Report: restaurants having to adapt

Restaurants uncertain about the future are looking for new ways to thrive, according to a new report conducted by YouGov.

Restaurants uncertain about the future are seeking new ways to thrive, with more than four in five (82 per cent) restaurant owners who stayed open during the COVID-19 lockdowns adopting new ways of working; including new processes, systems, or technology, according to the inaugural Deliveroo HospoVitality Index Report.

Deliveroo’s report was conducted with research firm YouGov, which surveyed more than 500 restaurant owners across Australia to understand business confidence, the challenges they face, how they’ve responded to the COVID-19 pandemic, what government policy initiatives will help aid recovery and their plans for the future.

In exploring how restaurants navigated the national lockdowns, the Report reveals 48% of restaurant owners introduced new staffing and shift patterns, 42% optimised their menus and a quarter (25 per cent) made point of sale changes.

Nine in ten (91 per cent) of Australia’s restaurants stayed open and operating in some capacity, with 74 per cent adopting new revenue streams such as takeaway, delivery, ready to cook meals, adding alcohol options to food orders and hampers.

Of the restaurants that introduced new ways of making money during the COVID-19 lockdowns, 90% said they would maintain some or all of these revenue streams into the future, with takeaway (57%) and food delivery via a platform such as Deliveroo (55%) the most popular.

Looking ahead, restaurant owners said technological advancements in digital ordering and in-store collection processes are the most needed (45 per cent), followed by improved data insights to manage marketing (20 per cent) and developments in advanced online bookings (18 per cent), showing the vital role platforms will have in supporting the restaurant sector.

Nearly four in ten (39 per cent) of restaurant owners are feeling positive about their business prospects today and 26 per cent are concerned (net balance +13), while 30 per cent are positive about their prospects in three months’ time and more than a third (36 per cent) are worried (-6 net balance).

One in five (21 per cent) of all restaurant owners said they didn’t know at what stage they would be able to trade profitably and be viable within the Federal Government’s 3-step Framework for a COVID-safe Australia, demonstrating just how vulnerable many businesses are feeling.

However, more than half (52 per cent) of restaurant owners are optimistic about their own business prospects in 12 months’ time and only 15 per cent are concerned (+37 net balance). This is compared to more negative sentiment towards the sector as a whole. Four in ten (39 per cent) of all restaurant owners surveyed are feeling positive about the future of the hospitality sector, compared with 30% who are feeling pessimistic, giving a lower net balance score of +9.

The greatest challenges impacting business confidence are, equally, the slowing down of the economy and reduced dine-in capacity (each 68 per cent), followed by a reduction in consumer spending (64 per cent) and produce prices increasing (60 per cent).

Government assistance during the pandemic has been vital, with two thirds (65 per cent) of restaurant owners accessing JobKeeper. Of these restaurants, 44 per cent said they would not have been able to keep trading had JobKeeper not been available, equal to those who said they would have.  Two thirds (66 per cent) of restaurant owners sought rental relief from their landlords during the COVID-19 lockdown.

Restaurant owners were also asked to rank the government policies they felt were most important in aiding their recovery. Tax relief was the overwhelming priority (79 per cent), followed by payroll tax (49 per cent) and penalty rates (43 per cent), while more than a quarter (29 per cent) are keen to see a relaxation of regulations for outdoor seating.

Home delivery disruptors cause grumblings among food service providers

Digital disruptors are damaging the restaurant industry by encouraging patrons to stay home and eating into profits, claims a report from Restaurants and Catering Australia (R&CA). Its 2019 annual Benchmarking Report, one of the areas of greatest concern indicated by restaurant, café and catering business owners was the negative impact of digital disruption.

R&CA’s CEO, Wes Lambert, said, “High streets are falling silent and neighbourhood restaurants are push to their limit as delivery services discourages bums on seats. There is only one winner between the platform and the restaurant, the platform wins due to the exorbitantly high fees charged and the restaurants lose as they see their profits decline even as their revenue increases.

“Some restaurants are finding themselves pushed to the brink of closing – a bad outcome for our social precincts, restaurants patrons and, ultimately, home delivery consumers. Others are ditching the platforms altogether,” said Lambert.

“Under the online delivery platforms, where under the ‘partner ‘model, the platform is profitable, and the restaurant is not. Restaurants have been forced into taking on an unwanted business partner they didn’t ask for and who takes a 35 per cent cut. At that rate, meals become unprofitable for the restaurant.

This year’s survey revealed ongoing and significant growth in penetration of online food delivery platforms – 53.8 per cent of restaurants surveyed use online delivery platforms.  That is more than triple the number (15.4 per cent) from the same survey in 2017.  In 2018, the percentage using delivery platforms was 31.2 per cent.

