Pros & Cons of Offering a Delivery Service

By Emily Royster

The manner in which we are ‘eating out’ is rapidly changing, especially as more millennials enter the workforce.  While dining-in occurs on average 2-3 time a week, 74% of millennials report a preference for delivery service from traditional restaurants, according to NRA.  With this evolution in dining, restaurants should consider adding a delivery option for their menu.  We have assembled the pros and cons to contemplate before setting up a successful delivery service for your establishment.

Pros


Restaurant Delivery Service Pros & Cons

  • New Revenue Stream
    A delivery service allows you to increase revenue despite having a limited number of seats in your dining room.  You can capture more orders on a busy Friday night.  A well-executed to-go service is a smart alternative that will generate new income and patrons.
  • Wider Market
    With a delivery service, you’ll need to market the convenience and advantages that it offers. Effective promotion of your menu and services includes a robust online presence.  Internet-based marketing gives your business far-reaching exposure and puts you in front of a whole new group of diners.
  • Overcoming Weather Woes
    A delivery service can keep business steady when the elements outside are bad.  When it’s raining, snowing or frigid cold, restaurants often see a dip in the number of guests and in sales.  Providing an option for patrons to dine in the comfort of their own homes can help you gain revenue that would otherwise be lost to Mother Nature.
  • Benefits of Digital
    An online ordering option helps to increase accuracy as well as provides a valuable database of customer information.  Users of the online system can specify whether they are allergic to gluten or how they would like their meat cooked.  Clarity in each order reduces meal preparation errors and costs. Best of all, you have a built-in library of customer information which can be used to send special offers and ordering incentives.

Cons


Eco-Friendly Takeout Containers

  • Potential Kitchen Setbacks
    Handling carryout orders can slow down your in-house service.  Since the same kitchen produces orders for both the delivery service and dining room, consider the potential challenges and disruption when there is an unexpected fluctuation in the number of incoming orders.
  • Space Wars
    You’ll need to establish sufficient space to prep delivery orders and store to-go containers and utensils.  For some restaurants, the required footage to operate your off-premise business may take away valuable dining room or kitchen space.
  • Labor Costs
    When your delivery service takes off, additional staff and supervision will be needed to coordinate the delivery orders. Anticipate the human cost factors for processing orders, preparing the meals, and packaging for delivery.
  • Driving the Bottom Line
    Consider all of the direct and indirect costs of delivering orders.  Depending on volume, third party meal delivery services are worth exploring.  Be sure to calculate their fees into your expense analysis which range from 10 – 30% of the bill.  If not relying on a third party delivery service, you’ll need a vehicle, insurance and delivery staff.

Remember to scope out what your competition is doing. And consider starting small by offering delivery for an area in close proximity to your business and later expand the service region as you scale your program.

TriMark R.W. Smith provides restaurants with a full range of tabletop collections, buffet essentials and quality kitchen products. With over 80 years of industry experience, our consultative style of service is profit-driven, sourcing the very best products to meet the unique needs of every business. We partner with each customer to offer cost-effective solutions and to support their prosperity and success. Discover how our experts bring excellence and ingenuity to the table every day.


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10 Comments on Pros & Cons of Offering a Delivery Service

  1. Braden Bills
    June 9, 2016 6:02 am at 6:02 am (3 years ago)

    I think it’s a good idea to have an option for customers to order food online. That way you can expand your market to a wider group of people! It makes things so much more convenient for your customers. Thanks for sharing!

    Reply
  2. Lanny Caliz
    March 8, 2017 10:54 pm at 10:54 pm (3 years ago)

    Superbly well written and informative blog post!

    Reply
  3. LNWeaver
    April 10, 2017 5:19 pm at 5:19 pm (2 years ago)

    That’s interesting that people might still order from a food delivery service when the weather is bad. Bad weather can often diminish business. I’ll have to try that the next time it’s dreary outside.

    Reply
  4. Kourtney Jensen
    May 16, 2017 8:00 am at 8:00 am (2 years ago)

    Growing up there weren’t many restaurants that delivered food, some pizza places delivered, but never any restaurants/ cafe type places. Recently I’ve seen an increase and really liked the benefits you pointed out from a business standpoint. From the consumer side, it is nice when on a Friday night you want to stay in with your friends to watch a game. You can call or order in what you want and have it delivered to you. From a business view, it is nice because you can have both in person customers as well as those who deliver, essentially doubling the customers at times. If I ever own a business, I would definitely have a food delivery option in order to boost revenue and customers.

    Reply
  5. Deliverr
    May 25, 2017 2:20 am at 2:20 am (2 years ago)

    One of my favorite blogs I’ve read in a while, Thanks for sharing

    Reply
  6. Jeremy Thompson
    December 26, 2017 8:26 pm at 8:26 pm (2 years ago)

    I like how you mentioned that delivery service is not only convenient for customers as they won’t have to leave the home just to get food but also to the restaurant itself for there will be an increase in revenue even if there are a limited number of seats in their establishment. That is perfect as it seems to be a win for us while also being a win for the restaurant which makes it equally beneficial for the consumer and the workforce. Hopefully, more and more restaurants would offer food delivery services as I hate going outside. I’m thinking a pizza would be a good delivery for tonight’s dinner. Thanks!

    Reply
  7. Tiffany Locke
    January 2, 2018 9:37 pm at 9:37 pm (2 years ago)

    I’m glad that you mention how a delivery service can help your customers get meals even when there is bad weather. This would be useful to keep them happy and ensure that they can continue to go to you. If someone wants to get takeaway, they’d probably want to find a restaurant that is near their home an offers delivery so that they can get their meals quickly, no matter the weather, in order to have warm food.

    Reply
  8. Derek Dewitt
    January 9, 2018 8:19 am at 8:19 am (2 years ago)

    I really wish more restaurants would embrace the idea of having a delivery service. I agree with you that more places would reach a wider audience, especially with an online ordering system. Some people have a hard time calling in or visiting places in person, so this would be really convenient for them. Thanks for sharing.

    Reply
  9. Bethany Birchridge
    March 28, 2018 8:49 am at 8:49 am (1 year ago)

    I really like that this mentioned that a delivery service can help keep business up even during bad weather. My friend is working on becoming an entrepreneur, so I think he’d be interested in reading this article. Thanks for the great article on how delivery service can benefit a restaurant.

    Reply
  10. Kit Hannigan
    September 18, 2018 4:32 pm at 4:32 pm (1 year ago)

    I couldn’t agree more about how you said that a delivery service allows you to generate new income and patrons. How I wish our favorite pizza place delivered their good stuff to our doorsteps. The restaurant can be too crowded for my roommates, so we just give up and find a new place to eat. A pizza delivery is really something the owner should really look into.

    Reply

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