Forbes: Third-Party Delivery Is More Important Than Ever

While in-house delivery is a great way for restaurants to expand their business to local communities, it comes with extra labor costs. In a recent Forbes column, Founder and CEO of SMB Franchise Advisors Steve Beagelman discusses how third-party delivery services are not only a solid alternative to in-house delivery, but in some cases are essential for a restaurant’s survival during COVID-19.

A veteran in the third-party service space, Beagelman co-founded Black Tie Delivery Service in 1991, one of the first delivery companies to offer customers convenience with a side of their favorite meal. Though Black Tie lacked today’s technology, the franchise saw continued growth, and Beagelman was eventually able to sell it to one of his competitors for nationwide expansion.

Fast forward 30 years, and third-party delivery is seeing continued growth. According to a study conducted by Zion & Zion, 63% of young adults regularly use third-party delivery apps. Grubhub, Uber Eats and DoorDash are some of the big players offering customers what they want most: convenience.

“When the pandemic hit, it made third-party delivery services an essential revenue stream for many of these restaurant operators,” said Beagelman. “As dining rooms remain half empty, or even worse, completely empty in some areas of the country and consumers grow accustomed to the convenience, a thorough and reliable delivery platform will continue to be crucial for keeping revenue coming in.”

Beagelman suggests all restaurant brands start researching different third-party options if they haven’t already. Whether a franchise or not, selecting a partner that best fits with a brand’s current model will prove to be the most valuable strategy and can result in immediate revenue generation.