Delivery Meltdown

The Lempert Report
March 01, 2022

Sally: Okay, Phil, I wanted to talk about delivery. I have, I have found out about this new company, but first let's talk about what the problem with delivery is. So, so many wrestlers 

Phil: Nobody's making any money.

Sally: Exactly. 

Phil: Nobody's making any money.

Sally: Exactly. Yes. You know, these restaurants had to very quickly adapt to a lot of delivery. It's delivery rates have remained really higher than they were pre COVID, but there's all kinds of issues and it's very, and it's hard to make money.

Phil: Yeah. And also and looking at this report there's comes from CNN. The interesting thing is a lot of restaurants are talking about the fact that delivery is stressful for employees. They have to balance taking care of in-store customers, obviously filling increasing orders up to go orders before the pandemic 2019, according to techno Euro monitor delivery accounted for about at 7% of total us restaurant sales, this is delivery pizza. It's everything. Obviously there was a spike during the pandemic. Now it's back down to 9%. So it, it's interesting gorillas we saw last week, you know, the, the 10 minute delivery firm in New York city, , well last Friday, guess what they pulled back. They're saying we can't deliver in 10 minutes anymore. So that promise is no longer. And also to your point, the economics, it costs a restaurant about 30% of the order in fees for these third party providers. So it just doesn't make a lot of sense. There is a lot of innovation going on, just saw a picture of a fast food restaurant that put in three drive through lanes so that they can handle cause people want to do more drive through than ever before. We're seeing that what else we got?

Sally: Well, just real quickly. There is a company called club feast, a new company that is out of San Francisco in Manhattan, and they're doing something really cool. And they say that they can re the customers can save 40% on restaurant delivery, which also is helping the restaurants as well. But what they're doing is they're they're working with restaurants to create a menu that is large. They can make large batches of, and people are ordering it ahead of time rather than right when they want it on demand. Right. So check out club feast. There's some, it, it's also a great, interesting, it's an interesting approach to reducing food waste. I really like what, what they're doing. That's club feast, and they've got a website