Third-party delivery

by David Klemt David Klemt No Comments

2023 DoorDash Ordering Trends

2023 DoorDash Ordering Trends: Canada & US

by David Klemt

Canada and the United States of America on a globe

After checking out this year’s annual Cravings Report we’re turning our attention to the 2023 DoorDash restaurant ordering trends reports.

Luckily, there are two reports available from DoorDash: one that focuses on Canada, and one for the US.

These two countries are, of course, KRG Hospitality’s primary markets. So, the data in these DoorDash reports is relevant and compelling for our current and future clients.

Perhaps unsurprisingly, Canadian and American DoorDash users are somewhat similar by a few metrics. However, where there are differences they’re fairly glaring.

For example, 78 percent of Canadian DoorDash survey respondents picked up a takeout order from a restaurant in the month prior to being surveyed. That number is 76 percent for American survey respondents.

Regarding in-person restaurant dining, 62 percent of respondents had done so the month prior. Among American survey respondents that number is 61 percent.

But when it comes to placing an order for delivery we see a notable difference. For Canada, 58 percent of survey respondents had ordered delivery. That number jumps to 77 percent among Americans.

This tells me a few (fairly obvious) things. Generally speaking, it appears consumers in Canada and America—according to DoorDash—prefer delivery and takeout to in-person dining. Going further, it seems that overall, Canadians prefer pickup or takeout to delivery. However, Americans seem to place delivery and pickup orders at nearly identical rates.

If it’s true that consumers favor delivery or takeout to in-person dining currently, there could be a couple of simple reasons. First, convenience.

Second, fees. It’s possible that today’s consumer perceives delivery fees are lower than in-person dining fees, unfortunately. If that’s the case, third-party delivery services can exploit this perception.

More Similar than Different

In comparing both DoorDash reports, I find that Canadian and American consumers who use DoorDash are rather similar.

Survey respondents in both countries indicate that Friday is the most popular day of the week to order food. Further, 6:00 PM is the most common local time to place orders in both countries.

And when it comes to the fastest-growing dayparts for order placement? In both Canada and the US it’s late-night and breakfast. Although, I most note that both dayparts are growing faster in Canada.

Nearly half of American respondents and a little over half of Canadian respondents indicate they want to try new restaurants and dishes.

Definitely not surprisingly, consumers in both countries primarily focus on menu selection and pricing when seeking a new restaurant to try. In fact, these numbers are identical for Canadians and Americans, at 55 percent and 51 percent, respectively.

Top Canadian Food Orders

When we look at the top items ordered via DoorDash, we don’t find anything out of the ordinary.

  1. Burgers
  2. Fries
  3. Pizza
  4. Salad
  5. Sandwiches

Looks like standard fare and comfort foods to me. This tells me that operators who have these items on their menus need to ensure they’re of the highest quality to stand out from other restaurants and bars.

Top American Food Orders

Interestingly but not too surprisingly, the list below is quite similar to the list above.

  1. French fries
  2. Burgers
  3. Tacos
  4. Salad
  5. Pizza

With the exception of tacos and sandwiches, the list is nearly identical.

Hey, who wants to debate whether tacos and sandwiches are in the same food family?

I encourage you to review both reports in their entirety for yourself. For the Canadian Edition of DoorDash’s report, click here. And click here for the US edition.

Image: Lara Jameson on Pexels

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2023 Cravings Report: “The Most” Orders

2023 Uber Eats Cravings Report: “The Most…” Orders

by David Klemt

Kentucky Fried Chicken packaged for delivery or pickup

Let’s take a look at the top orders, delivery requests, order combinations, surprising pairings, and more from the 2023 Uber Eats Cravings Report.

It appears that the chicken sandwich dominance we’ve seen over the years is winding down. At least, that seems to be the case among Uber Eats users.

As you’ll see below, not only is the chicken sandwich not the most popular item, it’s not even among the top five. It does edge out the cheeseburger and wings among the most popular combos, but it doesn’t outperform French fries and salt as a combo.

Another eyebrow-raising detail? Pizza doesn’t show up anywhere among the most ordered items, most popular combos, or even the most surprising combos.

Now, if you’re curious about the 2022 Uber Eats Cravings Report, you’re in luck. You can click here for the top food orders from that report, and here for the top beverage orders.

The Most…Ordered Items

  • French fries
  • Garlic naan
  • Pad Thai
  • Miso soup
  • California roll

Am I the only one who expected to see burgers, chicken sandwiches, and pizza on this list?

The Most…Popular Combos

  1. Burrito bowl + cheese
  2. French fries + salt
  3. Chicken sandwich + shredded lettuce
  4. Cheeseburger + mustard
  5. Wings + ranch

Fairly standard, really. Every one of these orders makes complete sense. Now, the category coming up next…it’s a different story.

However, before we move on, let’s compare these items to those found on the 2022 Uber Eats Cravings Report.

Interestingly, the number-one item is nearly identical: burrito + cheese. And French fries + salt is the second most-popular item on both lists.

