The coronavirus pandemic has drastically changed how we live and work in the United States. Across the country, states issued stay-at-home orders that led to the closure of non-essential businesses. While restaurants remained open, dine-in services were generally prohibited — which left pick-up and delivery as the only options for most businesses. Even after re-opening dine-in options, many consumers still prefer to order delivery instead of dining in.
During this time, many restaurants have turned to online services to help them process and manage food orders. Even before the spread of COVID-19 required restaurants to adapt their business models, there were significant advantages to using an online platform for processing orders. Online ordering allows for greater accuracy, can boost a restaurant’s popularity, and even increase sales. Mobile ordering was anticipated to be a $38 billion industry in 2020, and will likely account for an even bigger share of industry profits due to coronavirus-related closures.
For many restaurant owners, the question isn’t whether to offer online ordering — but which food delivery service is the best choice. Businesses typically spend a substantial amount of time making decisions like this, but the pandemic has pushed restaurants to quickly set up a way for their customers to order online. Below, we’ll outline how to partner with a deliver service and the factors to think about when selecting a service, as well as the best restaurant delivery services that you may want to partner with during this crisis and beyond.
Benefits of Partnering with a Third-Party Food Delivery Service
There are many benefits to partnering with a food delivery service provider. First and foremost, delivery services provide you with an opportunity to bring in new sales from customers who don’t like dining out or increase sales from existing customers who may not want to travel for food on particular days. Your menu will also be featured on the delivery service’s app, which gives your brand more exposure.
Working with a third-party delivery service holds benefits over hiring delivery employees as well. Adding employees means having to do more payroll work and potentially wasting money if demand for deliveries is down on certain nights. Working with a third-party service allows you to avoid the hassle of managing additional employees.
What to Consider When Choosing a Food Delivery Service Partner
Most restaurants do not have their own mobile ordering app or the budget to set up online ordering independently. Third-party services, such as DoorDash or UberEats, are often the best alternative. These companies provide a platform that your customers can use to order food — and their workers will pick up and deliver food for you.
Before you choose a third-party delivery service, you will want to make sure that what the other company offers helps your own business. At the end of the day, you want your customers to be satisfied, the orders to be processed smoothly, and to maintain profitability.
With that in mind, be sure to consider the following factors when selecting a food delivery service partner:
- What percentage does the delivery service charge? Commissions may be anywhere from 15 to 30% of each order. Do the math to determine if these and other costs will increase or decrease the order value per check.
- What is the company’s reputation for reliability and customer service? Ask for information on average delivery times, how the company handles complaints, and if its drivers are vetted before being hired. After all, you don’t want customers to have a negative opinion of your restaurant because of something that the delivery company did.
- What type of contract will you need to sign? When making a decision in a hurry to meet needs during a pandemic, you probably don’t want a long-term commitment. Carefully examine the terms of any contract, and be sure to follow up on the company’s performance.
- How many drivers does a company have in your area? In urban settings, there may be dozens of delivery companies that each have hundreds of workers. In rural and suburban locales, your options may be more limited — and there will likely be fewer drivers available.
In addition, think about whether your restaurant is well-suited for delivery orders. Do you have the technology to ensure that your cooks can get online orders easily and prepare them in a timely fashion? Is your food easily prepared and assembled for take-out? Do you have what you need (such as branded take-out bags) to package food for delivery?
If you decide to use a third-party delivery service after considering all of these factors, read on for our top choices for restaurant delivery partners.
This delivery service is a market leader across the United States. While DoorDash does not disclose its fee schedule, its order commission is estimated to be 20%, which is one of the lowest rates in the industry. Restaurants may be able to pay a higher fee to have their business appear higher in searches through the app or website.
DoorDash has an advantage of having drivers throughout the country. Its app reaches 80% of American consumers. According to its statistics, 91% of its deliveries are on-time or early. The average delivery time is 37 minutes from when an order is placed.
Unlike other services, DoorDash’s workers — known as “Dashers” — only pick up and deliver food from restaurants. This may make it a better fit for your business than services whose drivers also pick up passengers or groceries.
Signing up for DoorDash is relatively simple. Owners can register through the website by submitting information about your restaurant, menu, order protocol preference and pictures of your food. DoorDash estimates that the entire process will take 10 to 15 minutes, and that deliveries will start within a week.
Most of us are familiar with what Uber does: the corporation hires independent contractors to use their own vehicles as a taxi service. The ride-share company also allows customers to order food from restaurants, which their drivers will pick up and deliver. Restaurants can partner with UberEats to add their business to this service.
UberEats charges restaurants an estimated 30 to 40% commission on each order. This can significantly impact your bottom line. Unlike services like DoorDash, UberEats drivers are not specifically trained to handle food or orders, which may lead to an increase in customer unhappiness.
However, UberEats is available throughout the United States, wherever its drivers are located, which makes it a convenient option for many businesses. You can sign up for the service through its website, and in some cases, begin getting orders within a few days.
Another popular choice, GrubHub has 14.5 million users across 1,700 cities. It is particularly popular in larger cities such as Los Angeles, Boston, Philadelphia, New York, and Chicago.
GrubHub is different from other delivery services in that it allows restaurants to use their own delivery staff. This means that you can maintain control over how your food is delivered, while benefiting from the convenience of the app’s ordering system. The company also offers point of sale (POS) integration, which makes it easier for many restaurants to receive orders.
Depending on the level of service that you use, the commission percentage for GrubHub ranges from 15 to 30%. If these custom options appeal to you, signing up is relatively simple through GrubHub’s website.
Compared to DoorDash and GrubHub, Postmates still has a relatively high share of the total market for third-party delivery services. It is the top third party-delivery service for customer spending and retention, with customers averaging 3 transactions per month (the highest in the industry). This may be due to the fact that Postmates is more than a restaurant delivery service — its drivers will also run errands for customers, like picking up alcohol or groceries.
For restaurants, Postmates charges a commission of 30% per order. It is most popular in larger cities such as Los Angeles. It is available in more than 4,200 cities worldwide. Postmates allows restaurants to decide how they want to receive orders, including through their POS system.
While Postmates is more commonly used in bigger cities, its users tend to be dedicated to the app. As with the other sites, signing up for Postmates is a straightforward process that is done through its website.
Factor Food Delivery Into Your Restaurant’s P&L
It’s important to remember that the overarching goal in partnering with a delivery service is to achieve financial stability and grow your business. To ensure this is happening, you’ll want to track the impact the service has on your restaurant’s profit and loss statement. Are sales rising due to the availability of delivery options? How much are delivery costs eating into your profits? Keeping an eye on these metrics can help you determine if your delivery partnership is working.
How Custom Disposables Can Build Your Brand
For most restaurants in the United States, pick up and delivery is currently the only option. Whether you are taking orders by phone or through an online food delivery service, having custom cups, bowls, bags and more can help grow your business. Your customers will enjoy your food — and remember your name for future purchases.
Budget Branders is dedicated to helping small businesses get the branded disposables that they need for less. In the past, customized cups and other disposables were a luxury that only big restaurant chains could afford. Our custom-printed disposables are available in prices and quantities that make sense for independently owned restaurants. To learn more about how we can help you promote your restaurant’s brand, contact us today by filling out a form or pressing the live chat button. Alternatively, you can submit a quote request for one or more of our products.