's direct-sale rules before considering an app, and to lean on your own cottage food delivery instead.
Yes, the strongest setup for many food businesses is a hybrid: your own storefront with local pickup and in-house delivery as the primary channel, and third-party apps only as a supplemental discovery tool if you're eligible and can absorb the commission. This captures margin and ownership while still allowing some reach.
How the hybrid works:
The takeaway: a direct-first hybrid gives you the best of both, margin and ownership as the base, with optional app reach on top for those who can use it. The rule is to build on your own direct channel and treat apps as a discovery add-on, never the foundation.
For most small and cottage food vendors, in-house or direct delivery is the right primary choice, because it protects your margins, keeps your customers, and fits how cottage food is legally sold. Third-party apps are a situational supplement, not the default.
How to decide:
The takeaway: pick in-house or direct delivery as your foundation, and add third-party apps only when they clearly earn their commission. The rule is to protect margin and own your customers by default, which for a small food business means direct, complementing a pickup-and-delivery mix that fits you.
The mistakes with delivery are letting app commissions destroy thin margins, never capturing customer data, over-extending your in-house radius, and assuming you're eligible for apps. Each is avoidable.
The mistakes to avoid:
The takeaway: the mistakes come from ignoring the commission math, giving away the customer, over-extending, and skipping the eligibility check, all preventable. The rule is to run the numbers, own your customers, keep your radius tight, and confirm your eligibility before choosing a channel.
The whole case for in-house delivery, protecting margin and owning the customer, comes down to selling direct, and that's exactly what a direct storefront is built for. Homegrown is a $10-per-month online storefront, with no percentage fees beyond standard payment processing, where customers order directly from you for local pickup or delivery.
Because you sell direct, you keep the full value of every order minus standard processing, no 15-to-30-percent delivery commission skimming your margin. You also get your customers' information and order history, so you can build repeat business, offer pickup and your own local delivery, and nurture the relationship, all the things a third-party app takes away. A flat monthly price means your delivery revenue stays yours, order after order, instead of being eaten by per-order commissions.
To be clear about what Homegrown does not do: it is not a delivery network and does not provide drivers or handle your logistics. Your own local delivery or pickup is yours to run. What Homegrown gives you is the direct storefront that keeps your margin and your customer relationship, so in-house delivery works the way it should, profitably and on your terms. To keep delivery direct and own your customers, set up your Homegrown storefront and sell straight to the people who buy from you.
Third-party delivery apps commonly charge 15 to 30 percent commission on every delivery order. DoorDash, for example, publishes delivery plans at 15, 25, and 30 percent, and Grubhub and Uber Eats structure their marketplace fees in a similar range, with lower rates for pickup or self-delivery options. On top of the commission, you typically still pay payment processing. For food that already runs on thin margins of 10 to 25 percent, a 15-to-30-percent commission can erase most or all of your profit on a delivered order, which is why the commission is the central factor in deciding whether apps make sense for your business.
For most small and cottage food vendors, yes. In-house delivery keeps your full order margin minus your own driving costs, gives you the customer's contact information for repeat business, and lets you control packaging, timing, and quality, though you're limited to a local radius. Third-party apps give you instant discovery and handle logistics, but they take 15 to 30 percent per order and keep the customer relationship. If you're hyperlocal, margin-conscious, or want repeat customers, in-house usually wins. Apps make more sense for ready-to-eat restaurant food chasing reach, with enough volume and margin to absorb the commission.
Often no. Third-party delivery apps are generally built for licensed restaurants with a commercial kitchen and health permit, which a home cottage food operation isn't. On top of that, many cottage food laws require you to sell directly to consumers as a condition of operating under their lighter regulatory tier, and selling through a third-party reseller can conflict with that requirement, potentially putting you outside your permit's terms. Because rules vary by state, confirm your own state's cottage food requirements before assuming you can list on any app. For most cottage vendors, direct sales with in-house delivery or pickup is the practical, compliant path.
Keep your delivery radius tight, price delivery to cover your real costs, and batch orders where you can. In-house delivery isn't free, your gas, time, and vehicle wear all cost money, so charge a delivery fee that covers them rather than absorbing the cost. Resist the urge to extend your radius "just one more mile," since drive time and cost add up fast and don't scale. A pre-order model with scheduled delivery runs, where you deliver a batch of the weekend's orders in one trip, is far more efficient than on-demand delivery and fits a small food business well. Profitability comes from a tight zone and delivery pricing that reflects your true costs.
A hybrid can work, but build it direct-first. Make your own storefront, local pickup, and in-house delivery your primary channel, since that protects your margins and keeps your customer relationships. If you're a licensed, eligible business with room in your margins, third-party apps can supplement that as a discovery tool to reach new customers, but they shouldn't be your foundation. For any customers you win through an app, encourage them to reorder directly next time, where you keep the full margin and the relationship. The goal is to use apps for reach where it helps while keeping the bulk of your business direct.
Because food margins are often thin, commonly 10 to 25 percent, and a 15-to-30-percent commission is larger than the whole margin on many orders. That means a delivery through an app can not only wipe out your profit but actually cost you money once you add payment processing on top. For a restaurant with volume and pricing built to absorb it, that cut can be worth the reach. But for a small or cottage food business with tight margins and lower volume, the commission is often unsustainable, which is why keeping delivery in-house and direct, where you keep the full order value, matters so much for staying profitable.
Choosing how to deliver comes down to what you value most: the reach of an app or the margin and customer ownership of doing it yourself. For most small food businesses, and nearly all cottage ones, direct delivery protects both your profit and your relationships. Run the commission math, own your customers, and keep it local. Start your Homegrown storefront and keep your delivery, and your margins, in your own hands.