The Most…Surprising Combos

  1. Steak + jelly
  2. Cottage cheese + mustard
  3. Condensed milk + avocado
  4. Seaweed + pasta sauce
  5. Butter + pickled onions

I really have nothing to say after reviewing this short list. I mean…hey, do your thing, everyone. Make your order yours.

To the operators out there, be ready for some odd order combos.

The Most…Popular Requests

  1. No onions
  2. Dressing on the side
  3. Ranch
  4. Extra soy sauce
  5. Spicy
  6. Sauce on the side
  7. No lettuce
  8. No jalapenos
  9. Extra gravy
  10. No slaw

Looking at the top request, Uber Eats has a theory as to what’s driving it: the return to the office.

People, it appears, are self-conscious about their breath in an in-person, face-to-face setting.

The Most…Popular Food and Alcohol Combos

  1. Ribeye + Vodka
  2. Cheeseburger + Frozen Margarita
  3. Chicken + Frozen Piña Colada
  4. Lobster tail + Apple whiskey
  5. Tamales + Daiquiris

Last year’s report reveals the following combos:

  1. Steak + Margaritas
  2. Pizza + White Claw
  3. Burritos + Margaritas
  4. Chicken + Sangria
  5. Wings + Beer

Overall, a lot of change from the 2022 Cravings Report to this year’s report.

Image: Nik on Unsplash

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Top 2022 Grubhub & Uber Eats Drinks

Top 2022 Grubhub and Uber Eats Drink Orders

by David Klemt

Margarita with dehydrated citrus garnish

The year-end Grubhub 2022 Delivered and 2022 Uber Eats Cravings reports identify this year’s delivery order drink trends.

Last week, we dove into Grubhub and Uber Eats’ top food orders. If you haven’t already, read that article here.

This week we’re going to check out what drinks were most popular in 2022 for both platforms.

Top Grubhub Coffee Orders

People are still working from home, full- or part-time. So, it makes sense that consumers are placing coffee orders for breakfast, snack, and lunch dayparts.

  1. Iced Coffee
  2. Hot Coffee
  3. Iced Caramel Coffee
  4. Iced French Vanilla Coffee
  5. Frozen Coffee

Top Grubhub Milk Alternatives

Of course, with coffee orders come milk orders. And as you’re probably well aware, milk alternatives are only growing more popular with consumers.

So, below are the top milk alternatives among 2022 Grubhub users.

  1. Oat Milk
  2. Almond Milk
  3. Coconut Milk
  4. Soy Milk
  5. Cashew Milk

As a possible explanation for the dominance of oat milk, sustainability could be a driver. According to available data, producing a pound of oats is much more sustainable than producing one pound of almonds.

It’s believed that oats are more favorable when it comes to basically every measure of sustainability.

Top Grubhub Alcohol Orders

I can’t say that I’m shocked to find the Margarita is the top cocktail order. It is, after all, the long-reigning Queen of Cocktails.

  1. Beer
  2. Margarita
  3. Hot Sake
  4. Piña Colada
  5. White Wine (Sauvignon Blanc)

I’ll admit that I’m slightly surprised that a red wine isn’t among the top five.

Top Uber Eats Alcohol Orders

Interestingly—perhaps a bit frustratingly—Uber Eats took a different approach to identifying their top drinks.

Rather than dedicating space solely to alcohol orders, their top drinks are part of combinations. As in, the “most frequently paired food + alcohol” combos.

So, here’s their list in its entirety:

  1. Steak + Margaritas
  2. Pizza + White Claw
  3. Burritos + Margaritas
  4. Chicken + Sangria
  5. Wings + Beer

However, there’s another drink in the Uber Eats “most unexpected food combos” section:

  • Ham + Cream Cheese
  • Fruit Roll Up + Hot Cheetos
  • Pickles + Whipped Cream
  • Popcorn + Pickle Juice
  • Dark Chocolate + Tomato Salad
  • Pizza + Applesauce
  • Sushi + Ranch
  • Peanut Butter + Pizza
  • Cheese + Martinis
  • Watermelon + Mustard

Therefore, we can reasonably extrapolate that the top 2022 Uber Eats alcohol orders are the Margarita, White Claw, Sangria, beer, and Martini.

Takeaway

If we compare reports and look for similarities, we see that two drinks are at the top: beer and Margaritas.

Both make sense. Beer, in can, bottle, and growler forms, travels very well. That makes beer ideal for delivery where it’s legal.

And as far as Margaritas go, there’s a wide array of canned options available. Again, canned cocktails travel well for delivery. Of course, restaurants and bars can also obtain the equipment to prebatch and package their signature Margaritas.

Ideally, your POS system can run reports to identify which drink orders are most popular for your delivery customers. Also ideal: operators should take as much control over their business as they can, implementing direct delivery as long as it’s feasible.

So, look into direct delivery, run your reports, and take more control while reducing costs.

