UberEats and food delivery apps are killing restaurants and this is how
In this modern era, everything is becoming simpler day by day. Something new is coming up and it brings about an impact in the industry. It happens that time and again you may be tired from either work or another activity, and when you get home even the thought of just getting in the kitchen to cook sickens you and it's too late to go to a restaurant. This is where many people just through scrolling their smartphones can order food from their favorite restaurant but through food delivery apps such as UberEats, Foodora, JustEat and GrubHub. In a matter of a few minutes the food is delivered and there you go!
But what is really behind these food delivery apps? What contracts and deals go behind that simple app so that you can get food delivered? What do the restaurant owners feel about it? Well, UberEats , foodora, justEat and GrubHub does not operate for free. In a slow manner, they are kind of affecting the restaurant industry and this is how:
There are some stiff charges which restaurants have to commit to, in each and every order which a restaurant prepares so that it can be delivered to customers. UberEats takes 35%, GrubHub charges 15% whereas JustEat takes 13% of the price of any order that goes through the delivery apps. To that local restaurant that you happen to know, this percentage is very high even the top high-class restaurants can admit that this stretches the profits.
The percentage charges are so tough that some restaurants have to be very keen on what they should include on their UberEats,foodora, JustEat and GrubHub menus. They have to choose something which is affordable to them. Some restaurants prefer having the cheap meals there rather than putting their whole restaurant menu on the food delivery apps, which may have some pricey meals. But when you take a deeper look at the restaurants that have invested all their meals in these apps especially UberEats which has the highest percentage cut, it is not profitable to them. After the 35 % percent cut, it becomes a loss to the restaurant. It has come to the point that some restaurants cannot take it anymore but negotiate on that percentage cut so that it can be decreased.
In addition to that, restaurants take a hit from food delivery apps when some of their loyal customers decide to distant themselves. When there is something wrong with an order, the customer will not blame UberEats,Foodora, JustEat or GrubHub the fault will be directed to the restaurant. Here is how one of these food delivery apps delivers a blow to restaurants. Since UberEats has been trying to reduce the time which is taken to deliver an order some changes were done. Faster deliveries means that the delivery radius is reduced and some of the loyal customers who are coincidentally very busy to go to a restaurant are locked out of the delivery radius. When they order something, they get an 'out of range' message and notification. This gets the restaurants in trouble because customers are always blowing up the customer care phone with complains although it is not the restaurant's fault.
In addition to that, since the online food delivery platform such as UberEats,Foodora,JustEat and GrubHub have grown, it becomes harder to cater for the physical in-house customers because of the large online orders. A budgeted menu on the food deliver apps by the restaurant also makes it worse. When the restaurant has half its menu on these apps some meals which customers love to eat will not be included. What happens if a customer scrolls through the app and does not find the meal he/she likes? Of course, there is always an option to anything, and in a situation like this anybody can do whatever they can to get the meal he/she loves.
Getting digital or any kind of marketing from such apps is kind of costly. Even if a restaurant or any food from a specific restaurant is featured on UberEats, Foodora, JustEat and GrubHub in the end too much money will be spent. In addition to that, not much profits will be noted which is kind of frustrating. When you do the math and come up with the monthly cost of being in such an app you'll not be shocked to find it that the profits are split maybe lesser than before.
This is really impacting restaurants but some have to put up with such Food delivery apps as to keep the customers. It may not be that comfortable to work with such apps but change cannot be escaped.