Best Food Delivery Services for Restaurants in 2020
Ordering food in is more popular than ever, and with food delivery apps, it’s easier than ever. The market is saturated with food delivery services that offer online ordering platforms and delivery right to your door, with abundant restaurants available online. If your restaurant does not deliver, you may be missing out on sales.
Choosing a restaurant delivery service can be difficult however. Each charges fees to both the customers and the restaurant, so it’s important to find a food delivery app that will benefit your restaurant’s business and bring in more customers and income. If you’re looking for a third party delivery service for your restaurant, look no further. We’ve reviewed the most popular food delivery apps available today.
Best Food Delivery Apps for Restaurants
DoorDash has surpassed competitors, becoming the most popular food delivery app according to Fortune Magazine. As of 2019, DoorDash had the largest share of the market at 27.6%. DoorDash is a great choice for restaurants and consumers, with low fees and a wide range of locations.
DoorDash is available in all 50 states and over 800 US cities. The company takes a commission of about 20% of the restaurant’s order, which is on the lower end of third party delivery services. The fees for customers are on the lower end as well, although they vary by restaurant. DoorDash is also flexible in terms of how restaurants receive orders; they’ll send orders through your restaurant’s preferred method, so it can easily fit with your POS technology.
The DoorDash app is very user-friendly and easy to use, so customers have no problem placing orders. The app has GPS tracking, status updates for orders, and customer service. Frequent users can sign up for a DashPass, which gives them free delivery and lower service fees for only $10 a month.
DoorDash is one of the best options for restaurants in need of a delivery service for various reasons. First, it has the largest share of the market and a wide range of locations, so plenty of customers can find you on DoorDash. Second, it has low commission fees for restaurants and low service fees for customers. The app is also a plus. If you’re looking for a restaurant delivery service, consider DoorDash.
Availability: All 50 states, 900 US cities
Commission Fees: ~20%
Caviar has set itself apart from other food delivery apps as an upscale service, as the name suggests. There are fewer restaurants on Caviar, and some estimates put their market share at only 3% compared to other third party delivery services. Rather than compete with bigger names, however, Caviar has created its own niche of upscale food delivery.
Caviar is more selective than other food delivery apps in terms of restaurants it features, drivers, and locations. It is only available in 11 major cities, so it is not an option for many restaurants. The restaurants it does feature are typically high end with more expensive food costs. Customer spending average is significantly higher on Caviar.
The commission cost is about 25%, slightly higher than DoorDash but lower than many others. The low commission paired with more expensive food bills is a plus for restaurants that meet Caviar’s criteria. The fees for customers are mid-range, about the same as any other delivery app.
The Caviar app is easy to use, with GPS tracking on orders and an accessible customer service line. Caviar is affiliated with Square POS, so it connects directly to this system when sending orders to restaurants. If your restaurant already uses Square, this makes things even easier. For upscale restaurants looking to get into delivery, Caviar is a great option provided you are in one of their service areas.
Availability: 11 major cities
Commission Fees: ~25%
Grubhub was the original online food delivery service, and used to hold the largest share of the market. Grubhub also owns Seamless, and the two share almost the exact same app. Grubhub also bought out other services like Eat24, Foodler, and OrderUp.
Grubhub and Seamless together operate in over 2700 US cities, as buying all of those smaller delivery services has widened its range. They have a market share of about 26.9% as of 2019, just behind DoorDash, although they used to have 33%. Grubhub is partnered with a huge number of restaurants and has an estimated 14.5 million users.
Grubhub works with so many different restaurants that their commission for restaurants has a wide range – anywhere from 15 to 30%. While 15% is one of the cheapest options for restaurants, 30% is on the higher end. The customer fees on Grubhub range as well from low end to expensive, although these are often countered by delivery deals, discounts, and other perks.
One benefit of Grubhub is that they will work with a restaurant’s existing delivery drivers, so you can continue to use drivers you have on staff. They also offer POS integration, so it’s easy for restaurants to receive orders. Another plus is that they can integrate an online order link on your website, so it’s easy for customers on your site to order. The app is also very easy to use.
Availability: All 50 states, over 2700 cities
Commission Fees: 15-30%
Postmates is a smaller delivery service, but it has great features and many happy customers. As of 2019, Postmates is available in most states and 1500 cities, but has about 12% of the delivery market. This means there are fewer customers using Postmates that will find and order from your restaurant on the platform.
The Postmates app is easy to use, and often has discounts offered. The Party section allows users to share a driver with other users in their area ordering from certain restaurants at the same time. This brings in a lot of repeat customers on the food delivery app.
