Many restaurant operators flock towards Delivery Services, Daily-Deal Companies,“Marketing Partnerships” in order to help drive top-line sales. We’ve broken down a handful of the most frequented types of services that we continue to see on an increased basis.
Direct Delivery Services
- Within Direct Delivery services, a customer orders from the service, the order gets placed to you, and finally, picked up and delivered to the customer – FOR A FEE TO YOU – the restaurant owner
- Fees come in as low as 10% and as high as 40% depending on the service chosen
- Orders could be as small as a single menu item
- In using a service like this you can expect to receive payments as often as weekly yet as infrequently as the month’s end
- In most cases, the company placing the order will take fees out of what is deposited to you
Delivery/Catering Services
- This service typically satisfies larger orders or multiple meals based around business centers where large groups are meeting
- There are always exceptions to the rule, but for the most part, they work very much like the Direct Delivery Services in terms of payments and fees
- You’re simply seeing larger orders coming in
Marketing/Ordering Sites
- These sites “partner” with restaurants in your area and promise to drive your sales up and increase your awareness in the market through their site
- They do not offer Delivery Services of their own so you have to provide delivery
- Since they are essentially “delivering” you a new customer you can expect to see a fee taken for said service
Discount/Couponing Sites
- On these sites, a customer makes a purchase from the offering company that in turn pays you a small fraction of what was received
- You then provide a discount on your products or offer freebies when the guest comes in
- These often benefit the Offering Company and the purchaser, but a loyal consumer is not earned unless another offer is made at a future time
- This potentially earns you instead,once-in coupon clippers
Alternate Payment Sites
- This is a secondary batch that’s aside from your regular credit card processor
- These companies have their own fees
- Typically these are used for off-site types of transactions or online gift card merchants that intend to get you more sales
Online Gifting Sites
- Customers buy a product or service for someone, which is then redeemed at your location
- It’s important to note in these scenarios, that the “gifting” company will take any applicable fees out of the originally purchased sum and pay you the remaining amount at a later date
Considerations
- What impact will this service have on your overall business plan or marketing objectives?
- Will this company help drive your brand recognition to your target markets?
- Do the fees align with your budgeted advertising expenses?
- What effect will this influx in revenues have on your Top-line sales, Bottom Line Profits, and more importantly what will it do to your cash position?
- Check out Restaurant Deal & Delivery Cash Flow that discusses the math behind these deals as well as cover any other considerations when weighing if one of these services is right for your restaurant.
