Developing one’s own restaurant delivery app has become popular among restaurant owners. But why create your own restaurant food delivery app with Uber Eats, Grubhub, and DoorDash in the market?
The number one reason is that with a third-party food ordering app, the commission can be as high as 25–30% (for Uber Eats). DoorDash charges 10–25%, while Grubhub takes 5–15%. This is why many restaurants choose to make a food delivery app and set up an in-house delivery team rather than pay a third party.
The number two reason is the absence of third-party delivery options. Even if a restaurant owner is ready to work with big players like Uber Eats, they may not provide service in the area.
The number three reason is that third-party delivery companies are often overloaded with orders, causing delays. Thus, customers can become dissatisfied and restaurants can start losing regular guests.
To satisfy customers, keep up with competitors, improve delivery speed, and ensure customer loyalty, restaurant owners choose to develop their own food delivery services. Check out the statistics below to learn how quickly online delivery is becoming one of the growing forces in the restaurant industry.
In this blog post, we’ll catch you up on all the latest types of online food delivery apps for restaurants. We’ll shed light on branded and third-party platforms. Moreover, we’ll give you tips on must-have features for a restaurant ordering application.
These are three options for restaurants that offer delivery and want to do so through a mobile app.
A restaurant can develop their own branded mobile app. A restaurant ordering app generally includes options for delivery and pickup/carry out.
There are three main reasons for creating a branded food delivery app for restaurants:
- High demand. As GloriaFood states, 86% of consumers in the US use delivery services at least once a month. Online taxi ordering, car rentals, and hotel bookings are way less popular.
- Wide customer base. Your potential customers are anyone with a mobile phone and a craving for pizza, wings, burgers, Mexican, Thai, Chinese, etc.
- More revenue. According to Nation’s Restaurant News, orders placed via a mobile restaurant ordering system are an average of $4 higher compared to those placed in restaurants.
- With an independent platform, restaurants can save the 15% to 30% commission that food ordering and delivery companies charge.
On the one hand, by entrusting delivery operations to an in-house team, you have greater control over the quality of food delivered and the delivery speed.
On the other hand, food delivery app development requires investment and technical expertise. We’re here to assist you with the technical part. We’re here to assist you with the technical part. We’ve addressed the cost of building a restaurant app in a previous article.
Jimmy John’s, a popular sandwich chain, has their own in-house delivery team to provide the best customer service.
Jimmy John’s cares not only about the quality of food but also about the speed of delivery, which is why they deliver by bike. It’s generally not as fast as by car, but it cuts delivery times when traffic is heavy, making delivery times more predictable. If orders don’t arrive in 40 minutes, customers are encouraged to call the restaurant. Delayed orders come with free stuff — or even entirely for free.
The delivery fee varies depending on a customer’s location and is included in the total cost.
Domino’s also has its own online restaurant delivery service, and customers can use the Domino’s mobile app to place orders.
The Domino’s chain has let customers track the pizza delivery process for some time. Now, it also allows customers to track their deliveries with GPS. The tracker shows a little car moving on a map till it gets to the customer’s house.
Also, Domino’s is about to use self-driving delivery vehicles. In 2017, Domino’s worked with Ford to test basic customer interactions with the service. Now, they’re making use of the automated driving tech startup Nuro. Domino’s customers in Houston can already place orders and wait for a fully autonomous electric vehicle to arrive.
For details, check out the video below.
The second option is for a restaurant to work with a third-party delivery company.
There are three main reasons for choosing a third-party delivery platform:
- Convenience of outsourcing logistics
- Access to a potentially larger customer pool and increased sales
- Lower costs, as there’s no need for setting up and maintaining a delivery team
When considering a third-party platform, keep in mind that there are two food delivery business models. One is the aggregator model. When you partner with an aggregator, it connects customers to your restaurant. Customers place orders via the aggregator platform and restaurants view those orders and fulfill them. Delivery is not handled by the aggregator.
On the other hand, there are platforms with logistics support. When you partner with this type of platform, customers place an order on the platform. Then you accept the order and fulfill it while the platform sends a delivery partner to pick up the order and bring it to the customer.
The present-day market leaders in this segment are:
- DoorDash. This app is available in 1,200 cities and includes 110,000 restaurants. It’s not big, but it offers unique features. The DoorDash Delight scoring system is one of them. DoorDash recommends the best restaurants by popularity, quality of food, customer satisfaction, etc. DoorDash partners with The Cheesecake Factory, Chipotle, Subway, and Chick-fil-A.
