Why Use Restaurant Delivery Services?
If you are a restaurant owner or a chef, you know all too well how competitive the restaurant industry is. Even before COVID-19 was unleashed and caused thousands of restaurants to shut their doors, simply being able to stay afloat and turn a profit was challenging.
According to a 2016 survey conducted by CNBC, roughly 60% of new restaurants fail within the first year, and nearly 80% close their doors before their fifth year. The number one cause was cited as poor location, which ultimately means there was interference in a customer’s ability to discover and access restaurants. This remains a challenge for restaurants today, and with strict social distancing regulations in place, another problematic layer is added.
Enter 2020. Fewer people are eating out, let alone leaving their residences due to COVID-19 and their respective state’s laws on social distancing. In addition, laws have changed to promote safe operational guidelines, while often limiting a restaurant’s ability to operate.
Selecting the right restaurant delivery service for your concept can make or break your business, especially now that most states limit restaurant operations to outdoor dining only, with lower capacity. When you are able to implement a restaurant delivery service into your operations, you can expect to see an increase in business due to the following reasons:
- Extend your reach
- Enhance your online / digital exposure
- Increase sales while reducing operational costs
- Create opportunities for more customer reviews
- Boost word of mouth
- Improve your restaurant’s reputation
- Provide job security for your employees
Finding the right delivery service for restaurants is key to achieving the above mentioned points. However, most restaurant owners, chefs and hospitality directors often face challenges in knowing how to choose the right provider.
This article is intended to help restaurant owners, managers and chefs identify the best delivery option to help ensure their business continues to turn an ROI through these turbulent times and continue to grow into the future.
In-House Food Delivery Services: Who Benefits from this Option, and Who Doesn’t?
Unless you have more business than you know what to do with, and you don’t mind taking on a greater insurance liability, in-house food delivery is not the best option for your restaurant. Keep in mind that most delivery services for restaurants run on apps, and these platforms invest in massive marketing campaigns designed to create awareness and prompt locals to place orders at restaurants utilizing the tool.
If you are a well established part of the community that receives ample support from local residents, and your restaurant kitchen is at maximum operational capacity, then hiring a few new employees to run deliveries should suffice. Just be mindful to contact your insurance provider to see how adding delivery drivers impacts your coverage and rate.
On the flip side, if your restaurant is trying to attract more customers, using your own delivery service could be a big mistake. When you invest in one of many restaurant delivery services, you aren’t simply benefiting from the ability to deliver your menu items, you are also engaging with a service that promotes your restaurant in front of a wide audience based on important criteria to your customers. These points can range from cuisine type, price, reviews, location, promotions, and delivery time.
Choosing the Right Food Delivery Service for Your Restaurant
Restaurant owners have a number of options to consider when it comes to delivery services. The most popular choices include:
When vetting these services, you will want to do a little research to see exactly how utilizing the proposed service could impact your bottom line, even if it will increase your orders. When looking for a restaurant delivery service that will actually help your business grow, look for the following factors:
- Reach – What methods does the delivery service use to stay visible?
- Competition – To what degree are you competing with similar restaurants in the area, and how does the service ensure you will see a significant increase in business?
- Cost – Is there a flat monthly or annual rate, or does the service take a percentage of your earnings? What is that percentage rate?
- User friendliness – Is the platform easy for your customers to use?
- Tech integration – Does the platform integrate with your existing software, or do you need to manage these orders from the specific platform?
When it comes to reach, you will want to consider delivery services that cover a reasonable local radius. For example, if the delivery service is limited to a two-mile radius, you could be missing out on a greater degree of business. Look for a service that operates within five to 10 miles.
Cost is another huge concern. Recently, a number of media publications have released articles warning restaurants on predatory practices used by certain food delivery services. For example, Uber Eats and Grubhub take 40% of the revenue earned from every order. Many restaurants are forced to increase their menu prices simply to compensate for the drainage on their earnings. Often, customers are turned off by the increase in prices and look for more affordable options while having a negative view of the restaurant. At the end of the day, the number of people willing to pay $40 for a pizza or $20 for a burger (remember, they also need to tip the driver) are far and few between.
User Friendliness Matters for You, and Your Customers
When you partner with a restaurant delivery service that has a user-friendly platform, you will see an improvement in your own efficiency, as well as an increase in orders. When food delivery apps lack vital features or are difficult to use, more people are likely to phone in asking for delivery ETAs, or they call to give specific instructions on the orders they placed.
When customers call to tell a restaurant their gate code, or to avoid using a certain ingredient, employees spend more time on the phone when they could be performing other functions. Furthermore, ongoing internal messaging at untimely moments can create a greater risk for making mistakes to an order.
Make sure to consider restaurant delivery services that have fields where customers can add special requests on order preparation, as well as notes for the delivery driver. It is also ideal to use a service that has real-time order tracking and live delivery maps showing the driver’s location and ETA.
Make Your Decision and Start Increasing Your Business Today
Two heads are better than one. It is always ideal when the restaurant owner and head chef can get together and make an executive decision on which delivery service to use.
The chef will have valuable insight into output and how it might be impacted by various features offered by a delivery service. In addition, the owner will likely have the operational costs and other critical figures that play into which option would best support the business.
Be sure to visit each delivery provider’s website, set up a call for a consultation (if offered). It is also valuable to see what other restaurants have to say about various delivery services.
Your ability to make an ongoing profit, delight your customers, and enhance your restaurant’s visibility and reputation will hinge on finding the right delivery service, especially in this challenging climate. Start by making your short list today and find a provider you can partner with to up your game and presence.