Food delivery services have become a symbol of convenience for consumers, as they allow them to order food online and enjoy it from the comfort of their own homes. Gone are those days when consumers need to rush to restaurants to satiate their hunger. Now this has become a matter of a few clicks.
Undoubtedly, food delivery services are beneficial for consumers from every perspective as they are fast, convenient, and simple. Considering the restaurant’s point of view, online food aggregators help them maintain a balanced revenue flow and increase exposure in multiple markets. The idea of mutual benefits has made the concept popular. However, the delivery cost of a third-party delivery platform is still a matter of concern for many restaurant owners due to the hidden cost of food delivery services. In this article, you will learn about the hidden cost of food delivery services, why it is better to have your delivery system, and more. Let us first take a look at some facts about the food delivery market.
Food delivery market facts
The global online food delivery market is growing at a lightning speed, and it is expected to touch $505.50 billion by 2030. This figure shows how important it is for restaurants to adopt delivery services. This can be done either by relying on third-party delivery platforms or by creating their system.
To know the advantages and disadvantages of having an in-house delivery system or using a third-party platform, you can go through our previous blog on Third-party Vs In-house online ordering system.
Now, let us discover the way the food delivery service works.
How does the food delivery service work?
Online food delivery platforms act as a bridge between customers and restaurants. The whole process takes place through an online platform. Customers place online orders through an app or website, which informs the restaurant and alerts the delivery person.
Third-party food delivery platforms are not only expensive but also restrict direct communication between customers and restaurants. Get a clear idea about the hidden cost of delivery services in our next segment.
The European food delivery market is mostly dominated by a few players, which include Uber Eats, Lieferando, Wolt, Glovo, etc. You might be surprised to know that a major part of the total food delivery transactions across the continent come from them. The price markups are usually set based on the country and restaurant. However, consumers often pay 10 to 25% more for online delivery than dine-in prices. Sometimes, grocery delivery giants like Uber Eats and Deliveroo charge up to 74% more than supermarket prices for doorstep deliveries.
Here is a quick look at the pricing structures of these popular delivery platforms for restaurants in Europe:
- Commission fee: Online delivery platforms typically charge a commission of between 15% and 35% per order, depending on the country and its policies.
- Delivery fee: The delivery fee is generally borne by the customers, which ranges between €2 to €5. These charges may go up during rush hours.
- Service or Platform fee: An additional amount of €1–€3 on average is imposed on restaurants, termed as a small order fee or service fee.
- Setup or Onboarding fee: Delivery platforms may also take a one-time setup fee for listing a restaurant or activating delivery services.
The combined charges make the food expensive when they are ordered through a third-party delivery platform.
Why do you need your online delivery system?
Having an in-house delivery system or creating your delivery app is a beneficial step for every restaurant.
Besides saving a huge amount of the hidden cost of food delivery services, building an in-house food delivery system offers many other benefits that are mentioned below:
- An in-house food delivery system allows you to directly interact with your brand through your website by placing orders, sharing feedback, and more.
- The entire control of the delivery process and system will be in the hands of the restaurant owner.
- It also increases brand exposure and helps restaurants create loyal customers.
- With a dedicated food delivery system, you can create a centralized platform on your website through which you can manage orders, deliveries, and food menu.
- Improve user experience with clear communication, delivery status updates, scope for sharing feedback, etc.
- A boost in profit levels as restaurant owners do not need to pay a commission fee.
- Full control over food pricing, as there is no dependence on third-party delivery services.
So it is evident that removing dependence on food aggregators brings multiple benefits to your restaurant business. To have your food delivery system, you need the right software. FoodMato can be your ultimate partner in fulfilling your restaurant’s digitization needs. Let us find out how FoodMato helps you in this journey.
How does FoodMato help?
FoodMato is restaurant management software that turns your ordinary restaurant website into a centralized platform for all your restaurant operations. Starting from menu management, to online orders and delivery, it covers everything to empower your brand digitally. The best part is that it is designed especially for non-tech-savvy people, as the FoodMato team handles the entire process with friendly support. This means from building your website, branding, adding a menu, online orders, and delivery to marketing, the entire technical process will be taken care of by the team.
Moreover, it offers integrations with popular food aggregators like Uber Eats, Liferando, and Wolt, which help you manage all your orders through your website. Their pricing package is also affordable and makes it easy for restaurants of all sizes to use their services. To get the details of their prices, please contact the team.
Wrapping up
To conclude, we could say that the hidden cost of delivery services often eats up the lion’s share of profit from restaurant owners. Now that you have a clear idea of their costing and how it is affecting your growth, you must build your food delivery system with the help of FoodMato. The small step can increase your profit, brand exposure, improve user experience, and communication with your customers.
Take charge of your restaurant’s success. Say goodbye to hidden costs — say hello to Foodmato.
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