Introduction:
Ever since food delivery services have come into the spotlight, people are shifting away from the dining-out trend.
Can’t confirm whether it has helped your restaurant or not, but some companies have benefited a lot.
The change in people’s interest has prompted a rise in revenue and growth for restaurant aggregators or food delivery apps like DoorDash, Grubhub, and UberEats.
After all, they were already prepared for this revolution!
With robust marketing, a digitalized presence, and a giant customer network, delivery services like DoorDash are monopolizing the whole industry. But it happened so quickly in recent years.
Given the sudden lockdown due to the global pandemic of 2019–2022, U.S. food-delivery apps saw a humongous rise of $3 billion collectively, as per SEC listings.
To ensure the continuity of their business, restaurants had left no alternative than to get in touch and have their brand listed on their food delivery platforms.
This resulted in the disappearance of most restaurant brands. It is like losing an identity.
If your concern has prompted you to consider the best alternative to DoorDash and other delivery service providers, this article is for you.
- What is the best alternative to food delivery services like DoorDash?
- Why should you think about a change?
- How is the alternative going to help you in the future?
Read on to grab some of the most exciting information on food delivery services and your restaurant.
What is the business model of DoorDash, GrubHub, and UberEats?
The food delivery industry has grown so large that there are now multiple options on the market rather than just one.
But only a few are popular.
The mainstream companies are DoorDash, Grubhub, and UberEats. All these three companies are almost ruling the online food delivery industry. But the interesting thing is the business model of these three.
What makes Uber Eats and other delivery services so popular among restaurants? In response to this question, let’s become more familiar with these platforms first.
- Business Overview of DoorDash
DoorDash is an American online food ordering company available in multiple cities across the United States and Canada. Company’s business model is quite straightforward.
It is basically a tech firm that connects people with their desired restaurant in the city. The company caters to the dynamic requirements of eaters through its locally built logistic ecosystems.
Apart from the US and Canada, the company even has operations in Australia, Japan, and Germany, running similar business models and scaling.
The main sources of income for the company are commissions from restaurants, delivery fees, subscriptions, corporate catering, and revenue from subsidiaries.
Surprisingly, the company started it all in 2013 and achieved so much within the first nine years of its operation in the industry.
- A Business Overview of Grubhub
Delivery services like Grubhub are also popular in the U.S. Started in 2004, the company has earned the status of being the best food delivery service provider after its recent progression.
The company’s takeout services are popular among customers. Customers simply download the Grubhub app on their smartphone and search for the best restaurant near them to eat food at.
If we talk about revenue sources, they are basically built into delivery charges, Grubhub’s commission fees, promotions, and its subscription model, Grubhub+.
The entire business model of the restaurant operates through its mobile app, which people download to their smartphones in the hope that it will aid in fast order execution.
- A Business Overview of Uber Eats
Uber Eats is one of the subsidiaries of Uber, a San Francisco-based tech firm with a diversified business model. The business model of food delivery services like Uber Eats is also similar to that of most other restaurant aggregators.
The platform connects people with local restaurants; similarly, food delivery service to the customer’s mentioned address is also provided by the company. The main revenue streams for Uber Eats are commissions on orders, promotions, delivery fees, and so on.
One thing that is quite common among all these companies is that the maximum credit for the food delivery service is retained by these restaurant aggregators. A restaurant hardly gets any sort of recognition.
Reasons Why Restaurants Are Relying So Much on Food Delivery Apps
Despite how expensive or unfair a third-party delivery service provider or restaurant aggregator is, most restaurants are still relying too much on these applications, but why? Take a look at the following reasons, which speak for themselves.
- Shifting the customer’s preferences
Ever since the internet of things has gained momentum, businesses are riding the tech-enabled vehicle. Especially after the rise of e-commerce, people have developed a new habit of purchasing more items online rather than offline.
There are a plethora of emotional and physical reasons as well, which have contributed to a growth in the consumption of food delivery services. Given that, restaurant operators are also transitioning to these applications.
Most restaurants are running their businesses through restaurant aggregators like DoorDash, GrubHub, and Uber Eats. It is because of a false belief that almost every customer who loves ordering food online can be found on these platforms alone. But that’s not a universal truth.
- Managing the Expectations of the Customer
It is assumed that managing customers’ expectations is easier for delivery companies than for restaurants themselves. The main business model of these restaurant aggregators is to connect people with local restaurants through a “delivery only” business model.
Restaurants believe that these delivery companies facilitate speedy product delivery to customers’ doors. However, they might be providing a great delivery service to customers.
But there’s no guarantee whether they are genuinely meeting customers’ expectations or are simply pretending to look good. In the end, their ultimate goal is to make delivery of the product as soon as possible.
- Operating in a Competitive Market
The competition in the food industry is skyrocketing. Each new day, a new challenge germinates in the competitive market of restaurants. Restaurants are heavily relying on food delivery apps to get ahead of the competition and enjoy long-term business growth.
