Why is food delivery considered a Gold Mine?
Due to large digitalization, the demand for online food delivery is growing rapidly at a very considerable rate. A large chunk of people are getting comfortable with ordering food and groceries online. As per the reports, by 2025, the food delivery business is expected to reach a valuation of about $14 billion.
Demand for restaurant delivery has skyrocketed during the pandemic. Many food service establishments in Canada and the United States remain closed because of COVID-19. Even though our lives have changed and people are at home, the desire and demand for bars and restaurants have shot up.
Before 2020, delivery service was looking like the way of the future especially when it comes to the restaurant business and then this COVID happened. Food delivery service was already anticipated to explode in the 2020s, and market research forecasts the global market growth of over $45 billion by 2023.
So even if your business made it through during lockdown without using the food delivery service, now it is time to take the delivery train. If you have not explored this side of the delivery business, it might look like a hassle for you. But setting up a delivery for your restaurant will work wonders for your business.
For many bars and restaurants, fulfilling the in-house deliveries is a great option over outsourcing it to a third party. Whether you want to ramp it up or launch your restaurant delivery service, the points mentioned below will help you how to set up a delivery service for your restaurant:
There are many ways for restaurant delivery. Examine all your delivery options before choosing the system that best suits your business.
- In-house restaurant delivery
In-house restaurant delivery mainly refers to fulfilling delivery orders with your in-house drivers. While this delivery setup takes time and also resources to set up properly. But it ultimately lets you retain more profits and have proper control over the delivery setup.
- Third-party delivery services
This particular option involves outsourcing your restaurant delivery to third-person services like ChowNow, DoorDash, and other delivery partners. This is the most convenient and popular choice for restaurant owners to outsource the food delivery work. It also helps your restaurant to expose and get in touch with the new audience. All these services mainly take up to 25 to 30% of the commission and your business cannot control the delivery experience as well.
- Hybrid restaurant delivery mock-up
Many restaurants fulfill the deliveries by splitting the orders between third-party delivery drivers and their fleet. This option enables you to complete more orders while maintaining a portion of the profit. A hybrid model can also involve using third-party platforms to take orders which they then deliver with their own fleet.
After picking your best option, continue with the below steps.
- Improve your POS system
The POS system can also be one of the most powerful tools in your arsenal especially when it comes to expanding your business. There is a great system in the market, but you need to make sure that yours is a customized system according to your business needs and requirements. This will help you in forming a delivery service for your restaurant.
If you want to know how to open a restaurant delivery service, you need a POS integration for restaurants that can handle the delivery. There are plenty of options your business can take when starting a delivery and your POS system will help you in handling things like:
- Delivery options
- Customer information
- Operational control
- Online ordering
- Keep a check on your kitchen line
This is an often unnoticed step in setting up your delivery business. Not all kitchen line staff is designed to be like this or capable of the rigors of delivery service. You need to make sure that you do it before you start. Smaller restaurants can expect to see much higher than the normal volume at a specific time of the day and also the year.
While more and more late-night orders and also large orders on events are great, it may mean making a pinch to your typical kitchen line. The employees on the line taking orders should have the proper food service training to keep up the workflow restructured, fruitful and efficient at the drop of a hat.
- Pick from delivery service option
There are numerous ways to set up a delivery for the restaurant. If you are interested in outsourcing your delivery through various outsourcing partners, there are very few options available. However, both signing up with the third party and in-house delivery have their pros and cons to be considered.
Going with the existing delivery service allows you to access two vital resources: drivers and the market. However, studies have shown that collaboration with third-party resources comes at a potentially precipitous cost. All these services take a high cut of the extra sales that your business is getting and they keep control of your pricing and menu.
Also on top of that, you lose access to valuable customer data. So if you are investing, looking into hiring drivers for restaurant delivery and also upgrading your POS system might be the way to go. The upfront cost will be higher and so will the ROI.
- Decide about transportation
When it comes to hiring employees for delivery, there are a couple of different paths to choose from. Businesses have the choice of hiring someone that can be a part-time delivery person or a full-time person who does nothing else but delivery. These employments closely resemble using an agreement worker.
Having your vehicle is very cheap and convenient, however, there is some serious downside of it. You can’t force the employee to maintain the vehicle properly or have a car with enough space for your products. And you also lose out on a chance to have a branded company car as an additional commercial.
- Package food in branded packaging
Unlike a traditional setting, delivering food also requires a business to find proper solutions to get their dishes to a customer living far away in a quicker manner along with maintaining the quality. This means investing in temperature controlled, sturdy, and possibly branded materials to keep the food delicious and intact.