Of the restaurants surveyed, 46.2 per cent said they didn’t use delivery platforms, compared to 68.8 per cent in 2018 and 84.6 per cent in 2017.

When asked which delivery platforms they prefer, 26.2 per cent said UberEats, 22.3 per cent said Menulog, and 3.8 per cent said Deliveroo.  Of those surveyed, 32.3 per cent use combination of platforms and 7.7 per cent use all three delivery platforms.

More than 63 per cent said their primary reason for signing up to a delivery platform was to increase their customer base. Others (32.03 per cent) said they were forced to participate because their competitors were using these platforms.

Respondents overwhelmingly said that they had experienced an increase in revenue but a decrease in profit (53.9 per cent) and 32.8 per cent said they experienced an increase in revenue and profit and 13.3 per cent indicated no change.

More than half (55.5 per cent) said that fees associated with online food delivery were so high that it was impossible to make a profit using the platforms. Only a quarter of businesses (25 per cent) said that platforms provide a convenient service that allows restaurants to increase their revenue and 19.5 per cent indicated they encourage customers not to go out and buy directly from the business.

These answers indicate that more than 70 per cent of businesses surveyed believe that online food delivery is negatively impacting the hospitality industry.

Just over 50 per cent of businesses said they currently used an online booking provider within their business, down slightly from 55.6 per cent in 2018. This remained up from the 41.7 per cent identified in the 2017 survey.

The Fork was the number one response (36.4 per cent) when asked which online booking provider restaurants used. It was the online booking provider of choice among businesses surveyed.  Now book it was preferred by 17 per cent of respondents. Others (13.6 per cent) preferred other online booking providers (13.6 per cent).  While 10.2 per cent named Dimi as their favourite, 9.3 per cent preferred Quandoo 9.3 per cent, 7.6 per cent preferred Opentable, 4.2 per cent preferred Obee, and 1.7 percent said BookBook was their choice.

Online booking providers
Just over half (50.7 per cent) respondents said they used an online booking provider within their business, down slightly from (55.6 per cent) in 2018. This is still up from 41.7 per cent in 2017.  When asked which online booking provider they used, the top response (36.4 per cent) was The Fork.  This was followed by Now Book It (17 per cent), Dimmi (10.2 per cent), Quandoo (9.3 per cent) and Opentable (7.6 per cent).

Social and digital marketing channels
Lambert says, “This is the first year we asked businesses how they use social and digital marketing channels and the impact this has had on their businesses.  This is clearly an important tool for their businesses because a significant number (65.56 per cent) indicated that they spend money in this area.  Facebook was most popular with half of our respondents naming it as their most used marketing tool.”

Payment systems
An overwhelming number of businesses (92.3 per cent) indicated that card payment – either credit or debit card, was the most common payment method, followed by cash (2.56 per cent), then phone touch payment (0.9 per cent).

When asked about payment processing methods, the most common form of card payment was PayPass or Tap & Go, with 79.83 per cent indicating it was the method of choice for customers. This was followed by 12.88 per cent using PIN input, 2.2 per cent using smart phone payment, and 3.9 per cent use online payments (through booking platforms).

Watch out UberEats, Deliveroo and Menulog – DoorDash has arrived

DoorDash, the largest on-demand food platform for door-to-door delivery in the US, announced today its official launch in Australia, beginning with Melbourne. This marks the company’s first market expansion beyond North America.

Australia’s ‘foodie capital’ will be the first to experience the unparalleled convenience DoorDash will bring to the food market, with Melburnians benefitting from a greater selection of restaurants than ever before. Thousands of restaurants will be available for delivery through DoorDash – in addition to hundreds for pick up – across the CBD and inner suburbs, with plans to expand to the outer suburbs in the coming weeks.

DoorDash’s launch taps into Melbourne’s love of food and food delivery apps. At launch, customers can order from well-known brands such as Nando’s, Betty’s Burgers and Salsa’s Fresh Mex Grill, as well as local independent restaurants including misschu, Bay City Burrito and exclusive partners Cedar Bakery and Il Gusto.

Melbourne isn’t alone in its enthusiasm for on-demand access to food from favourite local restaurants, with the rest of the country continuing to embrace the ease and convenience of food delivery. In fact, almost two million Australians aged 14+ (9.8 per cent) use meal delivery services in an average three-month period.

“We are excited Australia is our first international expansion outside of North America,” says DoorDash general manager, Australia, Thomas Stephens.

“We dove deep into the Australian market and quickly realised two things; restaurants want more from their delivery partners, and not all Melburnians have access to the selection that they should expect.”

“We’ve built a lot of product and expertise to solve these problems in North America. Combining that experience with a tailored approach just for Melbourne, we’re excited to grow the market here. We’ve built a service for Australian eating habits with a simple focus: provide more access to Melburnian’s favourite foods,” Stephens said.

