There has been a lot of talk recently about whether delivery is a sustainable trend for quick-serve restaurants. The costs are high and the logistics are challenging but there is certainly a demand for it and restaurants are responding. Many high-profile chains are jumping on board the delivery train and the way new locations are being built is taking into account this new wave.
According to research, customers are willing to pay more for the convenience of not having to prepare or pickup their own meals. Which is why Panera is planning to hire more employees to offer delivery service. They estimate that this change will increase each store’s annual revenue by $250,000.
UberEATS, Postmates, and Doordash are just a few of the major companies leading the charge for third-party delivery. The problem with this system, is that third party delivery companies charge restaurants a commission that can be quite signficant 10-30%. For an industry built on thin margins, the challenge is to ensure that delivery increases your bottom line in addition to your top line.
A second challenge with third party delivery is that your restaurant becomes one step removed from your customer. Most of the challenge of using a third-party delivery services relates to negating your existing sales as well as issues with management and store operations. When a customer orders through a third party, the customer effectively only communicates with the delivery company, not with your restaurant.
Another option is use third-party logistics services, such as UberRUSH and Postmates On-Demand. With these services, as with Uber, the company is only used for transportation and not for ordering. This allows you more control over the order, as well as lower fees. In addition, these services offer time quotes for how long the food takes to reach the customer once they have ordered.
For most QSR’s, third-party logistics services offer the best solution for meeting customer demands for delivery. The customer still communicates directly with your restaurant and the customer directly pays the delivery service, so their delivery doesn’t cut into your profit on the order.
While Panera is changing infrastructure, including kitchen setups, to accommodate delivery, other QSRs may find that they need make smaller changes. This includes creating a POS system, like a chatbot so that your customers have a convenient and easy way to order and you have control over the sale.
Delivery is clearly the future, as studies continually show that companies meet customer demands retain their customers and grow. The challenge is how to meet customer demand for delivery, without giving up your profits and easily integrating third-party logistics services into your current dynamic.