As a restaurant owner without an in-house delivery system, selecting the right delivery method is crucial for your business's success. While major platforms like Uber Eats, DoorDash, and Grubhub dominate the market, exploring alternative delivery solutions can offer unique advantages.
Why Major Delivery Platforms Might Not Always Be Ideal
While partnering with large delivery platforms can expand your reach, it's essential to consider the potential drawbacks:
High Commission Fees: These platforms often charge significant commissions, sometimes up to 30%, which can substantially impact your profit margins.
Limited Control Over Customer Experience: Relying on third-party services means less control over delivery times, packaging, and customer interactions, potentially affecting your brand's reputation.
Data Sharing: These platforms may have access to valuable customer data, limiting your ability to build direct relationships with your clientele.
Alternative Delivery Solutions to Consider
1. Direct Online Ordering Systems
- Benefits:
Full Control: By using a direct online ordering system, you maintain control over the entire customer experience, from order placement to delivery.
No Commission Fees: Since you’re not relying on third-party platforms, you avoid hefty commission fees, keeping more profit in your pocket.
Customer Data Ownership: You can collect valuable customer data (like purchase history and preferences), which can be used to personalize offers and marketing strategies, helping you build customer loyalty.
Example: ChowNow
ChowNow is a great tool for restaurants that want to set up their own online ordering system. It integrates directly with your POS and gives you control over the menu and customer experience.
Pro Tip: ChowNow also offers marketing support and customer engagement features, which help restaurants build loyalty and boost repeat business.
Challenges:
Initial Setup Costs: Implementing your own online ordering system may require an upfront investment in technology and website development.
Limited Reach: Without a large third-party platform backing your service, it might take more effort to attract new customers initially.
2. Local Delivery Partnerships
Benefits:
Personalized Service: Local couriers often provide more personal and reliable service than national third-party platforms. They are familiar with your community and can build a better understanding of your brand.
Reduced Fees: Local delivery services often charge lower fees compared to larger platforms, which can result in higher profit margins for your restaurant.
Flexibility: You have the ability to negotiate delivery rates, delivery windows, and operational terms to better suit your needs.
Example: Roadie
Roadie is a gig-based delivery platform that connects local drivers to restaurants. It allows you to pay per delivery or set up an ongoing partnership.
Pro Tip: Roadie offers local deliveries that are more flexible and affordable than large platforms, with drivers who can handle last-minute changes or special requests.
Challenges:
Service Availability: Local delivery services may not be available in every area, especially in more rural or remote locations.
Operational Management: Managing relationships with multiple local couriers may require additional coordination, depending on the scale of your operation.
3. Hybrid Model
Benefits:
Balanced Reach and Control: By combining in-house delivery for local orders and third-party platforms for broader reach, you get the best of both worlds: control over your close-knit community and access to larger customer bases through popular platforms.
Cost Efficiency: You can reduce the dependency on expensive third-party services, saving money while still tapping into their customer base during peak times or in underserved delivery areas.
Flexibility: You can easily adjust delivery methods based on demand. For example, when you're short on delivery staff, third-party services can help fill in the gaps.
Example: Local In-House Delivery + DoorDash
A restaurant can set up their own delivery system for local orders and partner with DoorDash or Uber Eats for customers outside their immediate area or for higher volume periods.
Pro Tip: A hybrid model gives restaurants flexibility, allowing them to manage resources effectively and respond to fluctuations in demand.
Challenges:
Complex Logistics: Balancing multiple delivery systems (in-house and third-party) requires coordination and can complicate your operational workflow.
Tracking Multiple Data Points: Managing and analyzing data from both in-house and third-party delivery channels may require more sophisticated software solutions.
More Alternative Delivery Solutions to Consider (Continued)
4. Delivery Management Platforms
Benefits:
Centralized Management: You can manage orders from multiple third-party services (Uber Eats, Grubhub, etc.) all in one place, reducing the need to toggle between different apps or platforms.
Efficiency: These platforms help optimize delivery routes, ensuring that orders are delivered more quickly, which can improve customer satisfaction and reduce operational costs.
Cost Savings: By selecting the best carrier based on real-time performance and pricing data, you can save on delivery costs.
Example: Onfleet
Onfleet allows restaurants to manage their own fleet or select third-party delivery services. It provides real-time tracking, route optimization, and automated delivery status updates to customers.
Pro Tip: Onfleet integrates with most POS systems, making it a seamless addition to your existing operations.
5. Local Delivery Networks / Gig Platforms
Benefits:
Flexibility: You can choose from a pool of local drivers, adjusting delivery times and routes based on availability and customer needs.
Lower Costs: Gig platforms often charge more affordable rates compared to large, national delivery services.
Personalized Service: Local drivers often provide a more personalized, community-focused experience, which can lead to better customer satisfaction.
Example: Postmates (Local Gig Delivery Service)
Postmates is a gig economy-based platform that allows restaurants to partner with local drivers to deliver orders.
Pro Tip: You can offer delivery to a smaller, more specific geographic area with Postmates, helping you reduce delivery fees and improve service speed.
6. Virtual Delivery Kitchens (Cloud Kitchens)
Benefits:
Cost-Effective: Cloud kitchens eliminate the need for physical storefronts and dining space, which cuts down on rent, utilities, and overhead costs.
Scalable: You can quickly expand your virtual brand without significant upfront investment in additional physical locations.
Optimized for Delivery: Cloud kitchens are designed to fulfill delivery orders quickly, optimizing kitchen layouts and workflows for high-efficiency operations.
Example: Kitchen United
A platform that allows restaurants to rent kitchen space and fulfill online orders through multiple delivery services without the need for a physical storefront.
Pro Tip: Cloud kitchens are ideal for restaurants looking to expand their virtual presence without the cost of opening new locations.
7. Delivery By Subscription Services
Benefits:
Predictable Revenue: Subscription services allow customers to pay upfront for delivery, which can improve cash flow and customer retention.
Loyalty: Subscribers are more likely to order frequently, helping you build a steady base of repeat customers.
Discounted Deliveries: Offer discounts or exclusive deals for members, encouraging more orders and higher overall sales.
Example: Caviar’s Subscription Model
Caviar offers subscription services where customers pay an annual or monthly fee for free delivery and discounts on restaurant orders.
Pro Tip: Consider offering similar subscription models for your brand, especially if you have regular customers who order frequently.
8. Autonomous Delivery Vehicles
Benefits:
Cost Savings: Autonomous delivery vehicles can significantly reduce labor costs by eliminating the need for human drivers.
Speed: Self-driving vehicles can navigate traffic more efficiently than human drivers, leading to faster deliveries.
Sustainability: Many autonomous delivery systems are designed to be electric, reducing your restaurant’s carbon footprint.
Example: Serve Robotics
Serve Robotics is testing autonomous robot delivery systems in urban areas to handle last-mile deliveries.
Pro Tip: While still in development, it’s worth staying informed about the evolution of autonomous delivery, especially in large cities where robots could handle deliveries efficiently.
There’s no one-size-fits-all when it comes to choosing the right delivery solution for your online ordering business. Understanding the pros and cons of each option will help you make an informed decision that aligns with your goals, whether it’s controlling costs, improving customer experience, or expanding your reach.
As delivery continues to evolve, keep an eye on new technologies and trends, and stay flexible in adapting to what’s best for your restaurant.