Image: Edward Howell on Unsplash

by David Klemt David Klemt No Comments

Canada’s Top 2022 DoorDash Orders

Canada’s Top 2022 DoorDash Orders

by David Klemt

Burgers, French fries and milkshakes

Operators curious about the most popular delivery items in 2022 will be happy to learn that DoorDash’s year-end report is ready for viewing.

Those who want to compare it to predictions from several sources earlier this year can click here. The DoorDash Canada report can also be compared to consumer trends in Canada revealed back in October.

Before we jump in, I’m not detailing the DoorDash report in its entirety here. To review the entire report, please click here.

Instead, I’ll be sharing the top takeaways in terms of top menu items; top cuisines; and top items by province.

Speaking of provinces, a word to New Brunswick, Newfoundland and Labrador, Northwest Territories, Nova Scotia, Nunavut, Prince Edward Island, and the Yukon. Please don’t break out the pitchforks and come for me for not including you in this article. DoorDash’s report only covers data from six provinces—I didn’t leave you out intentionally.

Top DoorDash Cuisines in Canada

  1. American
  2. Mexican
  3. Japanese
  4. Thai
  5. Mediterranean
  6. Indian
  7. Chinese
  8. Italian
  9. Korean
  10. Filipino

Top DoorDash Items in Canada

  1. Burgers & Fries
  2. Fried Chicken
  3. Poutine
  4. Sushi Rolls
  5. Chicken Wings
  6. Burritos
  7. Chicken Rice Bowl
  8. Shawarma Wraps
  9. Curry
  10. Pad Thai

I think there’s one key takeaway that stands out in regards to this list. Notably, it appears that while chicken isn’t number one, it’s undeniably popular amongst Canadian DoorDash users.

In fact, according to DoorDash data, chicken reigns supreme in British Columbia. When you reach the province-specific sections below, you’ll see how powerful the cravings in BC are for chicken.

Top DoorDash Late-night Items

Again, chicken rules the DoorDash roost in this category.

  1. Chicken Nuggets
  2. Fries
  3. Poutine
  4. Chicken Wings
  5. Chicken Burgers
  6. Apple Pie
  7. Cheeseburger
  8. Spinach & Cheese Dip
  9. Chocolate Fudge Sundae
  10. Crispy Chicken

Top DoorDash Items: British Columbia

  1. Burrito Bowl
  2. Szechuan Chicken Lettuce Wraps
  3. Butter Chicken
  4. California Roll
  5. Crispy Chicken Sandwich
  6. Tofu Bowl
  7. Chocolate Chip Cookies

Top DoorDash Items: Ontario

  1. Cheeseburger
  2. Coffee
  3. Burrito Bowls
  4. Chicken Shawarma
  5. Crispy Chicken
  6. Bagels
  7. Pad Thai
  8. Beef Patty
  9. Pizza
  10. Onion Rings

Top DoorDash Items:Alberta

  1. Spinach and Cheese Dip
  2. Chicken Cheddar Sandwich
  3. Chilli Chicken
  4. Kale Salad
  5. Margarita Pizza
  6. Hot Apple Turnover

Top DoorDash Items: Québec

  1. Poutine
  2. Cappuccino
  3. Pad Thai
  4. Steak and Cheese
  5. Croissant
  6. Dumplings
  7. Chips
  8. Tacos

Top DoorDash Items: Saskatchewan

Interestingly, a beverage item holds the top spot in Saskatchewan.

  1. Bubble Tea
  2. Pepperoni Pizza
  3. Pork Bun
  4. Crispy Pork
  5. Garlic Bread
  6. Pasta

Top DoorDash Items: Manitoba

  1. Fries
  2. Butter Chicken
  3. Red Velvet Cake
  4. Poke Bowl
  5. Shawarma Wrap

As I stated in Wednesday’s article detailing Grubhub and Uber Eats’ reports for the US, we believe operators should take as much control over their restaurants and bars as possible. At KRG Hospitality, that means implementing direct delivery if it makes sense: ease of use, delivery capabilities, favorable costs, etc.

It’s also helpful to know what consumers in your area are craving and ordering. Such information can provide a useful baseline for many concepts’ menu development.

Image: John Fornander on Unsplash

by David Klemt David Klemt No Comments

$23.82 Minimum Wage for Delivery Workers?

$23.82 Minimum Wage for Delivery Workers in NYC?

by David Klemt

Red "New York" sign on building

With a public hearing on the docket for December 16, the New York City Council is proposing “fairer pay for delivery workers.”

The move is a year in the making. Last year, the NYC Council approved legislation with the goal of improving delivery worker pay and working conditions.

Now, the council is moving to increase minimum wage for the 60,000-plus delivery workers in the city.

At the risk of coming across as pessimistic, the legislation is likely to be unpopular with third-party delivery services. After all, when NYC and San Francisco passed laws to cap third-party delivery commissions, the big services filed lawsuits.

