On the upside delivery applications such as Doordash, Grubhub, and Ubereats can be a great way to get your Hot Ramen Now location exposure as well as customers. Some applications have a 30-60 day “free” period when you are new to the system, we encourage you to take advantage of the free periods.
However, these applications can and do take up to %30 after the initial period. Profit margins can be reduced to zero or even negative with such steep commissions for the third-party apps.
Applications such as Chownow and Ordernow can reduce commission costs but require you use their website and some of the costs are put on the customers for the service. In the end your customers get the same Doordash or Uber driver network.
App Drivers can be anyone. Although most drivers are acceptable, often they are less than desirable candidates to deliver food. Pajamas, cigarettes, and animals in the car are not unusual for the uncaring Doordash driver trying to make a quick buck. Sometimes just passing through town.
Another problem is when the app goes down or gets hacked which happens periodically.
Your own, In-House delivery drivers are your other alternative. This system can save you the application commissions but has its own drawbacks with delivery responsibility and liability on you. In many cases if things go wrong with a delivery the application pays for the food not the restaurant if there is an issue. Insurance and added payroll are also a consideration when having in-house delivery drivers.
Advantages of an in-house system include that customer data is kept by you and not a third-party app. You are in control of your food from a-z. You are in control of who delivers your food.
Of course, things change quickly and new applications and market options are always coming out.
The best bet is to have multiple options for sales that are optimized for profit in your particular market.
You can also turn applications on and off according to hours of the day and commission percentage.
For example turning off Uber and Grubhub during rush hours which have high commisions and or reducing commission tiers offered by Doordash from 30% down to 15% during peak hours or all together.
Many Franchises choose not to do business with applications.
When using delivery Apps always include aggressive gorilla marketing with menus, flyers, cards, or discounts included with every order giving the customer added value while giving you higher profit margins with direct orders.