- Uber Eats. The Uber Eats app covers 1,000+ cities and connects hundreds of restaurants. Its homepage is easy to navigate, and users can simply scroll through options or search for a particular restaurant or cuisine. Buffalo Wild Wings works with Uber Eats.
- Grubhub. This web commerce platform helps users find and order restaurant food. It connects around 125,000 restaurants in 2,400 US cities. Upon entering their location, customers see restaurants in the area. They can then choose by menu items or cuisine. To speed up the ordering process, users can also save delivery locations. Grubhub is the official delivery partner for Yum! Brands (Pizza Hut, Taco Bell, KFC). Not so long ago, due to the purchase of LevelUp, Grubhub also got permission to create white-label platforms under a restaurant’s own name.
But on the flip side, there are drawbacks to using third-party delivery services that you can’t ignore.
- Third-party delivery platforms take a substantial cut of each sale:
|Platform||Commission to restaurants |
(% of total check)
|PlatformUber Eats||Commission to restaurants (% of total check)25–30%|
|PlatformDoorDash||Commission to restaurants (% of total check)10–25%|
|PlatformGrubhub||Commission to restaurants (% of total check)5–15%|
|Source: mKonnekt – Commission charged by third-party delivery platforms|
2. Delivery platforms pool their trips, affecting delivery times.
3. Packaging and food quality can suffer with these services.
4. Lack of direct engagement between customers and restaurants leads to a decline in brand loyalty.
5. Restaurants lose control of the overall customer experience.
Restaurants can combine their own app with the services of a third-party company. This fusion is called a hybrid platform.
Here’s how it works: First, you entrust a food delivery app development company with the creation of your app. Your in-house manager monitors orders placed via the app, and a third-party company is hired to deliver them.
There are three main reasons for creating a hybrid platform:
- You can focus on making hassle-free transactions.
- Though a hybrid platform requires some upfront investment in technology, in the long term, your delivery costs will be lower.
- You can stay in touch with your customers via your app, increasing brand loyalty.
By using a hybrid restaurant ordering solution, you can smooth out most of the negative aspects of cooperation with a third-party delivery company. But poor packaging remains a threat. To minimize risks, consider using special packaging. Lamb Weston’s Crispy on Delivery fry cup is a good example. Its innovative design prevents a build-up of moisture, preserving crispiness.
Panera Bread is a delivery pioneer. To access new customers, in 2014 they implemented a hybrid platform — their own branded app with delivery provided by a third-party service. The chain requires that third-party delivery companies be fully integrated into the Panera system.
Panera Bread has declined to disclose the terms of its contracts. But according to strategy officer Dan Weigel, the chain’s hybrid approach has allowed them to continue meeting market demand.
Now Panera Bread customers can place lunch and dinner orders via the branded app. Online orders may be fulfilled by Grubhub, DoorDash, or Uber Eats. All orders placed via phone as well as some online orders are fulfilled by Panera Bread’s own drivers.
This approach protects the brand from quality concerns, as their food presentation demands and delivery times are met.
The Panera Bread example has been followed by Carrabba’s Italian Grill and Outback Steakhouse. These two Bloomin’ Brands chains have chosen DoorDash as their third-party service.
If you want to know what other innovative online ordering systems for business you can use in your restaurant, check out our blog post on this topic.
Once you decide to build a food delivery app, your next step is to decide on the features it should have. The customer-focused app or interface of a food delivery service should offer these basic features:
A sign-up page: a simple, efficient, and attractive sign-up page is important for winning a customer’s loyalty. Your sign-up page should let a user create a new account using a login/password or sign up via a third-party service such as Facebook or Google for added convenience.
A profile/account page: once a customer has created a new account in an online ordering system, they should be able to access their profile. This profile can include saved payment options for easy access, an order history along with the ability to reorder, and the ability to save favorite restaurants/menu items.
Restaurant search/locator: in either list or map format, a restaurant locator shows which restaurants customers can order from using the app. Some sort of search functionality (by distance, time, or cuisine) is necessary to help users filter through choices. Details of each restaurant, such as its location, menu offerings (ideally, with pictures), prices, special offers or promotions, and comments or user reviews should be easily accessible.