So, again, increasing the minimum wage for delivery workers in NYC will probably not go down well with companies like Uber, DoorDash, and Grubhub.

It’s possible we’ll find out before the end of this year. After the public hearing, the NYC Council will consider public comments. Then, the council could move forward and enact the legislation.

What’s in the Proposal?

Should the rule go into effect after the public hearing on December 16, minimum wage would rise to $17.87 per hour for third-party delivery workers. By April 1, 2025, that rate would increase to $23.82.

“This new proposed minimum pay rate would help ensure a fairer pay for delivery workers for third-party apps, providing more stability for 60,000 workers across our city,” says New York City Mayor Eric Adams.

According to reports, Brooklyn Borough President Antonio Reynoso is in favor of the legislation as well.

“It’s absolutely unacceptable that the restaurant delivery workers who provide for so many in this city are not justly compensated for their time, reimbursed for their expenses or provided essential benefits,” says Reynoso.

So, how did the council arrive at the $23.82 per hour figure? Well, we actually have that information:

  • $19.86, which matches standards set by the New York City Taxi and Limousine Commission for ride-hail drivers;
  • $2.26 for expenses delivery workers incur; and
  • $1.70 for worker’s compensation.

Why Legislate Delivery Worker Pay?

It appears the main reason is an incredibly simple one. In short, third-party delivery workers aren’t making minimum wage in NYC.

Per the Department of Consumer and Worker Protection (DCWP), delivery workers average less than the city’s $15 minimum wage. With tips, they’re averaging $14.18. And without tips? As one can imagine, the hourly rate plummets: $7.09 per hour.

According to the DCWP, the average hourly expense a delivery worker incurs is $3.06. So, that drives their hourly pay to $11.12 with tips, $4.03 without.

In an argument likely to be cited in any lawsuit filed by DoorDash (or at least shared in a public statement), the company claims its delivery workers make almost $29 per hour.

Clearly, there’s a discrepancy somewhere. Either delivery drivers are woefully underpaid for the service they provide or multiple researchers are misinterpreting hourly pay data.

Several sources have cited a statement made by a DoorDash representative about the NYC Council’s proposal:

“Dashing allows so many across New York City to earn when, where and how often they choose,” says the rep. “Unfortunately, the proposed rule does not appropriately account for this flexibility or that Dashers are able to choose which deliveries they accept or reject.”

Their statement continues, addressing a possible rise in costs and drop in orders:

“Failing to address this could significantly increase the costs of delivery, reducing orders for local businesses and harming the very delivery workers it intends to support.”

Why Should I Care if I Don’t Operate in New York City?

We’ll see—quickly, apparently—if this proposal becomes law. Should that happen, there’s reason to assume similar proposals will pop up in other cities and states.

We’ll also see whether or not third-party delivery companies file lawsuits in response. They’ve done so for commission caps, after all.

At any rate, this is one to watch. Similar legislation could be coming to your market.

Image: Nik Shuliahin 💛💙 on Unsplash

by David Klemt David Klemt No Comments

How a Chain Lost My Business Forever

How the Staff at a National Chain Lost My Business Forever

by David Klemt

Chocolate cookie and cookie crumbles

An unfortunate and entirely avoidable guest experience debacle guarantees that I’ll never spend another dollar at a particular national American chain.

What was supposed to be a small treat and excuse to get outside for a bit went downhill quickly.

Now, before I begin, I tend to shrug at poor service. Truly, a front-of-house team member has to go pretty far for me to do more than raise an eyebrow.

Given how the past two years-plus have gone, my tolerance has only grown. Everyone has bad days, including restaurant, bar, and hotel staff. In fact, I tend to assume that someone is simply having an off day due to an array of reasons: working several days in a row, opening and closing multiple times a week; having more responsibilities heaped on them due to being short staffed; a seeming increase in abuse from guests; stress spilling over onto the job; etc.

However, that doesn’t mean I’ll always return to be subjected to poor service in the future. What I experienced yesterday falls into this category: I won’t spend my money with this chain ever again.

Third-party Issues

As stated above, my visit to this national chain (600-plus locations) was intended to be a small treat. It was Halloween, they specialize in a particular type of confection, so why not?

Also, the temperatures have been in the 70s and lower in Las Vegas—perfect for a trip on my motorcycle. So, two treats in one, really.

Okay, so I’m going to do something I don’t like doing here: making an assumption or two. I think, however, I’m basing them on sound reasoning.

Additionally, I don’t like to use third-party delivery. In this case, the order was placed via Uber Eats for pickup using a monthly credit. Zero offense to third-party delivery drivers—it’s the corporations behind the services and the fees they charge operators I don’t support.

So, my assumption is that because the order came in via Uber Eats the staff figured I was “just” a delivery driver.

Downhill Fast

I’ll concede that this visit didn’t start off on the wrong foot: I received a decent welcome. Since I was picking up the order, I stood at the pickup counter, and confirmation came in before I arrived that the order was ready.

