Back in 2016, food delivery made up only seven percent of restaurant sales. Analysts at Morgan Stanley predicted that that number could eventually climb to over forty percent within the next two years.
Whenever you talk to a single person, they always mention the “apps” dominate their dating life. From Tinder to Bumble, Hinge, or whatever new apps come on the scene, they’re taking advantage of the ecosystem to meet people. Like the world of dating apps, the world of food has been rocked by delivery apps. NPD Group Market Research cited that over fifty percent of takeout orders happen online via a delivery app.
From DoorDash to GrubHub, Postmates to Favor, there are cars out on the road hustling from office to office or just to make sure someone who’s sick is getting their pho. If you’re a ‘mom and pop’ burger shop, or make a badass gyro, are a sushi master, if you’re not using the delivery apps, you’re leaving money on the table.
Adopting a delivery side of the business will require more planning, considering the stream of orders that will be coming in. Still, more and more places are utilizing the method because it’s driving so many businesses’ growth. Hudson Riehle, senior vice president of the National Restaurant Association’s Research and Knowledge Group, stated, “The majority, 63 percent of restaurant traffic now is off-premises.”
If you’re considering putting your business on one of the apps like Caviar or UberEats, there are a few things you need to keep in mind.
There are fees
The food industry has notoriously slim margins, and when someone uses delivery apps, there will be a fee to pick up the order, but there’s also a charge to deliver the food to the customers. Depending on the provider, the cost can be anywhere from ten to thirty-five percent on order. Sure, that fee could be higher because of a higher placement within the app, but you lose three dollars out of a ten-dollar order.
The way that the delivery apps combat this is that they increase overall margins, and more orders are being pumped in – on top of established foot traffic. This is an interesting paradigm because there still needs to be a traditional model if a restaurant wants to make its money on the backs of items like soda and liquor, which have a high markup.
You’ll need a system
A lot of kitchens are splitting the difference in how they’re working. There are folks serving guests seated or taking out orders, and there’s the people who are bagging and packaging food, making sure everything travels well. From what sauces to suggest to chopsticks, there’s someone working on making sure the orders are correctly placed.
You’re going to need an additional set of hands, or three. (We can totally help with that.)
Because of the uptick in orders, this might be a good way to bolster business. For some places, everything about their business model has changed thanks to so many people wanting more than just pizza or Chinese, which traditionally, all that was available for delivery.
Getting your food online is a win. But, it’s also a matter of what are your long-term goals are – like other on-demand additions to our lives, there’s no going back now. If you want more people tasting what you’re creating, this is just an expansion of getting the food into new hands. We’re smoothing out processes across the board, what is considered normal today won’t be in five years for many industries. And really, when you’re sick of eating your own food, you can get something delivered to your kitchen you might have never considered trying. Community supports community, and there’s a lot to like about that.
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