Well, marketing efforts made on a large scale and the well-established digital appearance of these applications are the chief reasons drawing restaurants’ attention.
But we believe that less confidence in ourselves is the chief reason here. People believe that no matter how hard they try, they will still struggle to beat their competitor, who has already invested so much in their business and brand promotion. But that’s not true.
- Applications are expensive.
Another leading reason that leaves no option for restaurant operators other than opting for delivery services like DoorDash is the concern that “applications are expensive.”
But that concern is also right to some extent. A restaurant application with basic features can be a $10,000–$20,000 investment. If more features are added, charges can readily go up to $40,000, respectively.
In the end, shaking hands with the third-party food delivery service providers appears to be the only option. But it isn’t a necessary condition at all. If your application is too expensive, don’t turn to DoorDash, Uber Eats, or Grubhub for assistance. You have alternatives too.
- Inexperience in Technology
Inexperience is one of the misconceptions that keeps most restaurants back, despite the fact that their recipes carry vast potential to rule people’s hearts on their own. Still, they believe in taking help from third-party delivery service providers.
They aren’t yet well-versed in tech knowledge, or they may be living under the false assumption that technology is the work of engineers and developers. That’s why partnering with the third-party restaurant aggregator isn’t a bad decision for them.
Still, they explore alternatives to these aggregators as they start introducing the dark side of these third-party restaurant applications and food delivery service providers. In such cases, you had no choice but to use Transition.
This topic will be thoroughly discussed in the discussion that follows.
Reasons Why You Should Think About Alternatives
Let’s get right to the reasons why you should consider alternatives or other delivery services like DoorDash and not place too many expectations on them.
- Partner’s Revenue
The earning sources of food delivery applications are diverse. The brand behind these apps—e.g., DoorDash, Uber Eats, and Grubhub—generates income by simplifying the delivery process for restaurants.
In return for this service, they receive a fixed commission. In most cases, the commission is set by the brand or agreed upon by both parties.
But you might be already aware that the commission isn’t the only revenue source for these partners. Especially if you are a restaurant operator delivering your food to customers via these aggregators, you might have noticed additional charges attached to their services.
Here’s a breakdown of the revenue sources of these aggregators, which are a source of concern for restaurant owners:
- Commission on Food Orders: The chief reason impacting profitability
- Delivery charges: a barrier for customers willing to place an order
- Convenience charges are an unwanted charge paid by customers and restaurants both.
However, commission rates vary from one food delivery service provider to another. But there’s no way to avoid these three charges.
- Delivery Problems
Besides partners’ revenue, delivery problems are also quite common. No matter how hard a restaurant works to improve its managerial activities and operational efficiency, delivery issues continue to plague the service provider.
However, delivery service providers stress more on making their services as fast as possible. As such, they are using GPS technology to track the location of each of its delivery guys. Therefore, not everyone, but some, can still assist you in the fast delivery of orders.
But it can even mess up the whole scene. For example, if your restaurant’s protocol states that food should not be shaken too much, there’s no guarantee a delivery boy will follow it unless they’ve been given special orders from their managers.
- Effect on Food Quality
If your restaurant has customers who only buy from you because the quality of your food is excellent, your anxiety must skyrocket. Assume that the hotness and crispiness of the food last for no more than one hour. It must be delivered within 1 hour, otherwise it begins to soften and become cold.
If customers who were used to eating this food from your restaurant are receiving their order after 1 hour, all negative reviews will go into your basket, and the food delivery company will be free from all allegations.
Even if a customer does not leave negative feedback or a negative review, he or she may simply switch to another restaurant near their home.
This is where you are likely to lose more customers who may have intended to order from you but were swayed by a negative review.
- Brand’s Disappearance
When you serve customers through delivery companies like DoorDash, Grubhub, and Uber Eats, the most interaction happens between customers and these third-party aggregators alone.
This results in the hampering of your brand because it is no longer visible to customers. Customers will keep chanting one name—the food delivery company—which doesn’t give them a sense of the specialization of your restaurant.
Simply put, at any hour of the day, if a food item isn’t available at your restaurant, rather than saying sorry to customers, an aggregator platform may recommend other restaurants providing similar cuisine.
When a customer makes the recommended choice, there is a 50% chance that they will return to your restaurant or simply forget about it and move on. It depends more on the service of other restaurants, which must not be too good compared to yours.
- No Loyal Customers
Your business may yearn for loyal customers if more than 50% of your restaurant’s orders are coming through a third-party application and not through your own platform.
You can’t entertain your customers, you can’t celebrate their continuity with your business, and you can’t reward them. After all, all contact details will be available to the application owner and its marketing team.