There were three guests waiting when I walked in, and one by one they got their orders and left. I didn’t think anything was going wrong until people walked in after me and received their orders. In terms of this chain, my order was on the smaller side.

After several minutes of being ignored, I was asked if I was picking up for Uber Eats. I clarified that no, I’m not an Uber Eats driver, I was picking up my order placed via Uber Eats.

Another several minutes went by as I watched larger orders get fulfilled ahead of mine. And then I was asked again—by the same staff member—who I was picking up for. Again, not an Uber Eats driver—my order.

At this point, I had been waiting more than 10 minutes. When I was finally given my order, I noticed another difference. Staff members showed guests their orders to confirm the contents before handing them over. My order, however, was taped closed behind the counter and handed to me.

It didn’t strike me that this is how this staff treats Uber Eats driver until I was on my bike. And that’s the problem.

Standards of Service

If this is how staff treats third-party delivery drivers, it’s appalling. There’s no excuse for treating drivers differently just because they aren’t the guest themselves or fellow employees.

Let’s be clear: anyone walking through a restaurant, bar or hotel’s doors deserves at least decent service. There are several reasons for this, and I shouldn’t have to address them. But, hey, we’re already here, so why not address a couple?

First, standards. If your staff is purposely treating a group of people poorly because they think they can do so without ramifications, your standards have slipped or there simply aren’t any. That’s a problem.

Are team members going to get to know regulars? Absolutely. Are they going to have favorites. Of course! And there’s nothing wrong with that. In fact, that’s what should happen—every front-of-house team member should cultivate their own regulars.

So, yes, some guests will treated differently. There’s a huge difference, however, between subjecting some guests to poor service intentionally and delivering outstanding service to favorites.

Quite simply, the minimum standard of service should be great service. “Decent” sucks; great should be the baseline.

Regulars and guests who staff have rapport with should receive service that’s above and beyond the standard level. Rock star servers and bartenders deliver outstanding service to everyone, regular or first-timer, gracious guest or grump.

Different Treatment?

Second, your staff shouldn’t be treating third-party delivery workers like they don’t matter. There’s zero room in hospitality for treating people poorly—doing so is in direct opposition to the spirit of this profession.

In fact, they shouldn’t treat difficult guests with anything but your expected standards. Leadership team members should be confronting rude or difficult guests, protecting the rest of the team.

I’ve read and heard about restaurant staff treating third-party delivery drivers poorly. Always, of course, with justifications thrown in: retaliation toward rude drivers, drivers not tipping…pick a reason. Again, if there’s a rude driver, staff should alert leadership and they should handle it.

Look, I’ve made no secret of my view on third-party delivery apps. Their fees and taking advantage of operators, particularly during the pandemic, infuriate me. And it’s easy to point at me and say I’m part of the problem, using a credit to place a third-party delivery. I’ll accept that criticism.

What I won’t do is return to a business with staff who think it’s acceptable to allow standards to slip and treat delivery drivers poorly. Most people seem to take delivery jobs to make ends meet. Hell, some of them are likely service industry professionals themselves working another job or jobs.

The labor shortage isn’t a valid justification for slipping standards or poor service. Dislike of third-party delivery services is no justification, either.

In fact, this chain obviously sees these delivery services as a viable income stream. The fact their staff doesn’t is a problem. If there’s a standard of service for this chain, it certainly wasn’t met when I was there. And if there’s a standard that I didn’t receive, there are several other problems.

Either way, the damage is done.

Image: Andre Moura via Pexels

by David Klemt David Klemt No Comments

The Numbers on Food Delivery in Canada

The Numbers on Food Delivery in Canada

by David Klemt

Burger in container inside car

For most restaurants, delivery is now a crucial service element rather than a “nice-to-have” option a small percentage of guests expect.

This is true whether your restaurant is in the US or Canada. But who’s placing orders? How are they ordering? And will they continue to order for the foreseeable future?

Well, Restaurants Canada has answers to all those questions and more. So, we let’s take a look at what their 2022 Foodservice Facts report says about delivery.

To download your own copy of this informative report, click here.

Who’s Placing Orders?

In their 2022 Foodservice Facts report, Restaurants Canada looks at three age groups:

  • 18 to 34
  • 35 to 54
  • 55-plus

Perhaps unsurprisingly, the 18- to 34-year-old cohort leads the charge when it comes to ordering delivery. It’s also not surprising that 35 to 54 comes in second, and 55 and older is third.

However, the first two groups are closer than some may assume. Eighty-three percent of the the 18 to 34 cohort placed orders at quick-service or full-service restaurants between December 2021 and May 2022.

That number does drop for the same time period among the 35 to 54 group, but not by a significant amount. Of that cohort, 77 percent ordered delivery. Just over half of the 55-plus group placed delivery orders: 52 percent.

Now, those numbers are down a bit from 2021, which makes sense. Things were much more restrictive in 2021 and people were just getting back to a sense of normalcy at the start of this year.

