What delivery apps actually cost you

Ask a restaurant owner what delivery apps cost them and the answer is almost always a percentage. It's the number in their head, it's the one written in the agreement, and it's the smallest of the three costs they're paying.

Run the numbers with yours, not with an average

Rates change from one platform to another, one plan to another, one negotiated agreement to another. An average you found online tells you nothing about your restaurant. Pull your last twelve months of statements instead and do this.

1. The total the apps collected for the year: that's the gross revenue they processed.
2. The total they paid you. The gap between the two is what they kept. Not just commission: processing fees, service fees, the promotions you opted into.
3. Divide that gap by your usual net margin. The result is the revenue you would have had to do in your dining room to end up in the same place.

The second cost: the customer you don't know

That one appears on no invoice, and it's the most expensive over time. When an order goes through an app, the person who ordered doesn't become your customer. Their email, their address, what they ordered, how often they come back: all of it stays on the platform's side.

In practice, you can't write to them. You can't know they ordered four times in March and nothing since. You can't offer them anything to come back. You pay to serve them, and you're not allowed to talk to them.

The app knows all of it. And it uses it: to suggest the restaurant next door to them next week.

The third cost: your prices

Plenty of restaurants raise their prices on the apps to absorb the commission. It's logical, and it comes back at you two ways.

• A customer comparing your online menu with your dining-room menu sees two prices. The one they remember is the higher one.
• Your dish looks expensive next to a competitor who hasn't done the math yet. You lose the order without ever knowing why.

This doesn't mean shutting it all down

Apps bring orders you wouldn't have had, especially early on, especially in a busy neighbourhood. They put a restaurant in front of people who would never have looked for it. That has value, and nobody serious will tell you to close your accounts tomorrow morning.

The question isn't “app or no app.” It's: what share of your orders goes through a middleman who keeps your customer? If the answer is “nearly all of them,” your restaurant is renting its own clientele.

Where to start

1. Do the calculation from the first section. One afternoon, your statements, a calculator. Most owners have never done it all the way through.
2. Give your regulars a direct path. People ordering every week have no reason to go through a middleman: they do it because that's the path they were shown.
3. Keep the addresses of customers who order directly. That's what lets you talk to them again, and it's exactly what no platform will hand you.

If you want us to run the numbers with you, give us a call. Thirty minutes, your figures in hand. We'll tell you what we see, even when what we see is that the problem is somewhere else.