- Design a takeaway menu
Not all restaurants have a menu that is suitable for delivery or takeaway. But some classic types of food can be delivered commonly. There is always a creative solution for getting your bowl of soup or rack of lamb to a customer at home.
If you are not ready to invest in high-end packaging for your food delivery, consider taking out some selected takeaway menus from your already obtainable options. This would prevent the difficult items that are hard to carry from slowing down the kitchen flow and making things easier for the consumers.
You can always start making your delivery options friendly. Your takeaway menu can also help you in maximizing your revenue and keeping it different from the usual restaurant menu will give you maximum benefits.
- Don’t forget the tips
One of the most important parts to consider before starting the delivery is the tipping policy. It’s a custom in many places to be ready to give a tip to your driver, but with the boost in the digital world, many customers prefer paying by card and make things complicated by having to add a tip to an already run check.
Also, having an employee leave for upward of an hour at a time while on the clock will start to add up in labor costs. To evade this, many restaurants have a required minimum order amount before delivery option. Some restaurants also comprise a delivery service fee.
With every changing market, it is very hard to decide on the best direction for your business. But just like your drivers, it is up to the business owner to decide the best possible route their business should opt for.
Advantages of An In-House Restaurant Delivery Service
Here is a closer look at how to set up a delivery service for your restaurant and what advantages it brings to your business.
Keep control over customer experience
If you opt to go for a third-party delivery service, there is no guarantee that the packed food will be delivered properly and you cannot add your personalized service to it. These drivers work on behalf of many restaurants and are incentivized to focus on speed instead of service. When you hire your in-house driver or complete the deliveries by yourself, you can take your team to higher standards.
Preserve more profit
Third-party services can take up to 45% of the commission for fulfilling all the deliveries. If your restaurants complete $4500 worth of third-party delivery orders per month, you are left with just $2500 in revenue after the service fee. Over a year, that’s a loss of $30,000! In an industry where profit margins remain thin, such commission fees can cause a business to cease operations. Starting your delivery means you get to keep all of the profits from these orders.
Build relationships with the consumers
The hospitality industry is centered on people. Fulfilling deliveries will allow restaurants to connect with more customers. During the pandemic, social distant interactions between delivery and customers were a way to build a relationship that wouldn’t be possible otherwise.
Knowing your consumers and building relationships will bring you loyalty. A 10% increase in customer loyalty leads to a 100% increase in sales. In-house deliveries are a valuable investment in your business.
How to set up an in-house restaurant delivery service?
Starting a delivery service can take a lot of work upfront, but it is worth it. Here is how to do it in five steps:
- Get online ordering equipment
Equip your restaurant with the latest technology with an online restaurant ordering tool. While many third-party services will let you fulfill all your deliveries, they also don’t necessarily incorporate the POS. Use a free restaurant online ordering software that helps in processing the payments and integrates with the POS to speed up the streamlined deliveries.
- Staff up
Next, you also need to evaluate your staffing needs. Do you have enough manpower for packing, cooking, and also bringing them to the consumers? Do you need to hire more staff for delivery like drivers, or your existing staff can fulfill all the jobs?
If you are taking assistance from the existing team, make sure that they can handle all the workload. If you want to hire drivers, ask other restaurants for recommendations. You can even create a driver co-op by getting in partnership with other restaurants. Make sure your drivers have a driving license, a good driving record, and experience in customer service. If they have their bonus, it can be a bonus for you.
- Your restaurant should be well equipped with vehicles
You must decide if you will use a company vehicle for deliveries, or if the drivers will need to supply through their vehicles. Buying a vehicle from a company gives you more control over it. While this option is costly you may be able to write off the payments as business expenditures. If drivers are using their vehicles, plan compensation for them for upkeep and gas and equip them with viable vehicle insurance.
You can opt from several other options when it comes to delivery vehicles-
- Cars are the most expensive option, but they are the most ideal choice for deliveries, especially in colder climate conditions. It can hold a lot of food and is comfortable for drivers in any weather condition and also lets you have a wider delivery radius.
- Motorbikes and motorscooters are also appropriate middle options between cars and bikes. They are the most affordable as compared to cars and can also weave through traffic easily as compared to a car. However, they can also carry more food than cars and are also temperature controlled.
- Bikes are the most popular choice for food delivery in cities with narrow streets and traffic areas. But they are not favorable in harsh climates as it is difficult for the drivers to carry the food in bad weather conditions. Bikes are the most affordable and easy to maintain though they can’t transport food as much as cars and mopeds and will also limit your delivery radius.
