Pros and Cons of Restaurant Delivery Services | Fora Financial Blog
Pros and Cons of Offering Restaurant Delivery Services
September 01, 2017

Pros and Cons of Offering Restaurant Delivery Services

As a restaurant owner in the U.S., you are one of over 1 million restaurants nationwide. With this much competition, it is crucial to ensure that you keep up with customer demands to stay afloat. A common expectation diners have these days is the option of restaurant delivery services.

These services are becoming more important for restaurant owners to implement, especially with the widespread use of online food delivery services such as Yelp and Seamless. Although restaurant delivery services can be beneficial for both your customers and your bottom line, there are a few downsides to consider as well. In this article, we highlight both the pros and cons associated with implementing delivery services at your restaurant.

The Pros of Restaurant Delivery Services

First, let’s focus on the positive. An obvious benefit to restauranteurs in offering food delivery is the increased revenue you will likely earn. Your restaurant has a limited number of seats, so offering delivery services during peak times allows you to ensure that you are not turning away any hungry customers.

A second reason to implement restaurant delivery service is to keep up with restaurant industry trends. The way Americans order takeout has dramatically changed from dialing a phone number and placing an order with a live person, to ordering online in just a few clicks on a smart phone. Today, customers can easily access hundreds of restaurants online and place delivery orders for their favorite dishes. Ordering online is quick and convenient for consumers and minimizes the risks of restaurants getting order details wrong through phone call orders. Considering food delivery ideas such as online delivery will ensure you keep your customers satisfied.

If you are worried about the time and resources it will take to set up food delivery for your restaurant, there is a solution. Third-party organizations such as Just Eat and Grubhub specialize in setting up online delivery services for restaurants across the country. There are even organizations that manage the delivery process as well, including Doordash and Cavier.  Although there are fees associated with partnering with these organizations, you will also gain access to the thousands of customers already using these services to order delivery.

The Cons of Restaurant Delivery Services

No matter how you look at it, there are costs associated with implementing a delivery service. These costs could include buying containers to keep food warm, hiring delivery drivers, producing special delivery-only menus and purchasing delivery vehicles. If you don’t have the cash flow available to get your delivery services started, consider applying for a small business loan. By having business financing on-hand, you can make the purchases needed to unveil your delivery services.

Once you launch your delivery service, you will hopefully reap the rewards of increased revenues from the additional orders placed. One fast food establishment in Chicago claims implementing delivery has increased their revenues so much so, that now 25 percent of their overall revenues come from delivery orders. Still, it is important to remember that adding a delivery service could be a big investment. If it isn’t going to be useful to your customers, and won’t make extra sales, then it might not be a worthwhile addition.

Another downside to adding a restaurant delivery service is that it will most likely slow your kitchen down. With the influx in orders, your existing staff will struggle to keep up with creating fresh, quality meals in a timely manner for both in-house patrons and delivery customers. You will not want to disappoint customers with long wait times or worse, receiving mediocre, cold food. You could limit your takeout orders to a shorter menu or consider hiring additional kitchen staff to focus on preparing delivery orders.

As stated earlier, utilizing a third-party platform to manage your online food delivery can be valuable. However, there are downsides to consider with using these services. Outsourcing delivery to a third-party takes away some of your control with the quality of the meal that arrives at your customer’s doorstep. As Gourmet Marketing puts it, “even though the third-party service delivers the food, your customers will tend to hold you responsible for errors, omissions and poor service.”

If you are considering adding delivery to your list of services, there is a lot to consider. All restaurant food delivery ideas have both pros and cons that need to be looked at before you decide if implementing this service is right for your business.

Fora Financial

Editorial Note: Any opinions, analyses, reviews or recommendations expressed in this article are those of the author's alone, and have not been reviewed, approved, or otherwise endorsed by any of these entities.

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Fora Financial is a working capital provider to small business owners nationwide. In addition, the Fora Financial team provides educational information to the small business community through their blog, which covers topics such as business financing, marketing, technology, and much more. If you’d like to see a topic covered on the Fora Financial blog, or want to submit a guest post, please email us at [email protected].
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