Delivery packaging and the hidden costs of getting it wrong

You've run the commission math. You know DoorDash takes 25%, Uber Eats takes 25%, SkipTheDishes takes somewhere in between. You've probably even tracked what you net per delivery order after the platform takes its cut. Good.

But there's a second cost most operators never model separately: packaging. Containers, utensils, bags, insulation, napkins, tamper-evident seals. It adds up to CA$3-5 per delivery order. On a $45 average order where the platform already took $11.25 in commission, that packaging cost just ate another 7-11% of your revenue.

And packaging has a second failure mode that commissions don't. When it fails, you pay twice: once for the food, once for the refund.

The short version: Delivery packaging costs Canadian restaurants CA$3-5 per order on top of platform commissions. That's 8-10% of total operating costs for food service operations, and higher for independents who can't buy in bulk. When packaging fails, refunds and chargebacks eat another 2.5-3% of total delivery revenue. Canada's single-use plastics ban is pushing costs higher, not lower. Here's how to get the packaging line right.

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What packaging actually costs per delivery order

The food service industry spends 8-10% of total operating costs on takeout packaging. For small independent restaurants, that proportion is higher because you can't negotiate bulk pricing the way a chain can.

Here's what a typical delivery order costs in packaging, per item:

Item	Cost range (CAD)
Entree container (clamshell or bowl)	$0.25-0.50
Side container	$0.15-0.30
Utensils + napkin bundle	$0.10-0.25
Bag (paper or insulated)	$0.30-0.75
Tamper-evident seal/sticker	$0.05-0.10
Sauce cups, extras	$0.10-0.20
Single-item order total	$0.95-2.10

Most delivery orders aren't a single item. A two-entree order with sides, drinks, and a bag pushes the real total to CA$3-5 per order, especially if you're using compostable or eco-friendly containers.

If you're on eco-friendly alternatives (and Canada's regulations increasingly require it), add 10-70% depending on the material. Compostable cutlery and straws carry a 50-100% premium over conventional plastic. Paper bags and aluminum containers sit closer to 10-20% above standard.

For a typical independent running 30-50 delivery orders per day, packaging costs CA$1,000-3,000 per month. That's rent on a parking spot in most Canadian cities. Except nobody negotiates their packaging costs the way they'd negotiate rent.

The compliance squeeze: Canada's plastics ban

If you haven't updated your packaging since 2022, you might already be out of compliance.

Canada's Single-use Plastics Prohibition Regulations ban the sale of six categories of single-use plastic items: checkout bags, cutlery, stir sticks, straws, six-pack rings, and foodservice ware made from expanded polystyrene foam, PVC, carbon black, or oxo-degradable plastics. The sales prohibition has been in effect since December 2023.

What that means in practice: foam clamshells are gone. Plastic cutlery is gone. Those cheap plastic straws are gone. The alternatives (wood, paper, moulded pulp fibre, PET, polypropylene) cost more.

BC has its own additional regulation on top of the federal one. And packaging compliance requirements are tightening further in 2026, with auditable reporting moving closer to daily restaurant operations.

This isn't optional. And the cost pressure runs in one direction: up.

The small comfort: 60% of consumers say they'll pay more for sustainable packaging, and 74% prefer restaurants that use eco-friendly options. Whether that translates into actual order behaviour on a delivery app is a different question. But the regulatory floor is set, and you're building on top of it.

When packaging fails: the refunds you pay for

Here's where packaging costs get truly expensive. Bad packaging doesn't just waste money on containers. It creates refunds.

When a delivery customer opens a bag and finds their soup leaked, their fries are soggy, or their salad is wilted because the container didn't seal properly, they request a refund through the app. And the restaurant almost always pays.

The responsibility split works like this: restaurants pay for missing or incorrect items and food quality issues. Platforms cover late deliveries and damage caused by their drivers. Packaging failures sit in a grey zone. If the food arrived damaged because the container couldn't handle the trip, the platform often approves the refund and deducts it from your payout.