Ultimately, the best delivery vehicle for your restaurant entirely depends on your unique type of food needs and location.
- Give training to your delivery drivers
Giving training to your logistics and customer service department is very important. You must create a delivery process and teach your drivers to follow it properly. Develop a system for optimizing and creating routes, and communicating the new deliveries and pick-up points. Don’t forget to train the drivers with safety protocols like contactless delivery and payment options.
You are adding a personalized service to your restaurant different from those who use third-party delivery drivers. So make your customer service training a part of it. Provide the same training to your delivery drivers similar to what your front in-house staff would get. After all, these drivers are a part of your FOH team.
Provide drivers with tips and tricks like how to courteously communicate with customers in case of delays, where to drop the food bags, and how to engage them with customers. All these minute details in training will add a spark to your restaurant business.
- Stock up your equipment required in the delivery process
Get the right delivery equipment to make sure that the quality doesn’t drop off. Takeout containers, insulated bags, and plastic ware are the bare minimum thing required in the delivery process. Always consider inserting note cards in every delivery bag that includes a thank you note, promotions, reheating instructions, and also information about hygiene.
Setting Up A Restaurant for Delivery Service: The Checklist
We have summarized almost everything that is required to start up your restaurant delivery service in this checklist.
- Get the correct technology: make sure it should be integrated with your POS, link it with your restaurant’s website, and adopt online ordering platforms.
- Keep up with the staff: hire delivery drivers, assign your current staff with delivery roles, check staff availability, and make sure your staff is well equipped with smartphones with maps, GPS, flawless driving record, and driver’s license.
- Equip your restaurant with vehicles: make sure staff have their vehicles, and if you purchase a vehicle, it should be a commercial vehicle with an insurance policy.
- Train staff: customer service training, logistics training
- Purchase delivery equipment: take-out containers, insulated delivery bags, and takeout bags; create inserts with menus and promotions.
Promote Your Delivery
Now it is the time to have your database and utilize the free promotions that are being offered by delivery platforms:
* Promote all the changes made on social media, so that the customers can see that you are still open for business and deliveries like home delivery and takeaways.
* Utilize all the larger delivery platforms and restaurant booking platforms that offer access to the entire database
* Your restaurant customer loyalty program through your POS, booking inquiries, website functions, and guest WiFi which take in all the customer details
* Make videos to promote the delivery business and also showcase your restaurant’s menu, dishes, and staff skills
* Upload a cooking demo by a chef or do something that also creates brand knowledge for the consumers
* Also encourage the followers on social media and let them post about your restaurant, promote coupons, discounts, and offers on home delivery service.
* Join local social media and industry pages to keep a check on the latest trends and also about your competitors.
Ensure A Safe Environment for Diners
After ensuring that you have strict safety rules and regulations in place for pick-up and delivery, reassure your customers by communicating these food prep safety and hygiene protocols externally. Some of the good safety practices are:
- Maintaining social distancing while preparing the food
- Wearing protective masks, gloves, and safety equipment
- Washing hands regularly
Get All Operations in Position
Make sure that all the operations are reviewed and checked:
- Reliable internet
- Are you logged in with a delivery partner POS or tablet?
- Are you equipped with sufficient delivery bags and food containers?
- Do you also have a designated pick-up area for delivery collections?
- Have you planned for the extra staff and stock for weekends?
- Have you also set up contactless payments?
- Have you also adjusted your containers or ingredients to ensure express and appeal readiness?
- Do you also have a dedicated order space in your place?
Upload your menu
Always upload your menu on relevant platforms like various food delivery platforms, Google, and your website. The following categories can define your dish:
Menu categories
Set up your menu categories like vegan, sandwiches, burgers, desserts, and pasta.
Images of the Dishes
You can put up your best sellers or the images provided by your delivery partners
Deals on meals
Devise meals around top sellers at an improved value than the items separately
Extras
Always add extra to upsell like drinks, sauces, desserts, and tissues
Be visible on Google
Set up your business on Google by setting up your Google My Business account. Promote your business effectively on Google. If you are planning a delivery without a platform, create your links and also add them to your Google listing
Tip
Google has also added takeout filters and delivery on Google Maps to boost your presence.
Successfully Launching an In-House Restaurant Delivery Service
Keeping up with your restaurant’s delivery orders in-house can be a viable choice for many restaurant businesses. This can be a delivery model which offers great control over the customer experience, and revenue and also allows you to connect with the customers. While starting a restaurant delivery service can take a lot of work upfront, it is well worth the investment.