Simultaneously, your old customer will be treated as if they were a new customer. There is no growth scope; you will only have a functional opportunity to enjoy short-term growth. You can’t remarket your products and offerings because you don’t have a loyal customer base.
The Best Alternative to DoorDash, GrubHub, and Uber Eats
Now that you are well aware of how it feels when you work with a third-party food delivery service provider, it’s time to change.
That partnership might have been eating up your business for a long time now.
But it is still not too late. You can switch to online food ordering systems if you believe those applications are not worth your time in any way. As a result, App2Food, one of the most popular free online food ordering systems of the age, can help you start or restart your online food ordering business.
Over the past few years, App2Food has been creating a history of surpassing close rivals in food delivery services like DoorDash, GrubHub, and Uber Eats.
The platform, however, is not a direct competitor to all of these platforms; rather, it creates a substitute that is more sustainable, effective, and affordable.
Online ordering systems replace the need for a private application or an aggregator’s platform. You will have your own restaurant application, and that’s also without pouring in extensive investment capital.
For a small monthly charge, you will get the advantage of customizing an online order system like your own application. You even have access to marketing support and tons of other great benefits, as discussed below.
Advantages of Using App2Food
DoorDash and other delivery services are undoubtedly working pretty well from their perspective. They are supporting all big and small restaurants equally through their giant audience network.
But if you want to grow locally and want to make a strong impression on customers so that they only remember you and not others, invest in your private source.
Don’t worry, it won’t cost you thousands of dollars but just a monthly fee, and that’s it. Simply start using App2Food and enjoy the benefits as given below:
Innovative Platform
App2Food is an innovative platform wherein restaurant operators and startups with limited kitchen space can come and create their own application from scratch. The application works like any other food delivery app; the only difference is that you will be in charge of it and not someone else.
However, maintenance and other web developer tasks are managed by App2Food. However, remaining tasks such as menu creation and updating are handled by the executive or any other managerial party of the online ordering system.
Your application will be active 24 hours a day, seven days a week, and will be providing an app-like experience that might cost you over $8000 to $25,000 or more, but is almost free with App2Food.
Benefit through marketing
You can also gain access to a unique restaurant marketing advantage that no other third-party application can offer. Simply put, App2Food provides support to its partners through SMS marketing and email marketing.
Over 60% of B2B companies recognize the value and effectiveness of both marketing tools. Email marketing is quite helpful at turning an unknown user into a well-known customer.
It lets you convey your message, market, and re-market your brand to a broad audience without being too personal or disturbing someone.
SMS marketing is one of the best techniques for building relationships with customers and providing them with a sense of trust towards your business.
Customizable
You can build your own menu, customize the layout as per your specifications, and even add your brand’s logo to your digital portfolio for a more personalized touch. You will access the complete branding benefit that’s also included without paying extra.
However, the remaining treasure will be unveiled only once after you become an App2Food member.
Affordable
Online ordering systems like App2Food are far more affordable than all of the great options suggested by others. For a small monthly charge, you can access complete marketing benefits, business support, and a complete suite of customizable features.
No additional fee is charged. However, it’s just a teaser of what you get. There’s much more covered in the App2Food basket for aspiring restaurants intending to do something big with a limited budget.
Run loyalty programs
Third-party delivery service providers or restaurant aggregator applications are the leading players. Partnered restaurants are working in the backend. Since no branding benefit is served, all contact details are secured by these applications—loyalty programs don’t make sense.
But with an online food ordering system like App2Food, you will not just access branding benefits but will also benefit from loyal customers. Since customers’ contact details will be received exclusively by you, you can reward them and retain them in your business by running a restaurant loyalty program.
App2Food itself helps you determine what your program should look like and what benefits to accept. But still, we recommend coming with good preparation.
Choosing Your Food Delivery Model Before Shifting
There’s nothing wrong with selecting food delivery services like DoorDash, because it is wrong when you stop exploration. As far as possible, you should tap into new opportunities and take a risk to try some new alternatives. Perhaps it makes you more profitable than before.
But before shifting to alternatives, make sure you are fully sure of your delivery business model so that the good start does not transform into a bad ending.
Here’s a list of food delivery models where online food delivery ordering systems work like magic.
- Platform To Customers
If you own a small kitchen with no dine-in facility (similar to a takeout restaurant), you should go with App2Food.
- Restaurant to Customers
If you own a restaurant with dine-in facilities combined with food delivery services
- Online Table Booking
If you accept table reservations at your restaurant through online applications only
- Hyper-Local Food Delivery
If you run a hyperlocal food delivery business that provides almost every facility to customers
In all the above-stated business models, App2Food will work like a pro for you. So what are you waiting for? Make a wise move today!
Conclusion
Now that you have finally found delivery services like DoorDash GrubHub, or Uber Eats, it’s time for a transition. Gear up, because you have a long way to go to make your business sustainable and affordably more profitable.