Along with a wide selection of Melbourne’s finest eateries, DoorDash offers a superior delivery experience plus a unique ‘pick-up’ function allowing users to collect their meals on the go in addition to ‘group ordering’ for big groups.

“Working collaboratively with restaurant owners of all business sizes, customers and Dashers, our priority is accessibility to a delightful food delivery experience for all. From Melbourne, we aim to continue our expansion efforts throughout Victoria and Australia through the remainder of 2019 and into 2020,” Stephens added.

Nando’s CEO, Craig Mason says, “Nando’s is a great choice when you’re wanting something tasty but not keen to cook. With over 80 restaurants across the city and outer suburbs, we’re excited to be partnering with DoorDash to offer our customers even more flexibility around how they enjoy their favourite meal.”

Bay City Burrito’s Owner and Chief Burrito Designer, Gary Mink says, “At Bay City Burrito, we pride ourselves on the quality of our ingredients, whether it is our locally-sourced produce or imported tortillas. It has been refreshing working with the team at DoorDash who have taken the time to understand my business and set me up for success on their platform to get incremental orders from both their delivery and pick-up product.”

Laura Huddle appointed head of commercial for Deliveroo Australia

Online food platform Deliveroo has appointed Laura Huddle as head of commercial in Australia.

Huddle joins Deliveroo after more than nine years at event technology platform, Eventbrite, where she joined as employee Number 20 and held multiple roles including head of sales and business development for Asia Pacific and head of marketing – Australia and New Zealand.

Huddle will oversee Deliveroo’s relationship with the more than 11,000 restaurants on the platform in Australia, as well as focus on growing the number of restaurants with whom Deliveroo partners. The appointment comes as Deliveroo continues to expand the restaurants on its platform, having more than doubled the number of partner restaurants in the past 12 months.

“This is an incredibly exciting time to be joining Deliveroo, a company that is focused on transforming the way people think about and experience their favourite foods. Partnering with and enabling the success of Australia’s best and most-loved restaurants is key to this,” said Huddle.

“There’s no doubt that the traditional restaurant sector is changing as consumers are looking for both the convenience of on-demand food delivery and an amazing dine-in experience. I’ll be focusing on ensuring that Deliveroo can best position our partner restaurants to succeed across both.”

During her time at Eventbrite, Huddle opened the Australia, New Zealand, Singapore, and Hong Kong  markets, drove experimentation within the small and medium business segment, and led APAC sales to achieve globe-leading performance.

How does Deliveroo impact on the Australian economy

Food company Deliveroo has  released new independent research into the company’s contribution to the Australian economy, revealing  economic benefits to the Australian restaurant sector.

The report, conducted by economic consultants Capital Economics, measured the impact of the economic activity generated by Deliveroo’s operations. The figures in the report are based on a combination of internal Deliveroo data, publicly available official statistics and a YouGov survey of partner restaurants conducted between the 13 December 2018 and 16 January 2019.

The report has found Deliveroo supported $452 million in revenue growth and $209 million in gross domestic product (GDP) in Australia and contributed to the creation of nearly 8,000 additional jobs in the restaurant sector. These jobs are in addition to the work Deliveroo creates for the 6,500 self-employed riders who choose to ride with Deliveroo, as well as an Australian office with 140 staff.

The report also found that during the 2017/2018 financial year Deliveroo’s Australian operations supported $61 million in employee tax revenue and $59 million in corporation tax revenue that has been paid in Australia. This is tax paid by Deliveroo’s direct employees, restaurant partners and their suppliers as a result of Deliveroo’s spending in Australia.

The report shows how Deliveroo helps restaurants to grow their businesses by enabling them to reach new customers they otherwise would not be able to. According to Capital Economics, Deliveroo has created an additional $313 million in revenue for its restaurant partners. Deliveroo currently partners with more than 10,000 restaurants across Australia and predicts this number will rise to 17,000 by the end of the year.

Based on current trends and growth in Australia, the report has projected Deliveroo could support more than somewhere in the region of 31,000 jobs and $696 million of economic output in Australia by 2020.

Globally, Deliveroo supported $5.2 billion in revenue and $2.3 billion in GDP across its markets, leading to 67,000 additional jobs, of which 59,000 are in the restaurant sectors of the markets in which Deliveroo operates.

“This research shows that, in addition to making it easier for Australians to access their favourite foods whenever and wherever they want, Deliveroo is making a significant contribution to the Australian economy, and this contribution is growing rapidly,” said Levi Aron, country manager for Deliveroo Australia.

“By providing restaurants who partner with us the opportunity to reach more customers, we are helping them to grow their revenue and hire more staff.

“This report underscores that not only is the on-demand economy providing more opportunities for flexible work and for businesses to reach customers in new ways, but it also has a sizeable and positive impact on Australia’s broader economic growth.”

