In today's digital economy, convenience is king. The shuttering of department stores across the nation has signaled the preference of consumers to shop for and enjoy goods from the comfort of their own homes. The food industry is no exception to this trend. While delivery still makes up a relatively small portion of overall restaurant business, it's a sector that's constantly growing. In the last five years, revenue from deliveries jumped 20 percent and the overall number of deliveries increased by 10 percent. "Delivery has become a need to have and no longer a nice to have in the restaurant industry," says Warren Solochek, senior vice president at NPD group. So how do you go about implementing delivery services at your restaurant? We interviewed two restaurant franchise owners and seasoned delivery services pros to learn some best practices. First, for assessing if delivery services are right for your restaurant; then, how to pick a vendor.
Run the numbers.
For Cassandra Stokes, a Newk's Eatery franchisee, delivery was a no brainer. "Convenience is a movement. We're seeing increased sales in delivery, increased sales in grab and go. People are trying to spend more time at their desk and less time commuting back and forth for lunch. If you don't do it, you're missing out on market share; it's as simple as that."
But, she cautions, the numbers have to make sense. Service fees and other costs can create a deficit to your bottom line. Evaluate whether your pricing model could absorb some of the cost of adding a delivery service. "We include a slight markup on our delivery orders," says Stokes. "This helps us partially recoup the vendor fees."
Don't just base it off the numbers.
At least, not just the bottom line numbers. "You have to think about the top line, too," says Jay Clark, a Potbelly Sandwich Works franchisee. "There's a marketing value to it you have to consider. A benefit of being present in that marketplace." And, as Stokes pointed out, a competitive value. If you aren't participating in a space, you're losing out on an entire occasion for dining.
Assess your product.
Now that you know delivery services would make sense for your business financially and competitively, you need to make sure your product makes sense for delivery. "When it goes out your backdoor into a car, regardless of who [the vendor] is, how is your company and your brand represented when it gets to the front door of that customer?" Clark says, "It's important to...