18 Jun The Top Challenges in Third-Party Food Delivery & Apps
Online ordering is the newest hot topic in the restaurant industry, and 6.6% of all restaurant orders now begin with an online experience, says PYMNTS.com. Consumers want flexibility, and added flexibility may present significant challenges for restaurant operators, their IT departments, and ability to handle added orders, reports Dee-Ann Durbin of AP News. While companies continue to embrace the idea of third-party delivery, others view the service as an unnecessary risk. For companies with established business models, outsourcing delivery would disrupt basic customer expectations. In fact, some executives have voiced concern over outsourcing, promising to never embark on that journey. Before deciding whether to use third-party food delivery apps, including Uber Eats, restaurant managers should consider the challenges that exist and how to overcome them.
Inability to Integrate Systems With Third-Party Food Delivery Service Providers
Restaurants enjoyed a busy lunch period for decades, and dinner service might have increased depending on the location and consumer expectations. With that in mind, companies focused on offering service and experience. Now customers expect delivery from any restaurant, but hiring in-house delivery drivers adds to costs. With changing peak ordering times, more companies must turn to third-party delivery service providers, presenting another challenge—failure to integrate these third-party delivery apps will lead to lost customers. A simple online ordering platform through your site is not enough; you must integrate your business with third-party apps, among other food delivery channels including off-premise and on-premise ordering, to survive.
Increasing Food and Labor Costs
Higher food and labor costs form another challenge in offering third-party delivery and digital food ordering experiences. Since your business reaps the benefits of more customers, it will naturally incur higher labor and food costs, which includes hiring more staff to work during peak volume hours, training of staff, purchasing more food and storing it. Furthermore, your restaurant may need to add new grills, fryers, and other equipment to handle the challenge. The end goal is simple; prepare more food faster and deliver with zero errors. Each action also contributes to more congestion in the restaurant, especially in consumer areas.
Increasing Regulations Impacting Food Handling and Delivery
Increasing regulations make up another challenge in offering third-party delivery. The food industry is evolving, and legislation is in the process of developing new rules for companies that provide third-party delivery and food handling. Keeping up with these regulations means trusting delivery services also maintain compliance. Thus, the more popular apps, including UberEats, DoorDash, and GrubHub, will rise to become more popular, and your business must work with them all while integrating those orders and ensuing data into your Point-of-Sale (POS) system to not miss a single order from third-party delivery apps.
More Competition From Delivery-Partnering Companies
With more companies working with third-party delivery services, competition increases further. It is not enough to simply offer delivery; the experience must be stellar. Failures in the integration of these apps into your POS and use of online ordering platforms will contribute to poor experiences, and since customers are not in your restaurant, the opportunity to correct the issue immediately does not exist.
Inability to Manage Delivery Services
As noted by Kevin Hardy of QSR magazine, controlling the delivery experience is essential to keeping costs under control. Third-party food delivery services charge 20-30%, depending on the distance. In a low profit-margin industry, managing delivery amounts to maintaining profitability. Yet, customers still expect it. The only solution is to reduce costs where possible and maintain transparency with costs for delivery through apps. Labor costs are typically what increases the most when operators employ multiple channels for food ordering. Operators reduce the need for bolstered staff numbers during peak ordering hours when the third party delivery app is integrated into a POS as there is no need to rekey orders manually and through a reconfiguration of store footprint to handle third party deliveries more efficiently, staff levels are more easily optimized.
Partner With the Right Expert in Digital Ordering and Third-Party Delivery App Integration
Avoiding the digital delivery future might be possible for some restaurants. Customer expectations for delivery from any restaurant continue to increase, and the success of your brand will depend on your ability to offer delivery. Unless you have the processes in place to handle delivery to a large service area, you must begin the process of working with third-party food delivery services now. Choose a partner that knows how to put the power of online ordering and third-party integration into your POS to work for you. Request a Tacit demo online, or give us a call at 1-866-962-3426 to get started.