Just wondering how much of an effect third party delivery services have had to your overall sales and most importantly the bottom line?
I don’t use any of these services but my sales have skyrocketed since third party deliver became widespread in town. I guess they get more people used to getting delivery to home so the pie that we’re all fighting for a piece of has gotten bigger and bigger.
Good to know! They’re all starting to trickle into my area right now. Uber eats a couple months ago and Grubhub just sent me an email couple days ago.
I am in Richmond VA. Grubhub, eatstreet, are about %15 of my sales. They get the order and I deliver it in my 2.5 mile radius area. I am doing $4500 a week total, so they are bringing in about $500, and my sparrowspizza.com and my telephones are getting $4,000.
I opened 1 year ago. And I have been stuck at $4500 for 4 months. I turned off uberats and doordash 2 months ago. they toke %30. but they got the order and they came and picked it up and delivered it. I had wanted to cancel with them for a while, but was afraid of losing $500 a week in sales. Their drivers show up with curlers in their hair and wearing pajamas and flip flops, no hot bag. One even gave me a one star on google, not sure why. One night I got a $20 order on uberats and the driver said “oh cool, its just across the street” (uber does not let me know the destination). My intention was people would use Ubereats and door dash that were out of my delivery area. So I turned off those 2 tablets immediately. I’m not sending $6 to San Francisco for an across the street delivery when I have a professional driver sitting right there. And the next week sales stayed the same after dropping them. One thing I noticed I was using a lot less cheese after I dropped those two. I am pretty sure I was losing money with them.
I am going to turn off Grubhub and eatstreet one day soon. Just afraid to pull the trigger. I just hope when I do they all just switch to sparrows pizza.com. It will also be less confusion and mistakes in the store. All in store orders come through the thremal printer but the Grubhub we have to confirm on their tablet then go to the internet and print out on full size piece of paper, so were all reading different tickets.
Their average order is $20. and they take 15%, in other words $3 per order. so at $500 in sales thats $75 a week. Thats $4000 a year I could be spending on my own advertising, just like bodegahway said in a earlier post. Or I could raise delivery fee to $3(its only $1 now) I have free delivery on all my in house orders. I think I am the only one in Richmond that has free delivery. I think of it more as an advertising cost then operational.
They might be a good way to start, get the word out about your business, free advertising, but if your a delco the end game is just get the orders yourself. And if you have a decent sit down pizza place you don’t want these 3rd party drivers coming in with “JUICY” stamped on their butt.
My opinion is if you’re going to use a 3rd party delivery service, you have to go all in with them, otherwise don’t use them at all. If you cut out your driver payroll and all the workers comp, payroll taxes, and insurance associated with delivering, and replace that with the percentage you pay these companies, you can surely come out ahead. If you have both 3rd party and in house delivery, you’re essentially paying double what you have to.
This would scare the crap out of me as someone with a long time business built around delivery. If I went all in with Uber Eats who has been in town for about a year, what happens when they decide to leave? There’s certainly not a long enough track record with any 3rd party delivery companies in my town to make me stake the future of my business on them. Legislation is constantly being pushed and debated to make it harder for Uber to do what they do. It wouldn’t surprise me at all if something happens to make them close up shop in any particular neighborhood. I can see considering this if you’re a sit down restaurant looking to add delivery but if delivery is your business, I’m not sure putting it 100% in someone else’s hands makes sense.
I’m with you 100% which is why I don’t think these 3rd party delivery companies are a good fit for us delcos that get the majority of our business from delivery.
We use the “busiest” 3rd-party service in our market to accept orders but we still take the deliveries ourselves and pass the extra cost back to their customers. It really seems people are fans of the ordering method (one-stop shopping) and not any particular restaurants.
These companies are nothing but vampires. The rationale for a sit-down to go with them is that they produce incremental sales. If they were taking 5% for order referrals that would be one thing, but 20-30% is just sucking the blood right out of you.
If you are a delco and already set up to deliver just up your marketing, focus on quality and service and move on.
I guess the silver lining is that they condition the customer to accept the cost of delivery.
When I hear 30%… I immediately go into “%$#@ you” mode. I mean… I don’t want to see charts or graphs or hear about incremental this is or add-on that… they can &%$# off. Period.
Yes… I do feel better now
I’ve been chasing these guys away for a couple of years now. I find the whole business model a dud when you look at it closely. For any business to work you have to have each party benefit from the transaction. The Customers, the employee and the business. With this model you add in the private contractor ( the driver ) which increases the likely hood that someone will get the short end of the stick.
I explain to the delivery service sales people that if I use their service, my people will make less money and my customers will pay more. Its the worst possible combination. This concept goes over their head.
On a positive note the these delivery services have increased the delivery market as bodegahwy stated, and lowered the non owned delivery insurance cost so thumbs up for that.
When I had my Domino’s store a local guy who was starting up his own food delivery service came in pitching his services.
I understood what he was doing- and good for him for trying/starting something (this was back in 2004 or so) but I could not get him to understand that I had that down!
I mean… he’s standing in a DP store- drivers, car-tops, heat bags… just odd.
It was a nice conversation but he wasn’t getting it!
We had a local outfit that tried to get started in our town. Another restaurant owner I know started up with them. I had a long talk with him about why they would not make it based on the cost per delivery to break even vs what they were planning to charge. They made it less than a year.
I received an email this morning from a new one, doordash.com I looked at their site and I’m already on it. How does this work? They send people to come to my store to pick up the food?
I noticed they are on the new Wendy’s ads.
Yes Doordash sends drivers to the restaurant to pickup the order then the driver delivers it to the customer. They have been around here for awhile. I routinely see them going into my local Burger King and Chipotle to pickup orders.
Edit: And unlike some of the others, they are wearing a company shirt and some even have heat bags.
I have been with Uber for about 6 months. My commission is 35%. Yes, I said 35% . I have a combo only menu which I offer at a higher price to offset the ridiculous commission. I’m only getting about $200 a week but my margins are ok.
I dropped grubhub after 30 days after starting with them after they decided to put up a website and a new phone number for me. And guess what , that new phone number is a tracking number to charge you for every call from grubhub. Grubhub, seamless & eat 24 all operate the same way.
I’m currently with slicelife as well and are about to drop them as well for the same practices.
If your store doesn’t really have an online presence ( online ordering , website), then it’s a good fit for you.
Also , keep in mind , once you sign up with these companies , they take over your “place order” button on Facebook and google.
If you have your own online ordering site , I would stay away.
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Doordash puts you on their website without telling you. Then sells your product at a markup and pockets the cash. Less value for your customers and less money for your drivers to make. I have spent the last 2 years chasing them away. The last salesman told me I would be out of business by now. Not the case. My customers are happier because I don’t over charge them, and my people are happy because they have more cash in their wallet.
Why would you do that? Assuming an industry normal average ticket you are getting what? 10 orders a week? Not even two orders per night.
Don’t you think that you could pick up a couple of orders per day some other way? Especially if you invest the $3500 per year you are spending in this? Why create fog around how to order from you and give up control of your message for $200 per week? (10K per year!).
Can’t wait to see how long McDs keeps doing it.