All I’m implying is gross less grubhub costs less other variable costs doesn’t leave a lot left.
Agreed. Absolutely awful time for the industry.
In your example, we don’t know what optional marketing tools the restaurant was choosing to spend the money on (e.g. Free Delivery, Higher SEO). I don’t like GrubHub, but from my recollection, their pricing model is:
- Commssion: ~15% (20% for this restaurant)
- Marketing Fee: ~10%
- Processing Fee: 3-4%
Total: ~25-28%
Everything else is probably add-on, opt-in services. I am not making the argument that combined service fees should be 25%, but that is the industry standard right now.
Sorry, I just snapped back because there has been a good amount of pushback from restaurant operators against these third-party delivery platforms. Culprits that come to mind: Zach Pollack & David Chang.
Pollack was posting on IG something along the lines of “We asked delivery service to lower their standard fee and they said no!” It came off like he thinks the delivery services owe him something. I don’t recall the content exactly, but it left a bad taste in my mouth.
Without restaurants there would be nothing to delivery.
Restaurants typically spend 60-70% of what they bring in on labor and food costs. That leaves ~35% for the rest. Rent, utilities, upkeep, all the costs that go into running a restaurant everyday…
Now you’re paying out ~20% to these services that send untrained drivers with no food safety knowledge requirements, brush as many fees as they can off on restaurants so consumers see as low a price as possible and also tell restaurants they can’t raise prices through their platforms to recoup any of the costs associated with those fees. Among a million other things.
It’s Silicon Valley. All the delivery services care about is getting people used to expecting delivery and service through these apps. What does the average person care about the costs of running a restaurant?
Theres a reason so many cities have passed or are working to pass laws capping their fees during this time.
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El Abajeno is open for takeout! Praise God.
I was looking at the Ronan menu. Has anyone had their salads to go, or the chicken or the sourdough boule or the cultured butter?
You might enjoy reading about OLO’s Dispatch product.
They are turning the tables on delivery service providers.
I was looking for a recent article that explained everything clearly and concisely, but this was the closest I could get:
Essentially, the restaurant secures the delivery order then puts the actual job of delivering the food up to bid to companies like Uber Eats, DoorDash, Postmates, GrubHub, etc.
The end user pays the delivery fee–same as they would if ordering direct through Uber Eats, et al.
Restaurant pays OLO service fees, but nothing to Uber Eats, et al.
Really interesting restaurant industry-related software solution that is a shining example of that magic Silicon Valley word: disruptive.
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I had to take a few passes to really understand the business model:
So it basically taps into the 3rd party providers to access their delivery drivers ONLY, and does not use any of the app stuff, ie you wouldn’t go to a grubhub app to place an order. It sounds like the savings is any potential marketing fee/etc that grubhub/doordash/etc would charge, given that Olo also charges a fee for their services.
But it also then sounds like you would need some type of other POS system to integrate with Olo, ie ChowNow, or else how would people actually place online orders?
Man this restaurant business is intense.
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Interesting concept. Almost like adding a second middleman to the equation. An overseer of the delivery services. So between the guest and the restaurant there’s Olo and then whichever delivery driver/service picks up the call.
Very much like how bike messengers operate.
I like this sentence from the link @Ns1 provided:
“Using Dispatch allows you to craft the best user experience and, most importantly, own the relationship with your customers.”
I can’t speak to the user experience, but it is incredibly important to acknowledge that the restaurant deserves to be in charge.
The mainstream delivery services treat restaurants like a middleman who works for them. They want to warp people so they truly think their food comes from UberEats/Grubhub/Seamless/Caviar/Postmates, rather than from Chefs and their teams.
I’m interested to see how toast handles this transition to delivery, seeing as how they are in a ton of restaurants already. Same with Tock (founded by Nick Kokonas) helping restaurants adapt to offering ToGo. It’s great to see companies enter this space that already have an interest in keeping restaurants successful.
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Tock is offering the Chinois Experience for $39, which gets you all the following:
- Soup of the day
- Chinois chicken salad
- Vegetable spring rolls (lettuce wrap, mustard and spicy sweet and sour sauce) [2]
- Chicken pot stickers with ginger soy [3]
- Stir-fried egg noodles with vegetables
-Vegetable Fried Rice
And
Choice of: Shanghai lobster with curry sauce or Slow braised short ribs with potatoes and vegetables. I went for the lobster.
The Shanghai lobster provides half a lobster but, alas, no flash-fried spinach. Since the lobster comes with its own rice (the better to mop up the curry sauce), the vegetable fried rice was superfluous so I saved it for lunch the next day. Everything was individually packaged and was delicious and more than ample.
