With the growing number of food delivery services in Atlanta such as Uber Eats, Door Dash, GrubHub, Postmates etc, restaurant owners are seeing a huge chunk of their revenue eaten up but by these companies. In theory, they are supposed to bring in incremental business to the company, instead they are cannibalising existing business as current customers opt for the convenience albeit at a much higher price point.
Sure it seems convenient: place an order and have it deliver to your doorstep in less than an hour and you don't need to deal with wait times at the restaurant, or even deal with traffic. However consider all the costs you have to pay for a basic meal:
These companies charge restaurants 30% for the sale. They charge the customer delivery fees and even surge pricing during peak times. On top of that, the menu items on food delivery sites are generally more expensive, compare online menus of your favorite restaurant with their delivery service counterparts to see. A $10 meal at the restaurant ends up being almost $20 with Uber if you take in account fees listed above. Not to mention your meal isn't hot and run the risk of it being eaten. See recent articles: https://www.
In contrast, if you visit your neighborhood restaurant your food is newly prepared, not compromised and the restaurant keeps 100% of the hard earned money. Staff members would benefit from gratuities and relationships are built. Also, some delicious menu items just can't be delivered.
Running a restaurant has high overhead from perishable inventory, insurance, labor, marketing, rent and more. Sometimes the markup on food is very minimal because if it's too expensive it won't attract enough diners and employees rely on gratuities for a better wage. In many cases a 30% charge means the restaurant cooks for free after all fees are paid for while the delivery service gets all their profits. Often consumers don't realize that they are paying the the delivery service company and not the restaurant, so they end up calling the restaurant for complaints or demanding refunds for missing food (which most of the time is not the fault of the restaurant), mishandled food, late drivers and even customers giving bad reviews for a bad delivery experience when in fact all of this is not the restaurant's fault. (Any issues arise you call the delivery service, not the restaurant)
There are times when delivery makes sense: you are sick and shouldn't go out and about: it's bad weather outside, there is a high parking fee or no parking at all, or you have a party and want to order from different places. But if the restaurant is only 3 miles away (which is the general radius they would deliver to any way), come in and support your local business where you and the restaurant will benefit more instead of a third party middle man.
There are also other alternatives if you need delivery that aren't as crippling to restaurants:
- Postmates: Still a delivery service but no charge to the restaurant, Postmates doesn't tip the restaurant and usually charges the consumer delivery fee. It's a fee that other services charge anyway but is offset because consumers pay a non mark up menu price.
- Foodsby: Relatively unknown in Atlanta but growing. They are a service that requires the restaurant to deliver to the workplace for lunch. They only charge 7.5% and bring in consistent volume to the restaurant. Ask your business manager on how to sign up for their program for work lunch
- Online Ordering or Call the restaurant to pick it up. Grubhub charges the restaurant for orders that are picked up, so they are just the middleman. Most restaurants have their own online ordering system and you will pay menu price.
- Make friends with restaurant owner or manager. You'll be surprised how much they are willing to work with you. If you and coworkers order from a restaurant frequently and in high volume, you can likely arrange a delivery directly with them for lunch for absolutely no cost.
Many feel they have a frienemy relationship with delivery services, they can't live without it because if they are not on it, they lose business to a competitor. But if they are then customers that usually walk through the door end up buying through the 3rd party instead so it eats into restaurant earnings. As the delivery service grows, don't be surprised if many of your favorite restaurants disappear.
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