Fast Casual: Will delivery drive sales or gobble up profits?

The recent news of YUM investing $200 million in Grubhub has the foodservice industry talking. The rise of third-party delivery services has been a challenge for restaurants because markups are sometimes as high as 35%. These high fees often leave the restaurant making little to no money on their sales.

A new Fast Casual article begs the question, is delivery worth it? Christopher Sebes, president, Xenial (formerly known as Heartland Commerce), isn’t so sure.

“There will be an increase in complexity in terms of order management/flow and fulfillment. The cost here is the labor cost of figuring all of this out and making it run smoothly for everyone, including minimizing impact on in-store customers. This last point is an important one, and not to be overlooked. If delivery orders and in-store orders peak at the same time, will store customers walk away or not even bother to come in, in the first place, causing in-store sales to drop off, offsetting the advances you've made in your delivery business sales?”

If you are planning on implementing a delivery service, it's important? to track your POS closely so you are aware of the impact it's having on your business.