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Ultimately, all of these service providers are trying to draw blood from a stone. As @Ns1 noted, margins are so slim for restaurants as is. There is no leprechaun and pot of gold waiting at the other end of the rainbow. It is just clawing over bits. It was already like this. The current pandemic has just sped up the process and brought it into focus.
I am in agreement with some that there will be a need to be a seachange. There is no more juice left to squeeze. Customers are going to need to pay more or restaurants will not be able to survive. That will mean fewer restaurants. That will mean less eating out for a large part of the population. The restaurant industry is in for a big recession.
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Ronan - West Hollywood
Hubby’s test was postponed. 
More study time! But no Cut by Spago, but we did have expensive Pizza delivered.
Doctor’s Orders for Two - Slane Whiskey, Averna, Mezcal, Ginger, Lemon & Honey
Tart, Sweet, Smokey, Boozy, Reasonably Priced $17 for 2.
Lettuces, Herbs, Fennel, Pickled Fresno Chilis, Cucumber Vinaigrette & Creamy Garlicky Dressing
I broke my rule of no fragile, dark, greens from a restaurant, but I wanted a salad and the photo looked good. It was a little wilty from the travel, but still really good, nice touch w/the 2 dressings - the fresh acidity of the vinaigrette & the creamy dressing complimented each other.
Marinara - “Too Much Sauce”, Garlic, Oregano, ‘Nduja
This usually comes w/anchovies, but we ordered it w/‘nduja. The funny description said “too much sauce” but we thought it was the perfect amount. I only had a nibble of the ‘njuda for research - it was in chunks but spreadable, spicy, flavorful, too salty, but when I picked mine off it left a nice, spicy, salty, oily sheen of flavor on top of the cheese. 
The crust has a slight sourdough tang. But I don’t think I’m really a Neapolitan Pizza gal 
and I thought this was a bit doughy & chewy even after crisping in the toaster oven. Hubby liked it more.
The Phillipe - French Dip Calzone w/Thin Sliced Beef, Provolone (?), French Onion Soup, Hot Mustard
Always trust your instincts. I ordered this because it looked good and reviews are positive. But I don’t really like calzones and that is too much char for me. The beef & cheese was very tasty together but the sauce had a sweetness to it I didn’t like.
Wood-fired Cheesecake & Quince
So creamy, custard-y, tart, mild sweet & salty, delicious!
This is a thoughtful & clever way of handling the delivery app dilemma (their only form of delivery btw). They’re very nice over the phone. I would definitely order again, but choose something else on the menu… I wish they still made the Marinated Anchovy dish @PorkyBelly.
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I’ve been thinking about Iki. Will do!
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That’s funny - I’m almost ordered last night from Ronan the same salad you had and a pizza, but never got around to it and just made my own dinner. Would you order the salad again? Now I’m also doubtful about the pizza based on your report.
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Yah, I saw you mentioned wanting to get their salad and made sure to report about it. You’re very discerning so I hesitate to recommend. 
I really liked the actual salad ingredients and dressings and the greens were far from bad but could’ve been fresher. I think our mistake was ordering delivery on a Friday night during a restaurant lockdown.
I am not the person whose advice you should take on Pizza. I get that big, chewy, blistery, charred lips is the sign of a true Neapolitan Pizza, but I’m not feeling it as much as others and haven’t had a lot to compare. Pizzeria Mozza (which I love) doesn’t count because it’s not exactly the equivalent. I did note that Ronan’s dough is pretty sourdough forward. 
And we did like the fresh sauce a lot. @Chowseeker1999 @Nemroz @lapizzamaven and others can do a better job explaining how Ronan’s Pizza stacks up to others. I’m curious too.
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Sorry to hear that the salad wasn’t that great. Doesn’t sound like you would go out of your way to order it again. Back in the day, I used to get salads delivered from Sotto (where the chef from Ronan came from) and the salads were always amazing, even with delivery, so I was hoping it might be the same.
Maybe I will stick with Kiriko this weekend. Last weekend I picked up some sushi and it came with a salad that I wasn’t in the mood for, so I threw it in the fridge and I was shocked when I pulled it out the following day – a day later, even pre-dressed, it was quite good. Nothing to complain about with that salad and that was just a throwaway salad that came with the sushi.
No I wouldn’t. But like I said it may have been the timing. It was a busy Friday night and the poor deliverer seemed very harried. Also, I’m weird about restaurant salads from the git-go, so.
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Hi @TheCookie,
Thanks for the report back. 
Yah, the words “doughy and chewy” doesn’t sound very appetizing to me, either. 
Thanks for taking one for the team.
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