Operators tap into opportunities by offering delivery with online and mobile ordering in winter months. Sponsored by GrubHub.
As with many industries, inclement weather can be detrimental to a business owner’s sales. For the restaurant industry in particular, a dip in winter temperatures usually means a dip in sales. But an increasing number of operators are finding a way to keep their business robust, even as consumers are battening down the hatches and staying indoors as much as possible.
“Chicago can be very cold sometimes, and people don’t want to go out,” says Badara Diakhate,-owner of Badou Senegalese Cuisine. “Traffic is slow, yet at the same time, you see online ordering picking up.”
Diakhate has offered online ordering since opening his restaurant three years ago. As a small, independent operator he partnered with GrubHub, the nation’s leading online and mobile food ordering company. With GrubHub, restaurant owners can tap into the company’s 6.4 million active diners and leverage their order technology to drive orders when customers are less inclined to dine in.
GrubHub recently teamed up with a leading economic consulting firm to uncover the effect that online ordering can have on restaurants. The GrubHub Economic Impact Study found that by using GrubHub’s online and mobile platforms, a restaurant can increase its takeout order volume by 20 percent.
“Whenever the weather is inclement — rainy, snowy, very cold — the trend is for delivery to go up,” says Denver restaurant consultant F. Warren Ellish of Ellish Marketing Group.
Although restaurant sales declined last winter along with major retail sectors, spending at non-store retailers — online shopping — improved, reports Bruce Grindy, chief economist for the National Restaurant Association.
For this winter, The Weather Chanel reports that residents of the Southwest, Southern Plains, Southeast and East Coast could expect to see another colder-than-average season. However, operators who are using online and mobile ordering are optimistic sales can remain strong during the season.
“We have so much delivery and demand for our food,” says Dimitri Kapelonis, owner of NatureWorks, a fast-casual concept with three locations in New York City. “Delivery accounts for 40 to 50 percent of our business, and that goes up in January after the holidays.”
Through its partnership with GrubHub and its regional brands in New York, Seamless and Seamless Corporate Accounts, Kapelonis says he has been able to attract and retain lucrative corporate customers as well as loyal online customers. Area business people can find NatureWorks on the GrubHub platforms as they search for restaurants near their office. Through Seamless Corporate Accounts, companies can also find restaurants that cater to large group orders that can be delivered for meetings or during peak business hours so employees don’t lose productivity.
“It enables us to get into areas we would never reach on our own,” Kapelonis says.
According to the National Restaurant Association, 60 percent of adults say they would likely take advantage of delivery to their homes or offices if quick-service and fast-casual restaurants offered it. And nearly one-third say the availability of technology options is a key factor when choosing a limited-service restaurant.
The GrubHub study also found restaurants that offer online ordering through GrubHub see a 30-percent increase in takeout revenue. Even small, independent restaurants averaging less than $2,500 a month in sales see a 50-percent increase in sales.
“The technology has improved ordering methods,” Ellish says. “The majority of orders are occurring online, whether from a mobile device or computers, instead of telephones,” he says. “The brands that use automation to track orders in a more sophisticated way excel in delivery versus the old fashioned way.”
According to the study, operators who used GrubHut cut their order-processing time by more than 50 percent. By adding online ordering, restaurants can quickly tap into more revenue potential without expensive capital projects or risky changes such as a sweeping menu overhaul.
Kapelonis of Natureworks says the technology is saving money. He manages orders through GrubHub’s OrderHub, an easy-to-use tablet for tracking and confirming online orders.
“If we were taking all our orders over the phone, I’d have to hire four or five extra people just to take care of calls,” he says. “Also, this leaves no room for human error. Whatever the customer puts in, that’s what we send out.”
Compared to phone orders, processing online orders is much faster, the GrubHub study notes. Seventy-five percent of phone orders take more than one minute to process, while about a third of phone orders will tie up a restaurant employee for more than three minutes. However, the average order processing time through GrubHub is approximately 45 seconds.
GrubHub’s study is based on a survey from restaurants across the country, including those using the GrubHub platform and those who do not. The non-GrubHub category includes restaurants that use other online sources as well as restaurants that do not offer any online or mobile ordering.
Diakhate in Chicago says delivery still accounts for about 50 percent of his business. He has added other providers, although the majority of the restaurant’s online and mobile orders come from GrubHub.
The connection with GrubHub enables him as a new restaurant with an ethnic cuisine to attract customers who otherwise might not have found him, he says.
“I see the tremendous impact it has had financially on my restaurant,” Diakhate says. “And they are keeping me in business so I don’t lose money during the winter.”
To learn more about how restaurants can benefit from working with GrubHub, visit: economicimpact.grubhub.com.