In 2021, the delivery order percentages were:

  • 18 to 34: 89 percent
  • 35 to 54: 81 percent
  • 55-plus: 67 percent

Looking at these numbers, it appears the 55-plus cohort is more comfortable dining out in person. Conversely, the 18 to 34 age group is clearly comfortable making delivery a part of their everyday lives.

How do People Want to Order?

Believe it or not, your website still matters. I’ve been saying this for years but the pervasiveness of delivery and takeout ordering is really driving this point home.

The fact is, a notable percentage of your guests want to support your restaurant and staff directly. Over the past couple of years, consumers have become well aware that third-party delivery services are incredibly costly for operators.

Consumers are also aware of third-party delivery debacles, such as the abysmal Grubhub “Free Lunch” mess from May of this year.

So, direct delivery is something that operators need to at least consider. Implementation is often less difficult than most business owners believe. And many platforms, SevenRooms, for example, make implementing direct delivery simple and affordable.

Interestingly, Restaurants Canada data supports the need for direct delivery. Back in May, the industry advocacy organization asked survey respondents how they prefer to place delivery orders from restaurants.

Preferences for QSR customers:

  • No preference: 10 percent
  • Over the phone: 19 percent
  • Third party: 35 percent
  • Restaurant website or app: 36 percent

Full-service customer preferences:

  • No preference: 8 percent
  • Over the phone: 28 percent
  • Third party: 29 percent
  • Restaurant website or app: 35 percent

Honestly, I find it surprising anyone calls a QSR to place an order. However, I suppose that makes sense for an office or catering.

At any rate, make sure your website is up-to-date, you offer direct or “last-mile” delivery, and make it easy to navigate your menu and the ordering process.

Is Ordering Here to Stay?

Now, we all know why restaurant delivery has been supercharged the past two years. However, consumer trend data show that delivery was on the rise before the Covid-19 pandemic.

But now that people are eager to return to normal and the industry is on its way to returning to pre-pandemic levels, is delivery really here to stay?

According to another question asked of survey respondents by Restaurants Canada, more than half of QSR and full-service restaurant customers plan to stick with delivery.

For their 2022 Foodservice Facts report, Restaurants Canada asked back in May how often consumers planned to place delivery orders in the next six months.

Order frequency for QSR customers:

  • Never placed a delivery order and don’t plan to now: 29 percent
  • Order less often: 20 percent
  • Will order with the same frequency: 45 percent
  • Will order more often: 7 percent

Frequency of orders for full-service customers:

  • Never placed a delivery order: 24 percent
  • Order less often: 23 percent
  • Will order with the same frequency: 44 percent
  • Will order more often: 9 percent

Here to Stay?

Of course, there are multiple factors feeding the numbers above. Some people simply don’t like ordering and waiting for delivery. For these consumers, the practice doesn’t just seem convenient.

There’s also the consumer demand to return to in-person dining, socializing with family and friends. And, of course, meeting new people while dining out.

We must also consider inflation and rising costs. Often, restaurant spending is among the first to be reduced when consumers need to be more frugal. Rising menu costs are sure to curtail some delivery spending.

That said, it’s clear delivery is here to stay and must be considered a crucial element for most restaurant operations. QSR and full-service operators need to bear in mind is placing orders; how often they’re placing orders; and get them in the habit of placing orders directly.

Image: Oliur on Unsplash

by David Klemt David Klemt No Comments

Alright, Seriously—WTF, Grubhub?

Alright, Seriously—WTF, Grubhub?

by David Klemt

Or, more to the point, stop working with “partners” who exploit our industry rather than support it.

In spectacular and entirely predictable fashion, Grubhub’s “free lunch” further reveals that third-party delivery platforms don’t care about restaurants.

Of course, they all say they support restaurant owners and operators. And, of course, they’re quick to pat themselves on their backs for being a pandemic lifeline.

But…no. Time and time again, mainly through their exorbitant and exploitative fees, they prove the opposite is true.

Restaurants and bars aren’t third-party delivery partners. Rather, these relationships are adversarial and detrimental. So much so, in fact, that some states passed laws to limit third-party delivery fees.

In Nevada, for example, Clark County Commissioners passed an emergency ordinance in August 2020 capping those fees at 15 percent. Clearly, we need to stop enriching companies that prove they don’t support the hospitality industry but cause it significant harm.

Free Lunch?

They say there’s no such thing as a free lunch. Apparently, Grubhub really wants to prove that maxim true.

That’s one of the takeaways from their disastrous promotion. Last Tuesday, in what’s being reported as an attempt to claim the delivery throne in New York City, Grubhub offered “free” lunch to anyone who placed an order for delivery.

The requirements for this promotion? Place an order for delivery through Grubhub on May 17 between 11:00 AM and 2:00 PM and use the code “freelunch.”

Of course, customer orders weren’t entirely free. Rather, the code was good for a $15 discount. Still, a wildly attractive offer as the ensuing debacle reveals.