The numbers are worse than most operators realize:

• 2.5-3% of total restaurant revenue gets caught up in delivery disputes. That's roughly 20% of already slim delivery profits.
• Third-party delivery apps see a 3% chargeback rate, 20 times the 0.1-0.2% industry average for first-party restaurant orders.
• Business owners estimate one-third of their delivery refunds are fraudulent. But telling the difference between a legitimate packaging failure and a fraudulent claim takes time you don't have.

Disputing a single order can take 20 minutes. One McDonald's franchisee contests an average of CA$500 worth of delivery refunds per location every month. For an independent without a dedicated admin person, that time cost is real and unrecoverable.

The full delivery cost stack

Most operators think about delivery costs as "commission." The real stack looks different.

Take a CA$45 delivery order at a 25% commission rate with 32% food cost:

Cost layer	Amount	% of order
Platform commission (25%)	$11.25	25.0%
Food cost (32%)	$14.40	32.0%
Packaging	$2.50	5.6%
Refund/chargeback allowance (3%)	$1.35	3.0%
Total cost	$29.50	65.6%
What you keep	$15.50	34.4%

That $15.50 hasn't covered labour, rent, utilities, insurance, or any other overhead. And it's before GST/HST implications on the platform's commission cut.

Compare that to the same $45 as a dine-in cover: no commission, no packaging, far lower refund rates. The restaurant keeps $30.60 before overhead. Nearly double.

If you want to see how this math works with your specific numbers, check our Delivery Profitability Calculator. Plug in your actual food cost, commission rate, and average order value. The packaging line is the one most operators leave at zero. Don't.

For the full commission breakdown by platform (DoorDash, Uber Eats, SkipTheDishes), see our complete commission math article.

Six ways to reduce delivery packaging costs

This isn't a "quit delivery apps" article. Delivery can work. But the packaging line needs the same attention you give to food cost. Here's what actually moves the needle for independents.

1. Audit what you're actually spending. Pull your last three months of packaging invoices. Divide total cost by total delivery orders. If you don't know your per-order packaging cost, you can't manage it. Most operators are surprised by the number.

2. Right-size your containers. Over-packaging is the most common waste. A bowl of pho doesn't need the same container as a burger. Match container size to the actual dish. One container with a divider costs less than two separate containers.

3. Build a delivery-specific packaging kit. Don't use the same containers for walk-in takeout and delivery. Delivery containers need to survive 20-40 minutes of transport. That means sealed lids, insulated bags for hot items, and rigid containers for anything that could shift. Investing CA$0.15 more per container prevents CA$15 refunds.

4. Negotiate with your supplier on a quarterly schedule. Even at 30-50 orders per day, you have enough volume to ask for better pricing. Get quotes from three suppliers, compare per-unit costs, and commit to quarterly purchasing. Canadian distributors offer tiered pricing that gets better as you commit to consistent volume.

5. Stop including extras by default. Utensils, napkins, condiment packets, extra sauce cups. Unless the customer requests them, they're waste. Most delivery apps let you make these optional at checkout. This alone can save CA$0.15-0.30 per order.

6. Track refund reasons weekly. If "food arrived damaged" or "item missing" appears more than 3% of the time, you have a packaging problem, not a fraud problem. Fix the packaging first. Dispute the fraudulent claims second. Your platform merchant portal shows refund reasons by category. Check it every Monday.

The bottom line

Delivery packaging is the cost most operators absorb without measuring. CA$3-5 per order, multiplied by 30-50 orders per day, multiplied by 30 days, is CA$2,700-4,500 per month. Add chargebacks and refunds on top. Add the compliance cost of Canada's plastics regulations.

The operators who make delivery profitable are the ones who treat packaging as a managed cost line, not an afterthought. Audit it, right-size it, negotiate it, and track the refund rate it creates. The same discipline you apply to food cost belongs here.

If you haven't modelled your full delivery cost stack yet (commission + food cost + packaging + refunds), start there. You might find delivery is still worth it. You might find it's worth it at a different price point, or with a different menu, or on a different platform. Either way, you'll know. And that's the only number that matters: the one you've actually calculated.

Sources: Sumkoka, Restaurant Business Online, Craver, Canada.ca, Restaurants Canada, Restaurant Dive.

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