If you’re going to do something, do it right or not at all.
Easier said than done, isn’t it? Especially when the “something” you’re doing is hardly optional and radically transforms the business model you’ve had for decades.
Yeah, we’re talking about the…ahem…challenge of online ordering and food delivery apps.
All over the country, small businesses are going through the seven stages of coping with this new facet of the business. You’ve probably experienced denial (until the thousandth customer asked why you don’t deliver), anger (when the third-party driver earns you a bad review for cold food), and depression (when your orders go up, but your profits go down).
If you’ve reached bargaining or acceptance, you might be wondering how to make the best of this brave new world.
There is no single solution to food delivery apps’ unique challenges. It depends on your business model, how good your word of mouth is, and your personal preferences or vision. How much delivery business do you want or need to do? How much are you willing to transform your business?
Ultimately, every restaurant owner needs to decide for themselves what will help them succeed and how. But here are some of the solutions that other restaurateurs are turning to, all over the country.
Tip #1: Set Aside Staging Space
This one’s a must if your delivery volume is significant at all. You need room for delivery orders to wait for the drivers and probably some room for the drivers themselves.
It can be as low-investment as adding a shelf to the wall, or as extensive as additional hot/cold holding equipment. Give thought to where delivery drivers can wait, should that be necessary, and consider a separate card processing center to expedite the payment process. Examine the workflow in your kitchen from a new angle, because now you need to account for two workflows: dine-in and delivery.
Some restaurants are sacrificing kitchen or office space, some are transforming parts of their dining room for delivery staging. Consider what’s best for your layout, traffic, and demand.
Tip #2: Modify Menus for Delivery
You know some foods just don’t deliver well. That’s something a customer might not understand. If you give them the option of ordering a dish that doesn’t travel from the menu, they’re bound for disappointment. And they’ll take it out on your rating.
Luckily, there’s nothing that says you have to offer your entire menu for delivery. Do a little research about what delivers well and what doesn’t. Pay attention to what’s received consistent complaints from delivery customers in the past. When in doubt, you can do a road test—have the food sit on the shelf and then the car for your average order times to see for yourself how each dish holds up.
You should also consider adding items to your menu that can be delivered in better condition. The heavier your delivery traffic, the more tailoring you need to do.
Tip #3: Consider Your Packaging
If you’re using third-party delivery apps, the drivers have zero stake in making your restaurant look good. If they’re clumsy with your order or take an hour to deliver it, the customer will probably blame you (as unfair as that is). Plus, you can’t expect third-party drivers to have an insulated bag for the trip.
That gives you two important considerations for your packaging: sturdiness and temperature retention. Look for packaging options that close securely; then find ways to package your food that will keep hot things hot and cold things cold.
Tip #4: Choose Control
You need a system for controlling your delivery orders so that they don’t control you. Your strategy will depend heavily on your delivery volume, your dine-in business, and the proportion and predictability of both.
Restaurants that have gone all-in on delivery sometimes hire a designated staff member to run a “delivery command center.” Essentially, they manage the orders coming in from various apps, as well as direct call-in orders, and enter them into your POS software. Restaurants schedule them during the prime delivery rush. This is a good strategy if you decide to be on multiple apps and your delivery volume is high.
On the other hand, you can pick one app and stick to it. This can keep the process manageable as a side task. Many diners have accounts on multiple apps.
If dine-in business is heavy or simply more of a priority to you than delivery, consider turning off third-party orders during the rush. That way delivery can supplement your business when things are slow—like during bad weather—but not serve as a distraction or a source of stress when your house is full.
Tip #5: Change Your Space
Some businesses are making permanent changes to their business model—adapt or perish—based on rising delivery volume. Generally speaking, that involves scaling up your kitchen space and scaling down your seating area. Sometimes it involves less square footage overall. If you’re primed for a remodel or a move, seriously consider whether you need a different size or allocation of space.
There are more extreme versions of this change, and of course, they come with risk. Some restaurants are doing away with dining space altogether for a delivery only business (or delivery and pickup). Others are adding a whole separate kitchen: one for dine-in, one for pickup.
The more extreme the makeover, the more easily you should be able to justify the change with hard data.
Tip #6: Do It Yourself, Instead
The unfortunate truth is that third-party apps have unavoidable, painful downsides:
- They take 10-35% of your order total, and there’s no good way to make up for it. That hurts your already thin margins.
- None of the tips go to your staff. Either they get stiffed as delivery orders rise, or you have to tip them out from your own pocket.
- You have no control over the quality of the delivery driver, and they have no loyalty to your business (but all the power to hurt your reputation). Aside from angry customers, those delays could cause a food safety problem.
- Some restaurants have reported payment processing issues with app companies’ credit cards , which causes delays you can’t avoid and directs customers blame on you.
- Their interface puts you in competition with other restaurants for a user’s business.
- Despite cutting into your margins, third-party delivery services have yet to turn a profit for themselves. They haven’t proven they’re sustainable.
But customers want delivery, and they want the convenience of ordering online. What can you do?
Well, if you’re lucky, you can use a POS system that supports online ordering, and go back to handling deliveries yourself.
It’s a better bet if you already have a loyal customer base, amazing press, or word of mouth. If you’re an unknown quantity, you’ll be out of sight, out of mind. But if your customers will be craving your food, it’s just a matter of spreading the word that they can order from you directly.
The questions of profitability and logistics will still stand and be important. But this way the order total, delivery fee, and tips will be coming home to you, not Silicon Valley. You’ll want to consider your software carefully, and make sure your ordering forms are mobile-friendly. If you don’t want to switch your POS, there’s at least one provider that supports online order separately, and it works on a flat monthly fee.
The Bottom Line
The fact is that online ordering is here to stay—customers don’t want to dictate orders and credit cards over the phone anymore, and 63% of restaurant traffic is now off-premises. You can certainly opt out, but you risk being left behind as the industry barrels ahead. The trick is to take control of how delivery fits into your business, then take steps to ensure that customers will be as satisfied with your food at home as they are when it’s served in your dining room.