Saw this article today: UBER kills of Instant Delivery
As we all know by now, delivery and logistics for getting our food to consumers is a challenge. I have always maintained that the business model for off-premise sales is evolving to a place where our restaurant community MUST understand the right business strategy behind takeout, delivery and catering.
As operators, our restaurant community is being bombarded with 3rd party delivery companies who claim to be the “next best thing” for the restaurant industry. These companies are being funded with millions and millions of dollars of VC capital, and they have spent ALOT on sales and marketing. Their objective? To see if they can ramp up adoption of their technology and services by consumers. This in turn, would provide them with enough business leverage to “squeeze” restaurateurs and force them to list their brands within the delivery companies ecosystem.
I have known for years that the business model for delivery ONLY works with large occasion group orders. And so, when it comes to these types of orders, I argue that the consumer solution that restaurants need to focus on is “Catering” and not large scale “Takeout”. Why? The reasons lie in the subtlety of the business strategy.
The differentiation between your “takeout” products and your “catering” products is a key component to achieving success with your off-premise business strategy. If done properly, menu optimization is a critical step towards designing a consumer solution that your brand can scale. A platter of sandwiches is a completely different product than a single sandwich in a bag, for example. To continue, a fruit platter requires a completely different manufacturing, assembly and packaging process when compared to making individual fruit cups.
To this end, I am a BIG believer , that because of the inherant risks that come with large value orders, restaurant companies are far better off ramping up and controlling their own deliveries for the catering channel.
This brings up the big question for our community. How do we manage “delivery for takeout orders?”
Well, one answer might be, focus on defining your catering program and the differentiation between takeout and catering. Then, when your customers want delivery, drive them to your catering channel for easier and a more predictable experience.
How do you make this paradigm shift in your organization? Listen to these wise words from Fred LeFranc, the founder at Results Through Strategy. He specializes in helping companies to make this kind of shift in their thinking.
Your customers and your operations will thank you for it.
Who is driving your off-premise business strategy? UBER? Door dash? Postmates? ….. I hope not.
Let’s talk catering!