Pizza Hut, KFC and more 'risk breaching Fair Trading Act' with hidden delivery fees

Consumer NZ has warned hungry Kiwis to watch out for hidden costs with their food deliveries after finding popular restaurants are sneakily charging customers more for each item they get delivered.

On top of delivery and service fees, restaurants around the country are also upping the cost for each item, which the watchdog says risks breaching the Fair Trading Act. 

It has called on businesses to be upfront about their pricing so customers can make informed choices. 

After receiving complaints Consumer investigated misleading pizza delivery prices. The watchdog found that both Pizza Hut and Domino's increase the cost of every item in a customer's order if it's delivered.  

If you call into Pizza Hut to collect a Mega Meat Lovers pizza, it will set you back $15.39. But if you opt to get it delivered, the same pizza costs $18.49, plus a delivery charge of $7.99. The true cost of getting your pizza delivered is actually $11.09.  

And it's not just the pizza that's more expensive either, Consumer NZ said.

The cost of every item in the shopping cart increases if delivery is chosen, meaning customers could end up paying significantly more than if the order was collected.

"We think businesses should be upfront about additional delivery fees so the customer can make an informed decision," said Consumer NZ chief executive Jon Duffy.

"The fact these companies aren't being upfront about the true cost of delivery means they risk breaching the act." 

The practice of increasing prices for delivered items is widespread across New Zealand's food delivery sector, according to the watchdog.

Most customers know they are paying for delivery but they might not know how much more it's really costing them. 

KFC, Taco Bell and Carl's Jr also charge significantly more for each item delivered on top of the advertised delivery fee. The true price of delivery goes up with every item added to a customer's cart. 

Customers told Consumer NZ they believe it is intentionally misleading to have two sets of prices for the same menu, without being clear about the different pricing structure. 

The watchdog said these pricing practices risk breaching the act and it will lodge a complaint with the Commerce Commission.

Customers said they have noticed similar pricing practices when ordering through third-party delivery services, such as UberEats, DeliverEasy, and Menulog. 

Since Consumer NZ's investigation Domino's had added some fine print to its website to let customers know it charges a delivery service fee as well as emailing the customers on its database to let them know about the fee.