The report comes one month after Deliveroo launched its game-changing subscription service Deliveroo Plus – the first subscription service for a food delivery platform in the market. The service, which costs $18.99 a month, saw 20,000 subscribers across Australia in its first week and is continuing to grow. In the past year Deliveroo also launched Marketplace+, a service that facilitates restaurants with their own delivery drivers signing up to Deliveroo, allowing them to deliver food through their own rider fleet or make use of the platform’s 6,500 riders across Australia, broadening these restaurants’ ability to offer delivery options.

Deliveroo is continuing to go from strength to strength in Australia. In 2018 the company experienced triple digit growth and has seen the number of restaurants on the platform increase by 150 per cent and the number of riders increase by 50 per cent over the past year.

Deliveroo partners with tech startup Doshii to improve ordering process

Deliveroo has announced a partnership with Melbourne-based Hospitality and Retail API Platform Doshii to streamline processing orders for restaurant partners, which will make the process of getting Australia’s favourite restaurant foods delivered to customers’ doors more seamless.

Restaurants who partner with Deliveroo will be able to utilise the Doshii API (Application Programing Interface) to connect customer ordering direct to their in-store point-of-sale (POS), eliminating the need for restaurants to manually process orders that come through the Deliveroo app. Doshii will be available for use by the more than 10,000 restaurants that partner with Deliveroo across Australia and to POS vendors as the preferred platform to connect to Deliveroo.

Deliveroo orders typically take approximately 90 seconds for restaurants to manually enter and process. This partnership is set to provide significant savings by allowing restaurants to focus their efforts and resource on front-of-house operations, reducing errors and making it even easier and quicker for staff to process orders. This is also where mistakes can be made in double handling and manually entering the order from Deliveroo to the POS system, which means the costs add up for venues.

Deliveroo country manager in Australia, Levi Aron, said: “At Deliveroo we are constantly innovating and looking for ways to help our restaurants grow. POS integration is the number one feature restaurants are requesting around the world, and a key way that Deliveroo can help improve the performance of their business. Not only will this Australian partnership lead to cost savings for restaurants, but it will also see customers benefit with meals that are prepared and delivered faster.”

Integrating directly with the POS will also remove the need for restaurants to reconcile between the Deliveroo App and the POS. This creates further time efficiencies for restaurants and their staff, who may have multiple order ahead apps that all need to be reviewed and matched up at the end of the month.

The Doshii platform, which is open to any POS and any App, allows venues a variety of choice based on an open ecosystem. It currently allows connection to over 6,500 venues across Australia, however this number is set to increase in the coming months. With recent investment from Coca Cola Amatil, Doshii will continue to develop its technology to deliver value back to venue owners by allowing them to connect their favourite Apps direct to their POS systems.

Doshii founder and CEO, Sean O’Meara explains. “Doshii is more than just connectivity of Apps to venues’ POS systems – the platform and marketplace of Apps is designed to allow venue operators to select, trial and evaluate Apps to suit their business, all connected to their Point of Sale system.  The addition of Deliveroo to our growing number of connected Apps is extremely exciting, and fits within our expansion goals of providing a common platform to connect to POS for the hospitality and retail markets both in Australia and across Asia.”

The integration of Doshii’s API Platform is the latest in a number of recent innovations Deliveroo has introduced in Australia to help restaurants thrive. Recently Deliveroo announced a Restaurant Perks program designed to help restaurants reduce costs and improve overall business and operational efficiencies. The Program involves partnerships with Australian Online Printing, Sidekicker, Powershop and others, offering Deliveroo’s restaurant partners discounted access to essential business services such as utilities, recruitment, card payments, printing, restaurant operations and financial support. Deliveroo also recently announced a new data insights package, Restaurant Home, that gives Australian restaurant partners access to data on their performance which they can use to accelerate their growth.

Deliveroo hopes to grow numbers by launching a BYO rider system

Deliveroo is launching a new system in Australia where food outlets supply their own delivery people.

The food delivery service hopes this will help grow the number of people using their platform.

Deliveroo said this would help double the number of restaurant using its platform to 12,000 by the end of 2018.

The delivery platform, known as Marketplace+, launched in Australia on the 6th of September.

READ: Foodora stops food delivery services in Australia

The platform allows restaurants to list their delivery services on Deliveroo’s website, but at a lower fee if they use their own drivers or riders.

Traditionally, Deliveroo has supplied drivers or riders as part of its service to restaurants on its platform.

It was introduced to the UK and European markets in early-mid 2018.

From July, Deliveroo customers in the UK had 5,000 more restaurants to choose from at a wider range of prices, with the help or the new platform.

Customers on the app can see both restaurants who make use of Deliveroo’s ‘core’ delivery network and restaurants who deliver meals themselves.

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