Navigating delivery can be tough for restaurants just starting to offer the service.
But three leading operators — Mario Del Pero, co-founder and CEO of Mendocino Farms; Frank Klein, CEO of Asian Box; and Casey Taylor Patten, co-founder of Taylor Gourmet — said that despite the challenges, delivery can be a critical part of taking growth to the next level.
The operators participated in a recent MUFSO panel titled “Delivery Disruption,” sponsored by Grubhub for Restaurants.
For Del Pero and Klein, delivery began not so much as a strategic decision, but practically by accident.
From the start, Del Pero’s 13-unit Mendocino Farms concept was designed to excel at catering. But eventually, Del Pero learned that third-party delivery provider Postmates was delivering Mendocino Farms’ food without the brand’s knowledge.
“That’s impossible — we can’t even do that at our own restaurant,” Del Pero said when he learned of the situation.
While Los Angeles-based Mendocino Farms initially canceled the Postmates orders that were coming in, Del Pero started talking with the provider.
“The ability to have a real conversation with any of these delivery companies is the start of maybe having a very dynamic relationship,” he said.
Ultimately, Mendocino Farms decided to partner with DoorDash, and now does about $2 million in delivery sales through the provider. Mendocino Farms is not an official partner of Postmates, although the service continues to deliver its food. Delivery through Postmates accounts for about $700,000 in sales for Mendocino Farms.
Asian Box also has a history with DoorDash: Tony Xu, co-founder and CEO of the provider, solicited advice from Asian Box CEO Klein early on about working with restaurants.
Klein said his was concerned with maintaining the quality of the food and consistent branding while using a third party.
“We were very concerned that someone was taking our precious product and doing God knows what with it” before it got to the customer, Klein said.
Five-unit Asian Box chose to partner with DoorDash for delivery, which accounts for 14 percent of overall business. The chain is even tailoring packaging and restaurant design specifically for delivery.
For instance, the San Francisco-based brand created a special delivery box, instead of its typical compostable box, for those orders.
And its newest restaurant in Irvine, Calif., features a labyrinth of cubbies to store DoorDash orders until delivery staff pick them up, and a side door dedicated to delivery orders. Klein noted the importance of not confusing dine-in customers with the comings and goings of delivery workers.
Ultimately, Asian Box has found delivery to be positive for the business.
“It can be so financially rewarding if you do delivery right,” Klein said.
Washington, D.C.-based Taylor Gourmet has also found delivery financially rewarding. The 11-unit sandwich concept, which was founded in 2008, initially opted to develop an in-house delivery service as a way to generate growth.
“We knew it could be a piece to go into transitioning neighborhoods,” said co-founder Patten. “It could help supplement us as we grew.”
While the demand for delivery was there — at the time, 30 percent of business came from delivery — the system was logistically chaotic and overtaxed staff, particularly during peak lunch times, when dine-in and delivery customers overlapped.
Patten knew there had to be a better way.
“For us, it had to be an integrated solution where our employees didn’t have to think,” he said. Taylor Gourmet chose the provider Dispatch by Olo, which Patten said helped ease pain points.
Through the process of refining its delivery service, Taylor Gourmet has seen the delivery business grow 132 percent, and order size increase 60 percent.
Del Pero, Klein and Patten offered some key tips for operators just getting started with delivery, and those looking to improve their service:
• Understand the relationship. Del Pero advised operators to test various delivery services before committing to a partner. Next, reach out to potential providers to get a sense of the relationship dynamics, and especially how open they are to suggestions. “The tech companies that have made it have stayed open to that dynamic,” he said.
• Be aware of your brand. Klein said that maintaining the brand experience for all customers, whether delivery or dine-in, is critical. “It’s so important to worry about that,” he said. Next up for Asian Box is using delivery as a brand marketing tool.
• Identify growth opportunities. Taylor Gourmet saw delivery as a way to expand its footprint and reach potential customers who might not have visited restaurants in person, Patten said. Delivery data can reveal where customers are clustered, and where the chain should grow next. “We try to use the data to make strategic real estate decisions,” he said.
Contact Marcella Veneziale at [email protected]m