To Use Or Not To Use Third Party Deliver Apps

Artificial Intelligence Analytics Big Data and Digital Transformation

There’s no denying that ordering food online for delivery is convenient. In fact, it’s so convenient a recent survey of consumers found 63% would rather have their food delivered than dine out with their family. What’s more, 87% of Americans agree using third-party food delivery services makes life easier.

As more and more people opt to stay in, restaurants must decide how they should meet demand. Does the ease of employing a third-party delivery service outweigh the service fees? Will taking on the hefty task of offering in-house delivery turn a better profit? Here is a brief look into both methods, their potential benefits, and how to get started.

Revenue from online food delivery is growing exponentially, with market volume projected to surpass $182,327 million by 2024. Why such considerable growth? Consumers not only appreciate the expedient access to eat at their favorite restaurants, but the opportunity to find a new favorite as well. Furthermore, 34% of consumers ages 18 to 24 report utilizing third parties to patronize restaurants without their delivery services.

Aside from reaching new customers, how else can restaurants benefit? With third parties, professional drivers are available without the hassle of hiring, training, and insuring. Additionally, many services offer a streamlined ordering process with a point of sale (POS) service ready to integrate with a payment method currently being offered. These make setting up food transport and payment straightforward from day one.

With in-house delivery, businesses can meet demands while retaining more of the profit. They can also encourage customer loyalty through their reward programs. Many third-party apps have promotions for loyalty, which possibly affect recurrent visits. This method can also see fewer errors, since the vendor has more control over the process.

After conducting research on which option is the best choice, a restaurant can partner with third-party apps or websites rather quickly. It takes creating an account, deciding on the menu items to include, and verifying the ordering and POS integration is up and running. However, such ease comes at a price, with service fees averaging 15% to 30%.

In-house setup is more challenging and time-consuming. It requires procuring the vehicles, insurance, and staff to meet consumer demands. There are also the intricacies of establishing a secure payment process and possibly a tracking system on which customers can rely. Lastly, there’s marketing responsibilities to get the word out on this latest upgrade.

There are benefits and drawbacks with both methods. Choosing one takes research and a systematic look into the business’s needs. That said, with analysts estimating 54 million consumers using food delivery apps by 2023, restaurants shouldn’t wait too long, or they could face being overlooked.

For further information on the risks and rewards of food delivery services, please see the accompanying resource.

Infographic created by Clover, a Restaurant POS company