Restaurants have become exceptionally reliant on third-party restaurant delivery services because it's easy. You can use an app that handles the entire delivery process and don't need to hire someone to handle the delivery for you.

For a plug-and-play experience, it doesn't get much easier to deliver food than using a platform that already has all of the logistics in place for you.

But, as with most things in business, if you use a third-party service, you're also giving up much of your control and will need to pay fees and commissions. Unfortunately, these commissions will either need to be paid in one of two ways:

  1. You'll need to charge customers more for the food
  2. You'll reduce your profit margins

If you're new to restaurant food delivery, we'll explain what 3rd party delivery platforms are and how they can negatively impact your business' finances.

delivery food apps

What are 3rd Party Delivery Services?

A third-party delivery service can be any non in-house delivery that you need to pay to handle deliveries. You likely know the names of the leading options for these types of deliveries:

  • GrubHub
  • DoorDash
  • UberEats
  • Etc.

And, all of their offers are very attractive. You can instantly start offering delivery and can be added to their portals, which provides exceptional marketing in the process.

Since more people are eating in and ordering delivery, you might need to offer delivery to remain competitive in your area. Over the long-term, there's always the risk that being a restaurant that delivers is bad for business if the third-party services aren't up to customer standards.

How Food Delivery Platforms are Negatively Impacting Restaurants

What can go wrong with offering delivery in your restaurant? Consumer demand for delivery is at an all-time high, but relying on food delivery platforms also has its downsides. You'll need to weigh the positives and negatives of using 3rd party delivery to better understand if it's a good choice for your eatery.

Order Handling Gets Out of Control

Walk into many restaurants, and you'll find that someone is waiting at the counter for an order. Often, delivery drivers are lined up on busy days waiting to pick up food to deliver to customers.

But, due to each delivery platform having a different way of handling orders and sending drivers out, it's easy for things to get out of control.

Not only can orders get out of control, but it's easy for:

  • The kitchen staff to become overwhelmed
  • Orders to be mixed up
  • Orders to be missing items

If your staff is new or not trained properly, it's easy for one or two orders to be wrong. And, once an order is wrong or missing an item, it leads to negative reviews and lost trust from customers.

Orders can also get out of hand to the point of:

  • Food being delivered late
  • Orders being delivered cold

Handling orders in-house makes it easier to train staff and have a reliable way to deliver food to your customers without fear that orders will arrive cold or wrong.

Transaction Fees Eat Into Profits

You're at the mercy of delivery services when you use their service because they can charge as much as 30% commission on a single order. If you sell an item for $20, that means that you're only receiving $14 in revenue.

Restaurants are already running on tight profit margins, and many items you sell may not have the markup to make the fees worthwhile.

How do many restaurants deal with these fees:

  • Charge customers more, which pushes many customers away in the long-term because your prices are simply too high.
  • Demand higher minimum orders and reduce the number of sales you'll make.

If you control all of the delivery in-house, you can budget for driver costs and find ways to reduce expenses. But when you use 3rd party platforms, you're at the mercy of the fees and commissions that they charge.

Loss of Data Control

A delivery restaurant can ask customers for mobile numbers and email addresses. You can fill your CRM with crucial buyer data and remain confident that the customer is engaging with your brand directly.

You lose a lot of your data control when using third-party services, which can impact future sales.

But, there's another issue that is arguably far more important than what has already been discussed.

restaurant food delivery

Customer Experience is Linked to 3rd Party Delivery Food Apps

You're relying on another party to uphold the service and commitment that you offer customers. You can't control:

  • Drivers who deliver late
  • Poor service from the third-party
  • Etc.

If you offer delivery and issues arise that are the provider's fault and not your own, guess what? Customers will leave you a bad review and your reputation will be impacted because of something out of your control.

Customer experience is what causes repeat customers to continue coming into your restaurant and one bad delivery can severe the loyalty that you built up.

Unfortunately, many of these apps use automated systems and lack the support systems to meet the high demands of your loyal customers.

What Restaurants Can Do to Rely Less on Third-Party Platforms

Third-party delivery platforms are riddled with problems, but they're also a convenient option for restaurant owners. What can you do to rely less on these providers and start taking control and ownership of your own delivery?

  • Create your own online ordering system: You can use ready-coded solutions or hire someone to create your ordering system. These systems work perfectly when you have in-house delivery services.
  • Switch to in-house delivery: You'll need to "train" customers to start using your delivery service, and it will take time before they do. But if you switch to in-house delivery, it gives you 100% control.

If you're concerned about in-house deliveries, work with a consultant who can put all of the systems and procedures in place to streamline your delivery service.

Reducing your reliance on 3rd-party delivery platforms is never a bad option as your restaurant grows. You can hire more local workers and regain control over costs and customer experience.