Commission costs on Postmates are on the higher end for restaurants at about 30%. This can be a steep price to pay, which is why many restaurants opt for one of the cheaper options. The fees for customers range from very affordable to expensive, so it can be hard to gauge what customers will pay as well.
Postmates does offer an unlimited plan for $10 a month or $100 a year that comes with free delivery on all orders over $15, plus other perks like no surge pricing. For restaurants, however, the 30% commission and lower market share makes Postmates a less ideal partner.
Availability: All 50 states, over 1500 cities
Commission Fees: ~30%
UberEats is an extension of the rideshare app that delivers food. Because Uber is a widely used service, UberEats has access to a large fleet of drivers and plenty of customers. UberEats is available in over 500 cities in the US and around the world as well, and considering the success of Uber rides, it will likely grow. UberEats pulls about 25% of the market share.
There are some benefits of using UberEats, including its decent share of the market and plenty of users. The app is very easy to use, and there are plenty of restaurants partnered. It has GPS tracking for orders and often faster delivery times than some others due to the large number of Uber drivers.
There are some drawbacks to using UberEats, however. The drivers are not trained as food delivery drivers, but are rideshare partners who can also pick up food. While food delivery doesn’t require any difficult skills, some UberEats drivers may have mishaps with food. UberEats customer service can be difficult to get ahold of and may have trouble connecting with drivers.
The other main drawback for restaurants is that partners of UberEats report at 30-40% commission from each bill. This is a hefty percentage for restaurants to sacrifice, so if there is another food delivery service operating in your area, it may be a better option than UberEats.
Availability: All 50 states, over 500 cities
Commission Fees: ~30-40%
DIY Delivery Services
It is worthwhile to consider hiring your own delivery drivers for your restaurant, especially if you get a lot of to-go orders. There are costs to hiring extra staff for delivery, but depending on the third party delivery services in your area, it may be more cost effective to handle deliveries internally.
If you do choose to deliver through your own service, there are some costs to consider. You’ll have to hire extra staff to work as delivery drivers, and those costs may also include insurance premiums, gas compensation, and so on.
Another expense to consider is the cost of online ordering. Many customers today prefer ordering on an online platform as opposed to calling on the phone, so you may want to build an online ordering system on your website. This can be costly, as you’ll need to hire a developer to make it all happen.
The benefit of a DIY delivery service for your restaurant is that you won’t lose any money that the food delivery apps take. To counteract the cost of hiring delivery drivers, some restaurants simply tack on their own delivery fee. If your restaurant has lots of takeout orders, hiring your own delivery drivers may be the better move for your business.
How To Choose a Restaurant Delivery Service
There are plenty of options out there today for food delivery – we listed the top competitors, but others exist. Choosing the best one for your restaurant can be confusing, as you want to make the choice that is best for your restaurant’s profit margins. Look for these factors when choosing a food delivery app partnership.
Availability in Your Location
The first factor to look at to weed out delivery services is availability in your specific location. Not all food delivery apps operate in every city, so you can easily cross off a few by seeing if they deliver in your area. Restaurants in major cities will have plenty of options to choose from, while less populated areas may have fewer food delivery options.
Popularity with Customers
Aside from just availability, you should also look for information regarding their popularity in your area. If one delivery app is available but doesn’t have many users, it won’t really help your restaurant business. You can gauge popularity by doing some research online, asking customers what their preferred delivery app is, or talking to a company rep about their stats in your area. You can also sign up as a customer for various apps to gauge what restaurants are available and which seems the most popular.
Restaurant and Customer Fees
How do fees work on each delivery app? Most charge a service fee to customers as well as a percentage of the bill from the restaurant. The commission rates for each service range from 15-40% of the bill – which comes out of your restaurant’s pockets.
Consider what rate you can afford to pay the delivery services without losing money. If you only make a 20% profit on your food, a delivery app with a 30% commission fee will not make sense for you. Look at your profit margins and consider the costs before partnering with a food delivery app.
You should also consider how your customers will enjoy each app. Using the most popular one in your area or with your customers is a step in the right direction, but you should really consider how your customers order. If a delivery driver does a bad job and the order gets cold or otherwise messed up, it will reflect on your restaurant. Even though the driver is not a staff member, most customers will likely blame the restaurant as well as the delivery service. Partner with a quality delivery service to ensure that food is handled properly and customers are happy.
If your restaurant needs a delivery service, we’ve listed the best options for you to pick from. While third party online food delivery can be costly, it can also take some processes of your restaurant’s plate. Consider what works best for your restaurant and reach new customers with one of the best food delivery services.
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