Use a Third-Party Food Delivery Service Exclusively or Diversify…What’s the Best Route?

Third-party food delivery service continues to experience strong growth margins among digital dining, well above 33% over the past three years with expectations on surpassing 50% total restaurant orders in the next few years. Yet, restaurateurs continue to hope for the best with in-house platforms and disparately connected tablets for third-party food delivery service providers. Neither option is ideal, but both possess advantages and drawbacks to their use. The only way to make an informed decision lies in considering both sides of the coin. 

What Are the Disadvantages of Third-Party Food Delivery Services?

Cost remains the biggest antithesis of third-party delivery. According to Toast

“The average amount consumers spend with third-party delivery is $34, though it’s worth noting that different third-party delivery platforms attract different types of spenders. For example, those using Caviar or DoorDash tend to spend more than those using Uber Eats or Postmates. [But,] restaurants think they’re generating a lot of business through using a third-party food delivery service, but in three years, they’re going to realize that they gave away 30% of their business paying commission for these services.” 

The situation teeters on the edge of success or failure. A past Tacit client also agrees and notes the risk of lost exclusivity through third-party delivery:

“We are not going to be exclusive. Understand that right up front because your consumers aren’t exclusive.”

Given these notions, we can derive three major disadvantages from working solely with a third-party service. 

  • Higher costs amount to lower profitability. 
  • Limited integration capabilities with existing platforms.
  • Problems controlling delivery conditions. 
  • Inability to see what is actually happening through data. 

What Are the Benefits of Third-Party Services?

Delivery on its own accord does offer benefits to restaurateurs, including:

  • Increased sales without adding more internal staff. 
  • Access to an additional marketing platform.
  • Avoiding the issue of phone space with branded apps. 
  • Existing platforms work with any restaurant. 

Which Is Right for Your Restaurant?

The right path is a bent fork. The fork separates your operations into both in-house and third-party food delivery service, but the fork must return to a focal point. At the mouth of the fork, both operations must come together to avoid unnecessary waste, poor planning, errors, and loss of data. This is the conundrum. Restaurateurs must not focus on exclusively working with a single third-party servicer. They must keep all options open. This is the best way to understand what’s actually happening. Also, they should track the data to see the actual benefits of outsourcing or keeping things in-house. If profitability begins to shrink, consider creating additional delivery promotions, such as free delivery or discounted delivery on a ticket in excess of $X. 

The marketing practice of delivery is still the same. Give customers the perception of free, and they will respond. Of course, this would only be possible through complete integration and ability to see which channels customers prefer and giving them the option to order from a third-party servicer or your restaurant. Whether you choose to outsource delivery entirely or keep some in-house depends on your costs versus profitability. You must keep the balance and rely on what the data reveals. 

Create the Balance of Restaurant Delivery With the Right, Objective Solutions’ Partner

Achieving a balance between your restaurant delivery options means keeping a watchful eye on changes to the costs of each. Cost control requires visibility, and visibility requires the breakdown of barriers between systems. In other words, you need an integrated approach to managing delivery, and Tacit can help achieve that goal with zero downtime and lower upfront costs. Explore the benefits of restaurant delivery by choosing Tacit as your partner in success. Learn more by contacting Tacit online today.

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