lessons learned by stadium & paperchase...condiments, sauces, chopsticks, dressings… remove...
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MAKING FOOD DELIVERY PROFITABLELessons learned by STADIUM & Paperchase
Unit Economics
Delivery Packaging
Menu
4 key areas to master your delivery business
servedbystadium.compchase.com
A little bit about STADIUMSTADIUM specializes in corporate lunch delivery to offices in NYC
Daily Lunches Delivered
~2,000 per day ~10K per week ~42K per month
Unique NYC Buildings Visits
75 per day 247 per week 310 per month
Unique Company Relationships
2,628
Active Restaurant/Brand Partners
149
Total Individual Customers in NYC
78,918
Unique Office Visits
120 per day 397 per week
1,711 per month
Total Lunch Organizers
(Office managers, hosts,)
6,998
On-Time Delivery Rate
99.3%
A little bit about PaperchasePaperchase helps restaurants make better decisions with data
Book keeping Menu & profit optimization
Pre opening budget and
variance analysis
Sales forecasting Optimized staff scheduling Investor reporting
Annual audit package
Cash flow management and
consulting
Key performance indicators
Owner & chef analytics
Food & beverage costing Monthly financials Vendor & debtor
reconciliationParoll & gratuity
distributionBank
reconciliation
4 key areas to master your delivery business
Unit Economics
Delivery Packaging
Menu
Key ingredients
Travel-ability Portions Pricing Variety & changeTransparency
Designing a menu for delivery
Create, curate, and eliminate Create delivery dishes from the group up
Modify current dishes to optimize for delivery
Eliminate what doesn’t travel
Tacos Certain pastas Open faced sandwiches Deep fried dishes
Examples of dishes that deteriorate during delivery
Not all dishes will travel
Transparency - PortionsManaging expectations is key
* these are recommended weights for entree sized portions
Transparency - Serving temperatureManaging expectations is key
Pricing for delivery
*all fees and taxes included
Individuals tend to be more price sensitive when getting lunch delivered
Price based on your audience
Individual paying ~ $12 pp
Company paid lunch ~ $15 pp
Business lunches ~ $20 pp
“I am paying for my own lunch”
Daily or weekly employer sponsored lunch programs
Client meetings, vendor sponsored lunches
STADIUM’s focus Avg. spend per diner: $16.75
Balancing change & variety
• For customers to repeat order your food, a rotating menu is key. “new dishes”, seasonals, specials.
• Balance staples and new dishes
• For larger groups to order, you need enough variety to satiate all tastes and dietary restrictions
Experiment, collect feedback, and iterate
Collecting and iterating on feedback is key to perfecting a dish
STADIUM’s ratings and reviews for restaurant partners
Data here is only for illustration purposes
4 key areas to master your delivery business
Unit Economics
DeliveryPackaging
Menu
Perfecting your packaging
• Research what’s available for your type of food. STADIUM has worked with 2,119 types of different containers.
• Perform test runs, and think outside the box.
• Balance perception and reality
• Extra large or a half empty container will make food portion look small
Are the containers stackable?
To avoid slides during transit When stacking, put heavy dishes at the
bottom
Bio vs. Plastic Depends on the dish
Pluses for bio containers Eco friendly On-brand
Negatives for bio containers Lids don’t shut tight
Moisture can cause issues
Spill-proof? Tape or saran wrap the dish
Is container large enough for mixing? Consideration if dish needs mixing. Salads, curry w/ rice, ramen + broth
Dressing on the side Preferred by most customers for salads
Hot & cold ingredients in the
same dish?
Poke conundrum Hot rice + cold sushi causes fish to
deteriorate during transit
Cool rice before preparing dish Or use different containers
Greens in a hot dish? Greens can wilt during transit.
Pack greens separate or serve at ambient temperature or avoid greens
Extra large container Food will move around during transit and
perception will be “half empty”
Ventilation
Consideration for certain hot dishes
Add-ons are key
Condiments, Sauces, chopsticks, dressings…
Remove any chances of “forgetting"
Pack hot & cold dishes separate
This helps retain temperature. Beverages, guacamole…
Thoughtful packaging
4 key areas to master your delivery business
Unit Economics
DeliveryPackaging
Menu
If you plan to hire your own delivery staff know that…
Labor/staffing issues will be a constant
source of frustration
Delivering $30 orders will NOT be profitable!
Labor + insurance costs far outweigh the revenue
Average order value should be greater than $50 for economics to make sense
Demand will be very unpredictable
Rainy/snow days will cause a surge Monday will be very different from a
Sunday
Refunds will eat into your profitability
Customer complaints about late deliveries, food not arriving at the correct
temperature etc
Which delivery platform(s) to partner with?
Image courtesy: CB Insights (STADIUM added)
Different styles, different players
INDIVIDUAL DELIVERY
UberEats Doordash Seamless
Caviar Postmates Grubhub
Eat24
GROUP ORDERING Individual dishes in bulk
STADIUM
CATERING STYLE
Cater2Me Zero Cater EZ Cater
PICKUP
Ritual MealPal
POPUPS
Fooda
DELIVERY FULFILLMENT
Relay
ORDERING PORTALS
Might not do the delivery
Grubhub Seamless ChowNow
This is the landscape in NYC in Feb 2019 and by no means is this list exhaustive
Depending on your objectives, multiple partners can make sense
Evaluating partners
Do they cannibalize my existing walk in or
catering business?
Does the service expand my
restaurant’s reach?
Expanded delivery zone
Does the service get me orders during
downtime?
Company relationships
Familiarity with delivery protocol of security buildings?
Insurance coverage Certificates of Insurance (COI)
Pricing and payment terms
Flexibility is key
NO to exclusives!
Landscape is constantly changing
Do I need to hire delivery staff?
4 key areas to master your delivery business
Unit Economics
Delivery Packaging
Menu
Key is to increase utilization of existing resources
Additional revenue from delivery $10,000 100%
— Food cost -$2,500 25%
— Additional packaging cost -$500 5%
— Additional labor cost $0 0%
— Other fees/costs -$3,000 30%
Contribution margin $4,000 40%
This would be non-zero IF you are hiring additional people to support delivery/take out operations
Key is to increase utilization of existing fixed resources (rent, labor..) which would increase dollar profitability
Assuming delivery revenue doesn’t affect in-store business
Delivery is tough
TechCrunch Eater
TechCrunch
Quartz
The Spoon
New Yorker
Quartz
CB Insights
BUT delivery is also the future
Is the kitchen dead?UBS estimates global online food ordering could leap from $35bn dollars today to $365bn by 2030. It’s thanks to a convergence of the on-demand and sharing economies, and a combination of industrial, economic and demographic factors. Analyst Chris Grundberg explains the UBS Evidence Lab research, and considers whether the kitchen is dead. — Financial Times + UBS
Millennials are 3X more likely to order in than their parents — UBS
Bloomberg Businessweek +MS
Let’s tackle together hello@pchase.com | purchasing@servedbystadium.com
How does STADIUM help your restaurant?
• Downtime utilization
• Steady, bulk volume. We buy $10,000 - $30,000 worth of food from our core restaurant partners each month. We expect this to reach $50,000 in 6 months.
• No cannibalization
• Plug into our network. 1,900+ companies in NYC. 78,000+ users in NYC
• We pickup & deliver. No extra delivery labor on your end
• Expand your reach. We deliver to all addresses south of 59th street in Manhattan
• Market your restaurant
• Continuous feedback so we all improve
• Analytics - Trends, benchmarking, ratings, reviews (coming soon)
servedbystadium.com/menu | purchasing@servedbystadium.com
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