Order placement: once a customer has compared restaurants and made their choice, they should be able to easily and quickly place their order through the online ordering system. Customers should be able to add or delete items from orders if necessary, and an order summary should be presented before the customer completes payment so they can make last-minute changes. Being able to specify a delivery time (as soon as possible or at a specific time) could be a great additional feature.
Payment processing: being able to pay for an order through online ordering software is ideal. Payment processing should be fast and secure, and your app should allow for multiple payment options (coupons, credit cards, cash upon delivery, PayPal, Apple Pay/Android Pay, etc.).
A basic food delivery app should include all of these features. Some additional nice-to-have features include:
Notifications or real-time tracking: keeping customers informed of their order’s status (placed, being prepared, on its way) through notifications or a real-time tracker is a great additional feature.
Social media integrations: letting users link their social media accounts to share photos of their food is an easy way to boost loyalty while increasing the exposure of both your restaurant and app.
A loyalty or rewards program: offering users rewards (either through the app or through a particular restaurant) is another great way to boost loyalty. For example, offering free delivery on every fifth order will encourage users to come back to your app or order from the same place. Incorporating other discounts, membership options, and referral programs can encourage users to keep using your app. You can even entice users to get their friends to join by rewarding them for their loyalty as brand ambassadors.
The goal of a food delivery app is to attract new users and retain old ones. It’s important to make it easy for users to compare offers from various restaurants, place orders, pay, and receive their food. Providing additional features or rewards is an easy way to boost loyalty to a particular app, service, or restaurant.
The app or interface aimed at restaurants should include the following features:
A registration page: this page should allow restaurants to create accounts that include their business details (name, address, hours of operation, etc.).
Content management functionality: provide a simple interface that allows restaurants to manage their menus, including images, pricing, ingredients (especially for people with allergies/food intolerances), promotions, and any other important information about what they offer. This page should allow for easy editing so restaurants can update their info as needed.
Order management/tracking: restaurant staff should be able to see incoming orders and update order statuses. Tracking where orders are in the preparation process is important. Real-time updates for canceled orders, completed orders, and orders out for delivery is also an important part of this feature.
Cross-interface communication capabilities: being able to update the courier/delivery person as well as the customer on the order status is necessary for both aggregators and new types of delivery apps. Cross-interface communication is about notifying the customer or courier that an order is ready for pick-up or is on its way.
The goal of this app is to efficiently pass order information from the customer to the restaurant. Restaurants should be able to manage orders in a way that fits their prep process, and deliveries should be completed either by the restaurant itself or by a courier or delivery driver from the app.
The app or interface aimed at couriers or delivery drivers should include the following basic features:
A sign-up page: provide a way to register for an account using a simple login/password or other form of authentication.
Order status and pickup/dropoff management: show a list of available orders and details of each order (size, expected delivery time, additional information, etc.), along with pick-up and drop-off locations. Having real-time order tracking statuses (placed, accepted, in process, rejected, cancelled, etc.) is important as well. Statuses can be quickly communicated via push notifications or similar services. Couriers should be able to sort through available orders, filtering by relevant details (distance, time, etc.), and should be able to easily book a delivery they want to complete. This booking feature should update the app in real time so that other couriers know that an order has been claimed.
Cross-interface communication capabilities: the ability to be updated and to update the consumer and restaurant in real time about the status of an order is critical to a delivery driver. Once they’ve claimed a delivery through the booking feature, they should be able to update an order’s status to let the restaurant know they are on the way to pick it up or let the consumer know they are on the way to drop it off.
Additional improvements to a courier-focused app or interface might include:
Account history: being able to view completed deliveries and make notes about customers/restaurants could be handy for drivers, letting them flag difficult deliveries for future reference.
Loyalty or rewards program: including a rewards or referral program could boost courier loyalty. Providing drivers with bonuses or rewarding them for referring their friends to order through the app or become drivers themselves is a great way to ensure brand loyalty while increasing brand exposure.
Given the rapidly increasing use of tablets and smartphones at the global level, developing a mobile ordering app is a great local business strategy.
If you’re thinking of developing a food delivery app, make sure to consider every aspect of it and take the needs of customers into account. If you’re unsure of where to start or need advice and resources when it comes to on demand food delivery app development, read more about our expertise in building software solutions for restaurant owners. Upon reading, contact us to learn the details. Our team of experts will be happy to help!