Regardless of whether you are investing in three-sided food delivery marketplaces, a restaurant finder app, or just a simple food ordering app, you are on the right track.
In the US alone, revenue in the Online Food Delivery segment is projected to reach more than $28m in 2021. At the same time, the percentage of customers who place online orders has seen a triple-fold increase between 2015 and 2020.
Let that sink in. If you had invested in a mobile solution in 2015, you would have expanded your customer base by three times now. Let alone the revenue growth you could have enjoyed with a tripled customer base. This is the power of mobility and this is your missed opportunity to win in the hunger games.
However, you can still hop on the online ordering bandwagon and boost your restaurant business in a cost-effective manner. This article will dwell on the benefits of having your own food ordering app over collaborating with third-party services. We will also unravel the must-have features for your future mobile solution to make it stand out in the ocean of other apps.
Without further ado, let’s get right into it.
What Is Wrong With Third-Party Food Delivery Providers
Although managed food delivery services seem like a tempting alternative, the devil is actually in the details. Over the last few years, there has been general frustration with third-party food delivery providers for a great number of reasons. Let us enumerate some of them:
• High Commissions
Although taking off delivery fleet and infrastructure burdens, delivery services like UberEats are far from free, or even affordable for some restaurants. Thus, marketplaces usually charge a huge commission fee of 15-30% on each order, not to mention activation fees. In an already slim-margined niche with gale forces like labor and food costs, most restaurant owners struggle to make both ends meet.
• Thin Margin
Although it seems perfectly logical to increase prices to make up for high commissions, restaurants have their hands tied. The catch here is that food delivery providers have stringent pricing policies that oblige eateries to have the same prices on the menu and on the listing. As a result, restaurants lose income just because they partner with external delivery services.
• Quality Of Food
The monstrous delivery fee does not guarantee that your loyal customers get hot and tasty-looking food. Orders can become cold and soggy while they are waiting to be picked up by the delivery. There have also been complaints when couriers tasted the orders.
• Lack Of Customer Loyalty
Third-party delivery apps like UberEats have a loyal customer base. While you reap benefits by reaching a bigger audience, the chances are low that those foodies will follow your brand. Further, customers do not interact directly with your hospitable staff which also robs you of some bonus points.
Now, let's set in-house restaurant apps against third-party food delivery services.
Third-Party Or In-House Food Delivery: Comparison
So, let's find out what benefits and pitfalls you can come across if you invest in a restaurant ordering app.
Costs
As we’ve mentioned before, third-party food delivery providers often charge hefty commission fees. If you own a restaurant startup or a small-sized eatery, these fees may not be feasible, even considering the infrastructure it brings you.
On the contrary, you invest money in a mobile solution just once, while also obtaining a scalable sales channel that boosts your revenue.
Responsibilities
When you lean on third-party food ordering platforms, your responsibilities come down to a few activities like uploading meals, updating prices, and managing orders. At the same time, external marketplaces negate the need of handling marketing, technical support, and delivery issues.
However, if you choose to go your own way, you’ll have far more responsibilities. Thus, in order to ensure timely delivery, you’ll need to pay for delivery cars or pay your couriers to use their cars as well as track gas use and cover the insurance costs.
Also, you take over courier training and dedicated delivery prep staff. You also become responsible for managing customer service and customer feedback.
Fan Base
If your eatery already boasts a community of avid customers, they will migrate with you to third-party food ordering services. However, if you are just building up a dedicated customer base, external delivery providers usually presuppose a poor acquisition rate.
Since external apps serve as a middleman between your restaurant and customers, users tend to forget the restaurant’s name once they get the order.
On the other hand, if you extend your customer base via a tailor-made solution, you lay a great basis for dedicated community and brand awareness. In this case, you own all of the customer data which will help you perform targeted marketing and messaging campaigns and offer customer loyalty or rewards programs.
Long-Term Perspectives
Third-party food delivery services do not bode well for restaurant owners, since they don’t account for any business growth. The only thing you get is an increased number of orders that grows right in proportion with commission fees. As a result, you end up at a standstill with no profit increase.
Building a restaurant app for ordering food can cost you a pretty penny. But, you can turn into a positive already during the first year of the app's launch, and then, your income will grow at an arithmetic rate.
You can also take the place of UberEats and Deliveroo and offer your services to other restaurant owners. However, consider lowering a commission rate from 30% to 5% or 10% to make listing products affordable.
Must-Have Features To Integrate Into Your Restaurant Mobile App
As we’ve already mentioned, on-demand food applications revolve around three types of users, hence you need to build three different apps with custom functionality, plus a web-based admin panel.
First, let’s see what features you should include to win over the customers.
Custom App
According to restaurant mobile app developers, the following features bring the maximum value to your customers:
• Login. Allow the users to have an immediate login through social media accounts.
• Profile. This section should include basic personal information required for a successful delivery.
• Search. Enable customers to quickly find their favorite meals by including a set of filters.
• Order Section. Once the meal has been chosen, users proceed to this section.
• Multiple Payment Methods. Provide the best customer experience by including various purchasing methods for customers’ additional benefits.
• Live Tracking. The app sends the courier’s location to the end-user at a consistently high frequency, so that the user knows the exact delivery time.
• Push Notifications. The app sends users short messages, updating them on the latest changes and promos.
Restaurant App
Here is a must-have set of functionality for the restaurant side:
• Menu Management - This feature helps restaurant owners curate and manage the restaurant menu.
• Order Management - Eateries can manage the incoming orders, by streamlining order taking.
• Live-Chat - If restaurants need to specify any order details, they can interact with the customer directly via this feature.
• Delivery Requests - Eateries can turn on the order delivery once the meal is ready and send a request to couriers.
Courier App
To ensure successful and timely delivery, power the courier application with the following features:
• Delivery Requests Management. If the courier is available, he can accept the order and see the order details.
• GPS Navigation. The app lays out the most efficient delivery routes for couriers.
• Online Delivery Tracking. The app updates the courier's whereabouts and sends the data to the customer.
As for the web-based admin panel, it should include a dashboard, user management, as well as order and category management to ensure a seamless experience for all sides of the marketplace.
Now that we’ve got to grips with the essential functionality let’s guestimate how much an average food ordering app costs.
Building A Restaurant App: The Costs
The cost of developing a food ordering app varies based on various components, including the complexity of the functionality, design, and features. As for the approximate timeline, the development timeframe usually stems from the number of mobile app developers included in the process. Thus, an off-shelf restaurant mobile app development with basic functionality requires significantly less time than a tailor-made restaurant management solution.
According to mobile app developers, a standard application in this category will cost you around $35k to $100k per app. If you want to launch mobile apps for both platforms, the total project cost will double.
The Final Word On Restaurant Apps
Technology plays a pivotal role in changing our daily life and online food delivery attests to that. Adding online food delivery to your service creates a completely new line of sales much needed in today’s dire times. By investing in your own on-demand solution, you can maximize your ROI, boost your online presence and reach new customers.
