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How to optimize your delivery and take-out operations
The demand for delivery has skyrocketed as a result of the coronavirus outbreak that has seen restaurant dining rooms forced to close, but the costs associated with converting your operation from a dine-in model to a delivery or takeout model can be great.
From setting up drive-thrus to preparing margarita to-go kits, restaurants are finding new ways to keep business alive during unprecedented times, and customers are doing what they can to support them.
“The sense of community has been astounding,” Jhon Goodwin, co-owner of Lost Boys Garage, said. “It’s been truly wonderful.”
Goodwin said customer service is more important than ever in an age where shelter in place and public health can dissuade people from eating out. He said he would advise operators to instill the importance of customer service.
“Make sure your people are doing their absolute best to give a smiling, thankful service at this point,” Goodwin said. “Everyone who pulls up has to be thanked for supporting us. We’ve come to the level where customer service is everything and food has to be top-notch and survive the ride home.”
Don’t overlook family value
Jeremy Tangen, owner of Borracho Taco & Tequileria has seen the demand for delivery and takeout dramatically increase since the coronavirus outbreak hit Spokane. In response, he has adjusted his menu, keeping in minds the foods that carry well and the foods popular for delivery. He had his prep staff change over and start creating more family-style meals that offer more portions.
“The menu may stay the same, but it’s adjusted from the high prep, high cost to the regular menu items done in family styles,” Tangen said. “It’s one-stop: You can get something you can feed the family with and it’s a better value for pricing.”
Even for just two or fewer people, Tangen noted, there’s value in going for the bigger order, creating leftovers and mitigating consumer anxiety over insufficient portioning.
Earn liquid profits
Tangen said to-go alcohol sales have had a much higher profit margin than his food sales, commending the Washington State Liquor and Cannabis Board for taking “quick action” in allowing restaurants to sell alcohol to-go.
“While we’re not making a good margin on the meals, we’re seeing a lot of people who see that they can pick up beer to go, they see we can do margaritas … those add-ons really make up the margin,” Tangen said. “It’s really competitive out there … being able to offer that extra item or product at the point of sale has been the thing that allows (us to compete).”
“I was very impressed with … the way (the liquor and cannabis board) had rolled it out and had made it fairly simple and understandable from a licensee’s point of view,” Tangen said. “I do also support them simplifying it even more and allowing it to be something that we can mix our cocktails and beverages to go.”
Be prepared for the learning curve
Goodwin said one of the larger challenges he has encountered in acclimating his staff to a more quick-service, drive-thru routine was that it calls upon a different skill set.
“I’ve noticed significantly is that it’s a very different skill set that a full-service server or bartender is used to doing versus a drive-thru,” Goodwin said. “It’s funny how it takes a different type of thinking for your servers to expedite to-go food, not tableside. It’s harder to notice details like missing a ketchup.”
Goodwin said his team organized a quick training routine and noted that it’s been “fun” getting a handle on it.
“We had luckily worked out our to-go (previously) because we use fresh-cut, never-frozen fries, we had to figure out how to put that into a to-go box,” Goodwin said. “So we ended up with a particular type of to-go box, we put the fries in a chunk of foil, that’s been trial and error over the last few years.”
Consider local options for delivery
Olga Sagan, owner of Piroshky Bakery in Seattle, felt like she was losing control of everything – her website, her customers – to third party delivery platforms.
“The problem with the third party is they’re not liable for anything,” Sagan said. “The liability is still entirely on you as a business owner and that’s the worst part. We gave all our power away, all our money away, all our product away and we’re sitting here wondering why.”
Sagan determined that she was going to take her power back, by creating a resource for restaurants to compile their websites and guide users there called Catch 22 Delivery.
Customers visiting Catch 22 are then able to find and be funneled to the websites of local eateries in their area. The goal is to get customers back in the habit of ordering directly from restaurant websites, rather than going through third-party delivery and possibly becoming distant from your brand.
“if you have a pick-up option or delivery option, you submit an inquiry form and we add you to our database,” Sagan said. “Even if you don’t have a website, we can put you in our database and when we have the ability we can put your name and phone number out there .”
The platform is in its infancy, but it is a collaboration of restaurant owners, Sagan said, and they want to bring on as many owners as they can. There’s no cost to sign up, and there’s no geographic limit – anyone in the state, or the nation, can register and have their website be available to find.
Even closer to home, local options may provide vital cost-savings in the short-term. Goodwin spoke highly of local Spokane delivery company, Treehouse Deliveries, which he said offers a similar service to larger third-party brands (which his business also is partnered with) but provides a far cheaper rate and the value of being a local business partner.
Don’t rush in
As dire and ambiguous as the coronavirus outbreak has been, there may be a pressure to try and rapidly convert your operation into something aligned with takeout and delivery. Tangen warns that anyone considering making changes and investing in this new model should consider the long-term costs and rewards.
“If somebody is looking to get into it, I would highly recommend that they weight the labor costs versus what they are actually going to be getting back in revenue … and customer satisfaction, because if this is something new,” Tangen said. “It’s an opportunity, but at the same time it’s going to be something that can be a massive headache, cost and disenfranchise customers from going back if they don’t do it right. Is it worth it to take that chance?”
Borracho had some advantages at the outset of this outbreak – the Mexican restaurant was already equipped for delivery and takeout and had invested the cost and time into making that work for them. The Lost Boys Garage location had in a former life featured a drive-thru, and still had the physical drive-thru facilities intact. When the pandemic struck, Goodwin took down the boards and converted it to functional use.
Lacking advantages like these, the costs of conversion at this stage may just outweigh any potential profit, Tangen warns.
“We’re inherently optimistic, we want to take care of staff, but going into something that’s brand new and trying to build it in a business that’s only going to be here for a few weeks or months,” Tangen said. “Owners are desperate to do whatever they can. But a lot of them, I don’t hear them saying they are looking at food costs, labor costs – just because we’re in desperate times doesn’t mean you should throw all the other stuff out the window. If it doesn’t make sense, I wouldn’t recommend doing it.”