Unsurprisingly, the promotion made for some eye-grabbing and eye-rolling headlines. Buzzfeed News published the most attention-grabbing one: “GrubHub Was Getting 6000 Orders A Minute During Its Promo Today That Left Restaurant Workers Stressed And Customers Hangry.”

Six thousand orders per minute during a promotion with a three-hour window in a single market.

In addition, the outlet reported that one unsatisfied customer was number 3,630 in the Grubhub customer service queue. Apparently—and who can blame him—he hung up before he could speak with a Grubhub rep about his missing order.

Duh

Who could’ve seen this coming? Any of the restaurant owners, operators, or team members Grubhub “serves,” that’s who.

In fact, anyone who works in this industry with on-premise experience knew this was going to happen. So, too, any journalist who specializes in hospitality.

The fact that whoever came up with this promotion didn’t see this coming is revealing. Unless the creators of these apps and services have real-world restaurant experience, they don’t understand the business.

How can one effectively and properly serve an industry without an understanding of how it operates? Hospitality is about service. Shouldn’t the companies attempting to work within our industry work hard to serve alongside us?

Let’s be clear—this promotion was in no way designed to help struggling restaurants. It wasn’t intended to boost their traffic and revenue. Rather, it was solely created to serve Grubhub’s desire to be number one.

As we all know, we’re experiencing major staff shortages. There are also supply shortages making it difficult for operators to obtain product reliably. Grubhub made those problems exponentially worse.

Some restaurants stopped taking delivery orders. Others canceled orders. There were operators who closed in an effort to catch up with orders and prevent the situation from worsening.

According to news stories, some social media users posted that they planned to stop ordering through third-party platforms.

Negative Impact

If you’re new to KRG Hospitality, welcome. You’re likely realizing that we’re not fans of third-party delivery.

Those of you who are familiar with us have known for quite some time that we support direct delivery. That is, delivery controlled and executed by the restaurant itself.

It’s not that we’re against innovation. Rather, our dislike of these platforms, generally speaking, comes from our perception of their behavior.

In our opinion, they take control away from operators and cost them money. Again, speaking generally, they collect customer data that operators should control. Their fees are ridiculous in most cases. And when it comes to the customer experience, their inconsistencies and shortcomings reflect poorly on the operators far too often.

Studies show that customers who have issues with third-party deliveries often place the blame on the restaurant. Food the wrong temperature? Order arrive late? Packages in less-than-ideal condition? While those issues and others can be the fault of the driver, the restaurant often takes the brunt of a customer’s dissatisfaction.

Of course, there’s also the financial impact of third-party delivery on restaurants. A SevenRooms report from last year reveals how these platforms harm operators and their bottom lines.

The Solution

Look, we know operators have a ton on their plates. But protecting and boosting the bottom line is a non-negotiable element of this business.

Yes, it’ll take some time, effort, and money to set up direct delivery. However, it’s the best solution.

Direct delivery means the operator collects and control valuable data. Likewise, the operator can ensure consistency. Through direct delivery, the operator shapes and controls the experience.

Control. Inherently, third-party delivery takes some control away from operators. That’s not a good thing, and neither is their financial impact.

Look into setting up direct delivery, take control, and protect your revenue ASAP. Friend of KRG “Rev” Ciancio and SevenRooms CEO Joel Montaniel each address delivery on the Bar Hacks podcast. Listen to episode 13 with Rev and episode 24 with Joel to learn more about delivery.

We need to stop rewarding companies that exploit our industry and take advantage of our owners, operators, and hard-working staff members.

Direct delivery is the answer. Take steps to implement it today.

Image: Rosie Kerr on Unsplash

by David Klemt David Klemt No Comments

What Consumers Expect from Delivery

What Consumers Expect from Delivery

by David Klemt

Delivery or takeout food order in brown paper bag

Consumers are developing specific behaviors and opinions regarding delivery that impact their perception of restaurants and brands.

Over the course of two years and three surveys, Deloitte has attempted to learn more about consumers and delivery.

In total, Deloitte surveyed 1,550 restaurant customers. Additionally, the multinational interviewed highly positioned executives from ten casual, fast-casual, and QSR brands.

What Consumers Want

First, it should come as no surprise that delivery is here to stay. None of Deloitte’s survey results indicate otherwise.

In fact, it appears that some consumers are showing an interest in additional delivery methods. Half of survey respondents are willing to try driverless or drone delivery.

More than half—64 percent—don’t expect to return to pre-pandemic dining habits by March of this year. Illustrating the habit of ordering takeout and delivery, 61 percent of respondents engage with restaurants that way at least once per week. That represents a 32-percent increase from June 2020 to September 2021.

When dining off-premise, 57 percent of Deloitte survey respondents prefer to place orders via an app. However, 40 percent of respondents prefer a restaurant’s own branded website or app. That shows that:

  1. A restaurant’s website matters. A significant percentage of consumers want to get information, get a feel for a restaurant, and place orders with a business directly.
  2. Direct delivery is feasible. Consumers want to know and feel as though they’re supporting a restaurant directly rather than a third-party business.

