Restaurant delivery operations might be ESSENTIAL for your restaurant to survive the crisis brought on by the new coronavirus (COVID-19).
Delivery Is Essential, Not Just Important
Over the past few years, restaurant delivery has boomed. Now, more than ever, is time to make sure your restaurant delivery operations are effective and profitable.
Back in 2016, delivery transactions only made up about 7% of total U.S. restaurant sales. But, this number has the possibility of reaching 40% of sales, depending on the location of the restaurant.
Delivery adds an additional revenue stream that can either be controlled in-house or by third-party services. Think about what you’re currently doing. What is and isn’t working? Could your process be improved? Do you even have a process?
Let’s take a deeper dive into the complicated, but essential, aspects of a restaurant’s delivery operations:
Adding delivery immediately makes your restaurant more accessible by attracting more local customers and more off-premise orders.
In a world where you can purchase almost everything through a website or mobile device, you are encouraged (if not required) to add online ordering to your website for both delivery and restaurant takeout.
If you don’t have a website, you can use a platform to communicate your restaurant’s menu for customer convenience. Adding online ordering allows you to receive orders faster, with higher ticket averages, and from more loyal customers.
According to surveys, 51% of Americans use delivery services to purchase meals from casual dining restaurants, and 26% order takeout or delivery at least once a week. With online ordering, it’s easier to receive orders, with the customer’s address, phone number, and other information automatically included.
Incorporating delivery as part of your normal operations can come with a hefty cost. Many third-party delivery services charge fees exceeding 25%. So, if a significant portion of your business comes from these services, the fees won’t be sustainable.
Do you handle delivery in-house? Or, do you bring in third-party delivery services to make deliveries?
If you decide to use a third-party service, do your research. Crunch your numbers to determine what loss or gain you will take by bringing in an outside party. If done correctly, using your own delivery drivers can be more profitable, assuming you have enough delivery volume. However, third-party delivery services may be able to provide your restaurant extra exposure. A hybrid approach may be ideal for your restaurant.
Most restaurant profit margins are less than half of the fees third-party services charge. In a world where ALL of the orders coming from third-party delivery services are incremental, those fees are affordable. BUT, in the real world, where routine customers place orders over and over again, the fees will not be sustainable.
Your Restaurant’s Brand
It’s important to consider how your business is perceived by customers. Using a third-party service means you take a risk by having people outside of your business ultimately represent your brand. You have no control over any issues that might arise as a result of a negative experience. Additionally, it has been found that customers aren’t loyal to a third-party service when ordering food online.
Customers have been brainwashed to believe they are entitled to free delivery. The reality of food-delivery, however, is completely different. Making sure an order is delivered quickly, and still hot, is not a cheap proposition for restaurants. These expenses cannot be fully absorbed by restaurants. As a result, some fees need to be passed along to customers to make the process sustainable. This challenge is something all restaurants face.
With the additional crisis restaurants face from the coronavirus outbreak, delivery is even more important. Therefore, restaurants need to make sure they are MAKING money from delivery to survive a downturn.
You may have the opportunity to create a better brand experience and build customer loyalty with your own delivery service.
Do you think your customers will receive a more positive experience through you and your team? Or, do you want this to be handled by someone outside of your establishment? At the end of the day, it’s all about your customers. So, think about what’s best for them when making the decision.
The importance is doing something. As the industry transitions and adapts to the COVID-19 crisis, your restaurant needs to meet the needs of customers. This mean helping them enjoy your food off-premise.
Restaurant delivery operations are tough to master, but critical. Offering local customers access to takeout and delivery will help your restaurant through tough times.
Activate Your NetWaiter Site
If you want to attract more local customers and keep them informed about your restaurant, check out NetWaiter’s marketing platform and network. You can search for, and activate, your NetWaiter site and app for free here: