Our panelists shared their thoughts on questions left by the audience during EAT THINK DRINK 11: Open for Business – The New Normal for Restaurants about their thoughts on third-party delivery apps.
What are your thoughts on third-party delivery apps – with 30-40% in fees to the restaurant and consumer, are they a detriment to the industry / your business or are they necessary in times like this?
Lee Anne Wong, Executive Chef, Papa‘aina at the Pioneer Inn
I think while these companies are approaching businesses currently under the guise of an ally (“we would like to partner with you during this difficult time…”, “we understand how tough things are right now…”) it’s always good to read the fine print and at the end of the day whatever they are promising you now won’t make up for the dollars they will take from you later. Predatory still, just with a better marketing strategy. The best thing the community can do to support a restaurant is contact the business directly, order directly, and spend your dollars directly.
Kevin Hanney, Chef/Owner, 12th Ave Grill
Overall, they’re a mixed bag. If your dining room is filled to capacity, then the 30% replaces what you’re paying for rent and FOH labor, but who is filled to capacity these days? It still is too high a percentage and some of them mark up the online pricing on top of that! That makes the restaurant look bad. With companies like Elite coming in and charging a fair and transparent amount for delivery, that’s what is needed. In the panic that we all felt with the first shut down and the scramble for delivery capacity, I signed up for all of them. This time around will be a different story.
Henry Yoon, Founding Partner, DB Restaurant Group
There is a low-hanging fruit solution that our local politicians can easily adopt: Capping delivery fees during the pandemic. Other major US cities are capping delivery fees 15-20% in LA and NYC, respectively, and even extending the capped fee beyond the length of emergency orders. Delivery and other logistics remain a challenge for all of us within this industry—do we use 3rd party delivery or develop our own delivery system? 3rd party works when we’re working at full capacity—because it became a choice for us (we’d rather have our guests enjoy a fabulous meal within our dining room). In this dystopian dining environment, delivery is a must. Restauranteurs are entrepreneurs who will always figure out a way to solve a problem—we’re seeing it now as restaurants are offering free delivery pretty much anywhere on the island above a minimum purchase price or working with our regulars and VIPs creating fixed time drops for meal kits. This would be an easy win for our respective City Councils on the isles—a small gesture that means a lot to our industry.
Dylan Ching, Vice President of Operations, TS Restaurants
I think delivery is something you must have as an option. As we move forward using companies like Elite that has a far more fair model it’s a win-win. They are not on the outer islands yet so there is opportunity for someone to diversify. I also think finding out ways to do your own delivery in a small radius is a great option. The food stays hot and you can keep your percentage while finding more job opportunities for your people. There are added liabilities and cost, but when it comes to our product we handle and care for it much better than a third party. We have already started this in Kauai delivering to Wilcox hospital, car dealerships, and schools. You can have pre order items and times so you can consolidate your delivers. For now, we have one third party as an option, but we find that in our location’s curbside, online, and walk up orders do much better.