Why third-party food delivery platforms are hurdle for Restaurant business now?

Why third-party food delivery platforms are hurdle for Restaurant business now?

You already know how popular food aggregator like Ubereat, food panda, Justeat,eat24, Zomato, Swiggy, Grubhub like platforms are gaining popularity nowadays.

There is no second thought that without these platforms your customers never experience the habit of online food ordering & make all possibilities of Sureshot food deliveries to the customers.

Yes, It seems like a boom for the restaurant industry but the truth is something different and today I would like to explain you few facts which show you how these food aggregators destroy the food restaurant business slowly and making their brand from your customers & delicious food items which ultimately provided by your restaurant.

The Problem with third-party Food ordering & delivery service providers, If you are serious about your business you should
think of it.

Issue #1: Managing different obligations of different delivery providers :

We have different type different food delivery companies, Each company has its own way of working for deliveries & intimating orders to restaurants. Some send order notifications on tablets, mobile apps, web backend system, some directly on Thermal printers, Text Messaging, etc. If you are working with different food delivery companies, you can easily understand what I mean here. There is no centralized process to manage all the orders at one place with one way of the delivery process.

Even you don’t know how the food delivery service your order to your customer. Some times a single delivery person delivers multiple orders on his way, this result in a delay in delivery with cold food to your customers. You have no control over it, as a result, your customer puts bad rating on your order and it alarms other customers to away from your restaurant. Whereas the root problem was the delivery process of your Food delivery company, not you or your food.

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To manage the above issue some restaurant needs to adopt a different type of packing so that their customers receive hot foods. The extra cost of packaging which has to be absorbed by you to make your customer happy with you.

Issue #2: High commission by Food delivery companies from your every order:

The main problem is a high commission charged by third party food deliveries company which cut your margin by almost 25%-%30 these days. This may result in running with a slight margin on each order and sometimes difficult to service if you are a small or individual restaurant owner.

It looks charmed that you need not pay anything upfront and only pay on order when someone placed it but if you calculate this fee for a month, quarter or yearly this cost sums up a big number which definitely you can use to expand your business further.

This even more loss, Since customers, start placing online food orders, Dine-in business going down by down these days. The restaurant who invested hugely in their ambiance face low walk-ins for Dine-in food these days.

Great impact of online delivery services by the third-party companies on your restaurant revenues, whereas none of these companies in profits yet and they are running on venture monies, So it’s a dangerous situation no one knows when they lost from the market if they don’t go in profits.

Issue #3: Your restaurant business brand on Risk now: 

When a customer places an order through these food delivery companies, they select items from the application and customer remember the experience of delivery from the food delivery companies not the food from which restaurant. They become a customer of the food delivery company not the customer of your restaurant. And you know that regular customer is far batter for business growth than the new customer each day.

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Even these platforms have no inventory of food or skills to make delicious food but they are popular and growing their brand among customers. What will happen if they lost from the market, it will severely impact your business revenues if your sales are depended on third-party apps.

Your customer never experiences of your services of hospitality they only get your food to taste and don’t know much about your history or staff services.

Sever breach of your customer data, Some times your regular customer / new customer order food from these third-party apps and their data & analytics shared with these food delivery companies but not shared with you. You can’t expand your marketing campaign without these data but yes Food delivery companies can. They earn millions from these data which is simply lost an opportunity for your business.

Issue #4: Your Restaurant business reputation is in hand of Food delivery company: 

How you can control the reputation of your restaurant brand on these food delivery platforms. Any negative offerings in the service of delivery or food will result in bad ratings for your business. Either it was a fault of the delivery guy or some technical glitch of food delivery application. The customer always rates on your business listing which can severely hamper your business in the future.

You have no controls over your business when you work with the third party food aggregators.

Issue #5: Bad habit of discounts/offers – No Real sense of hospitality value: 

Price war or discount war was not there in the Restaurant business when the customer gave value to the hospitality service of the restaurant business. But in the present time, this has vanished from the business scenario. Due to heavily funded food delivery companies offerings of discount & coupon codes, customers are addicted to the discount gemic, what will happen when these discounts will stop?

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First, you have to pay the commission on each order then further discounts as forced by the food delivery companies, Where the margin of business goes after that?? Think about it?

Conclusion – What to do next to cope with the above issues?

Start your digital presence – Website, Food Ordering System, Food Ordering Mobile Apps, Social Media Food Ordering Setups.

It seems it will be a costlier affair but in reality, it is not at all. You can easily get all the above solutions at one time cost of $499 – $1499. No recurring charges, Control over your Restaurant Brand, Your Business, Your customers, Scale your Restaurant business.

You will feel amazed when you see your regular customer really like to order from your restaurant directly, you can offer discounts to them directly instead of paying to third party Food Ordering System. These discount and regular customer engagement build your customer base and it scales your business. Whereas you are leaving this opportunity to promote third-party food delivery companies.

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