Foodservice Updates is designed to help foodservice operators keep on top of all the industry news and provides tips for keeping business running smooth. We endeavor to provide the latest tips and solutions to keep you in the know.
Delivering in the black
Are you among the many operators trying to figure out how to make delivery profitable? At a time when off-premise sales account for 38 percent of restaurant sales, according to Technomic, delivery has become a must for restaurants, even when the margins aren’t necessarily making the service profitable for those brands. Fortunately, new models are beginning to make the numbers work out. Recent Technomic forecasts have predicted that “subscription models that eliminate per-delivery fees in favor of a flat-rate subscription will emerge to present a clearer value proposition to customers.” The Spoon reports that a number of third-party delivery providers have come up with palatable offers for restaurants and consumers alike: DoorDash’s DashPass offers a monthly subscription of $9.99 for delivery of orders priced $15 or higher from a selection of restaurants, and Postmates has a similar offer. In the UK, Deliveroo is offering a £7.99 per month subscription for orders of any amount, and Uber Eats is reported to be testing a loyalty program that could eliminate delivery fees — if the experiment works there, it is likely to make its way across the pond eventually. Even operators who aren’t opting for subscription models are finding ways to make delivery profitable. In fact, delivery may be helping Chipotle make a comeback. Skift Table reports that delivery sales climbed 13 times in the fourth quarter of 2018 as compared to the same quarter of the previous year. Chipotle’s CFO credits a couple of factors for the success: the creation of a separate, digital food assembly line for off-premise orders, which enables the restaurant to process a greater number of orders, as well as a delivery-friendly menu (burritos and taco bowls are good travelers).
So long, Restaurant Week
Does your restaurant have creative ways of sharing what you do best — whether it be inventing new dishes or surprising guests with unexpected pairings or presentations? For years, operators have used Restaurant Week offers to bring guests in during slow periods, attract people who wouldn’t normally visit and test new menu ideas — but the event needs some reinvention. While it can be profitable for operators, many say that Restaurant Week turns off regular clientele, can be costly to manage and has grown to include so many restaurants that it is difficult to stand out in the crowd. In place of Restaurant Week, operators are coming up with more experimental concepts. Upserve reports that “Off Menu Week,” a joint effort between Resy and Capital One, is taking off in six food-focused cities ranging from Los Angeles to Chicago to New York. Participating restaurants will serve dishes that may appear on a future restaurant menu, off-menu items, or one-hit wonders that didn’t make it to the menu. Bloomberg reports that participating restaurants could offer such experiences as having guests try a dish with a selection of wines designed to draw out different flavors, or demonstrating different approaches to making sushi. The goal isn’t about showcasing signature dishes or trying to attract guests looking for a good deal — it’s about providing a behind-the-scenes experience visitors will remember.
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