Own the Delivery Experience

Of course, quality is a concern with consumers who place delivery orders. This points to another pitfall regarding third-party delivery beyond the fees.

Unfair as it is, three out of five restaurant customer survey respondents have quality expectations. Specifically, they expect the same food experience off-premise as they receive on-premise. That means the same quality and the same freshness.

They also indicate that wait times of up to 30 minutes are acceptable. Here’s where the risk to restaurants comes into play. Consumers will fault the restaurant for late orders; cold food (or melted or room-temperature food for cold items); iced drinks becoming watered down; and other order issues even if they’re delivered by third-party services.

So, operators must look into and invest into what they can to improve the quality of delivery orders. Containers that keep hot food hot, French fries and other fried foods crisp, and cold foods cold are paramount.

Unfortunately, problems that occur after an order has left a restaurant—which are out of the business’ hands—are often attributed to the venue. Another reason, then, to consider and implement direct delivery.

Image: Yu Hosoi on Unsplash

by David Klemt David Klemt No Comments

SevenRooms Reveals Third Party Impact

SevenRooms Reveals Third Party Delivery Impact

by David Klemt

Person using Uber Eats on their iPhone

New findings from SevenRooms, the powerful reservation and guest relationship platform, show the impact third-party delivery has on restaurants.

In partnership with YouGov, a respected internet-based market research and data analytics firm, SevenRooms finds that direct delivery saves operators thousands of dollars per month.

The overall finding of the “Data & Dollars: Revealing the Impact of Third-Party Marketplaces” report is startling. Operators are relying on a technology that in reality is harming them and their bottom line.

Cost of Convenience

Foodservice operators and workers, along with being hospitable in their mission to serve others, are adaptable.

The industry proves this time and time again. This is particularly true of the past 12 months.

Nimble operators pivot quickly, so it makes sense that so many restaurants, bars and other foodservice businesses embrace delivery, takeout and curbside pickup. Doing so is a direct and seemingly logical response to a major shift in consumer behavior to lockdowns, restrictions, and health concerns.

Most operators are well aware that state third-party delivery platforms take a 30-percent commission on average. However, the cost goes beyond devastatingly high fees: operators also lose control of the guest journey.

Real-world Example

SevenRooms illustrates the negative financial impact third-party delivery platforms with three examples: a high-end Italian restaurant in New York; a high-end steakhouse in Los Angeles; and a high-volume casual restaurant in California.

Let’s take a look at the last example.

Over a six-month period, the restaurant fulfills 19,000 combined orders. Delivery makes up 75 percent of these orders, takeout/pickup account for 25 percent. The average order is $33, and over the six-month period the total order volume is $617,500. Had the restaurant implemented direct delivery rather than third-party, they would have saved about $154,000.

Break those savings down and the restaurant would save approximately $25,600 per month that could go to:

  • PPE: 853 boxes of face masks or 196 boxes of gloves.
  • Takeout: 101,000 food containers.
  • Guest experience: 522 tanks of propane to keep guests warm on patios.

Using an average rent amount of $6,000-15,000 per month in Los Angeles, that’s also two to four months’ rent.

Guests Support Direct Delivery

The impact of third-party delivery on restaurants isn’t lost on consumers. Many view ordering food as more than just convenient, they see it as a way to support their favorite businesses.

Luckily, consumers are supportive of ordering delivery, takeout and pickup directly from restaurants.

Per SevenRooms:

  • Firstly, 37 percent of Americans are eager to do anything they can to help restaurants.
  • Nearly half, 48 percent, think it’s more economical to order directly from a restaurant.
  • 28 percent who say they prefer ordering directly to third-party delivery feel that way after seeing their favorite restaurants suffer.
  • 23 percent are informed and think third-party delivery platforms charge restaurants too much in fees.
  • 16 percent feel that the harm done to restaurants by third-party delivery outweighs any benefits.

Leverage Direct Delivery Support

SevenRooms identifies several ways in their report that operators can succeed in getting consumers to order directly.

One way is the platforms’ own Direct Delivery solution. We speak to SevenRooms CEO Joel Montaniel about this solution on our Bar Hacks podcast.

Then, of course, there are an array of incentives consumers are willing to accept in exchange for direct delivery and ordering:

  • 41 percent of Americans would order directly over ordering via third-party if a restaurant has its own app with features such as tracking and communication.
  • 37 percent consider a complimentary item such as an appetizer, drink or dessert in addition to their order an appealing incentive.
  • 32 percent like the idea of a personalized promotion applied to a future order or in-person visit.
  • 28 percent indicate interest in a personalized promotion for their meal such as a discount code or comp item.
  • 17 percent are fans of restaurants using ordering history to customize their menu and experience.

Read the entire report here. To learn more about SevenRooms, please click here. Connect with SevenRooms on Twitter, Facebook, LinkedIn and Instagram.

Image: cottonbro from Pexels

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