The delivery dilemma: outsourcing vs. in-house

Picture this: you’ve finally launched your own restaurant which has been getting a lot of positive reviews about the food and service from a sensible amount of loyal customers. At the same time, you’ve also been receiving plenty of feedback about your restaurant’s location being a little too hard to access because of its lack of parking spots.

So, you decide that this is the best time to implement a delivery service for your restaurant in order to extend your reach to customers from all parts of town. You get on Google and suddenly you realize it isn’t as easy as you thought it would be. Browsing through a myriad of names in the market is enough to make your head spin.

Now, there are two ways you can do this: you could make this work via a third party delivery service company, or you could get one integrated with your PoS (point of sale).

You may be familiar with some of the following delivery service company names: UberEATS, GrubHub, Deliveroo, and DoorDash. Or if you’re from Southeast Asia, names like Food Panda, Oddle, and Grab Food would most likely ring a bell. These are your third party delivery service companies a.k.a. saviours of the hungry and hopeless.

Outsourcing: Advantages

Many restaurants opt to partner with a third party delivery service because it takes a lot of burden off their shoulders. There is no match against its convenience. If you really think about it, you’ve got your marketing and advertising covered when your restaurant appears on their website or app, all orders are placed on their platform and sent over to you, and they take care of the delivery.

More importantly, you get to save on hiring your own delivery guy as well as delivery vehicles that are equipped with proper food storages that could prevent spillage or contamination. You basically get the whole package.

Outsourcing: Disadvantages

While free advertising of your restaurant on another platform sounds like a great idea, it could actually turn out to be a double edged sword because it puts your restaurant into direct competition with other eateries. And although people may choose to order food from you, at the end of the day, these clients do not belong to you, but the delivery company that you’ve partnered with.

And remember the part about saving cost on a delivery guy and vehicle? Having a third party delivery personnel only means you do not have control over him — so whether or not he decides to deliver your guacamole two hours late, is completely out of your control. So, there is an obvious risk for your brand’s reputation in the future. In fact, there will always be risks when you entrust your brand’s reputation with someone who isn’t part of your organization.

The fees that come with outsourcing is also a mega dealbreaker for many business owners. While you may notice an increase in sales due to higher brand discovery, it may not necessarily be manifested in your total sales at the end of the month because of all the third-party commissions.

For that reason, many have decided to ditch outsourcing for in-house delivery. There exists softwares such as Mobi2Go, ChowNow, and Upserve that offer mobile and online ordering solutions that can be integrated into your business’ PoS system.

What these softwares do is that it gives businesses the opportunity to kick-start their own in-house delivery service by providing them with the necessary tools to get started.

In-house: Advantages  

Information. Information. Information. The one thing third party services cannot deliver (no pun intended). Unlike third party delivery services, all orders made from the client’s end goes directly into your system. While this is happening, all their information is stored into your PoS system — allowing businesses to build a database which makes it easier to study their consumers for the purpose of customer retention strategies and more. This is where a loyalty program comes in handy

Customization is also a major advantage in softwares of such. The ordering system can be easily embedded into your website, and is versatile enough to be customized in order to match the look and feel of a specific brand. This promotes brand consistency across all platforms, leaving a lasting impression on your customers.

And because everything flows directly into your system and operated in-house, you get to reduce the chances of miscommunication when it comes to taking orders, promotions, and more.

On top of not needing to pay third-party commissions, most of these softwares are also relatively cheaper compared to third-party delivery services, and come with several pricing plans to suit various budgets. 

The best part? You’re in charge. Everyone reports to you.

In-house: Disadvantages

But being in charge also means if anything goes wrong, you’ll have to deal with it — even if it isn’t your doing. Think angry customers raging about how their minestrone soup has spilled out of its packaging. Take it from Uncle Ben of Spiderman, “With great power comes great responsibilities.”

And although this solution may be cheaper compared to partnering with a third-party delivery service, don’t forget that you’ve got to allocate funds to hire your own delivery personnel and purchase the appropriate vehicles for transportation of the food.

Needless to say both have their own sets of pros and cons, and you can never win. It is however, important to pay attention to shifting trends as well as what consumers are demanding for, and learn to adapt to it. At the end of the day, setting your restaurant up for success should be your key focus.

Denissa Goh is a Public Relations and Content Manager for Eber, based in Kuala Lumpur. The former journalist and flight attendant is an ESFJ personality type who has a keen eye for luxury fashion and enjoys intelligent conversations. Apart from being a gym rat who often counts her daily calorie intake, she cannot resist great coffee and whisky. Besides being an article churning machine, she also functions as that annoying office colleague who types really loudly on her keyboard because of her long acrylic fingernails. You can reach Denissa at denissa@eber.co.

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