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Written by David Hopkins and Jenny Companion of The Fifteen Group

[/vc_column_text][vc_custom_heading text=”As our world becomes increasingly automated, digital, and mechanized, third-party delivery services continue to grow in popularity.

” font_container=”tag:h2|font_size:20|text_align:left|color:%231670bf”][/vc_column][/vc_row][vc_row][vc_column width=”1/2″][vc_single_image image=”14148″ img_size=”full”][/vc_column][vc_column width=”1/2″][vc_column_text]With so many different platforms to potentially collaborate with, it can be difficult for restaurants to determine which will provide the highest return-on-investment for their business and customers. 

Our team of experts, at The Fifteen Group, always recommends that a restaurant conduct a cost-benefit analysis for any potential third-party delivery service partnership. There is no standard template for creating a brand relationship, in the food delivery sphere, as every business is different. However, restaurateurs need to think through all aspects of a potential collaboration and what it will mean for their unique value proposition, in the minds of consumers. [/vc_column_text][vc_column_text]Following their rapid, wide-spread acceptance and use, we advise our clients to consider the following when it comes to third-party delivery apps:[/vc_column_text][/vc_column][/vc_row][vc_row][vc_column][vc_custom_heading text=”1. Reputation” font_container=”tag:h2|font_size:20|text_align:left|color:%231670bf”][vc_column_text]During the auditing process of all available mobile applications, restaurants should conduct some self-guided research regarding each candidate’s reputation in the market. This audit may not necessarily reflect the absolute value of the app; however, in an age when everything is shared on social media and online review platforms, a brand’s public positioning and reception have a powerful sway on consumers. Do some research on the public opinion of the app and speak to users of their services, along with other peers in the foodservice and hospitality industry that may have experience with each app.[/vc_column_text][vc_custom_heading text=”2. Delivery Method” font_container=”tag:h2|font_size:20|text_align:left|color:%231670bf”][vc_column_text]The means of delivery, the physical transportation of food and beverage offerings, are also significant. Some apps use car delivery (Uber Eats), while others exclusively rely on bike couriers (Foodora). There are pros and cons to both models, and many restaurants utilize both. Important factors to consider include: which platforms are other restaurants in your area using? Is your location more conducive to driving (with accessible parking) or is it better suited to biking? Are your menu items robust enough to survive backpack transport, or would they fare better in a car?[/vc_column_text][vc_single_image image=”14146″ img_size=”full”][vc_custom_heading text=”3. Evaluate Your Take-out Menu” font_container=”tag:h2|font_size:20|text_align:left|color:%231670bf”][vc_column_text]

Not everything you serve in your restaurant’s brick and mortar space will translate well to delivery. A restaurateur needs to consider customer expectations during this assessment phase. Customers are used to a certain quality, and presentation of food in your restaurant and will expect the same for take-out. Do not include items on an app delivery menu that are impressive in your restaurant but will disappoint post-transit. For example, a charcuterie board; it wows on a wooden board with a beautifully-styled selection of cheese and artisanal bread, but falls short when packed in a container and taken across town.

[/vc_column_text][vc_custom_heading text=”4. Profit” font_container=”tag:h2|font_size:20|text_align:left|color:%231670bf”][vc_column_text]Restaurants also need to analyze the profit margins of their menu items and determine whether they are worth delivering, from a profitability point-of-view. Virtually all delivery apps charge a service fee, calculated as a percentage of your sales on their platform. Remove menu items with lower profit margins from delivery – with the service fee factored in, those dishes will not generate sufficient profit, regardless of forecasted volume. [/vc_column_text][vc_custom_heading text=”5. Marketing Investment” font_container=”tag:h2|font_size:20|text_align:left|color:%231670bf”][vc_column_text]While delivery fees are costly, they do present substantial benefits to your restaurant. App fees range between 15% and 30% of sales; however, regardless of cost, a savvy restaurateur will understand that this investment also serves as a marketing tool. Being featured on a delivery app will allow your restaurant brand to tap into a new customer market. In short, delivery apps render restaurants more accessible. With a mutually beneficial relationship, restaurateurs will reach and influence a broader swath of people, and consumers have a greater selection of dining choices. [/vc_column_text][vc_column_text]

There’s no clear-cut answer when determining which third-party, digital delivery service partner to work with. As with all things in the hospitality industry, it’s essential to analyze the pros and cons in a culinary-cost-benefit-analysis. While the decision-making process may not always be straightforward, two things are apparent: convenience is king, and technology and food are becoming increasingly intertwined. If your restaurant doesn’t take steps to adapt to these changes, it may be rendered obsolete.

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