Restaurants and cafes in Auckland are now able to register with UberEats, Uber’s on-demand food delivery service. The service is currently offered in 50 cities worldwide and looks to continue its expansion. Uber has experimented with parcel pick-up and delivery but the food service proved to have the most potential for the company despite it being a hyper-competitive market. Having stepped in to this highly competitive space with a yet-to-be-proven business model, it has highlighted that as opposed to grocery, foodservice has much higher margins to play with allowing the company to collect a fee from the restaurant as well as from the customer for delivery. When it comes to foodservice, customers are generally less price sensitive, as proven with using coupons at the supermarket but buying a Starbucks on the way home.
Around 70 Auckland foodservice establishments signed up to the app including Molten restaurant in Mt Eden.
“UberEats is a great way for us to connect with more of our neighbourhood, especially with Winter coming up where customers just feel like eating their favourite local’s food on the couch,” said Molten. “We did a few trials and have learnt which of our dishes travel well, and those that didn’t and have tailored our UberEats menu so that our dishes arrive with the same quality as if they were in the restaurant.”
Although majority of the establishments that were part of the initial roll out having successful service, there have been many comments already about the disruption to eat-in customers and kitchen management.
“On the first day that we implemented UberEats into our establishment, we found that one of our baristas had to take the order from the iPad to our ordering system to let the kitchen know, which was very time consuming especially in a busy lunch time service,” said Ben Huh, director of Auckland’s newest Korean eatery The Kimchi Project. “From a restaurant owner’s point of view, because we need to build in the cost of packaging for just one bun, and UberEats takes 35 percent from that $10 we don’t see this new on-demand app service as a sales tool, rather that of a marketing tool. I am sure that customers will grow to love the new service more and more over time, just like Melbournians and other big city residents have however it really is just good for gaining a bigger audience and more exposure for the brand/establishment, and we are a part of that, it just doesn’t equal a lot of return for us. We had a lot of orders, however we have to turn it off as the kitchen was overwhelmed with managing both normal lunch service and customers as well as the added orders from the app.”
As competition is high alongside the rise in food and labour costs it is absolutely critical to incorporate the role of technology into your business to ensure profitability and repeat business.
UberEats has continued to roll out new updates and offer data analysis to offshore establishments with UberEats Restaurant Manager which is, at the very base of it, an analytics platform for the restaurant partners participating in its food delivery service. It is essentially TripAdvisor crossed with POS data that table service restaurants use to analyse business but brings it to its delivery service.
“UberEats hopes to make itself more relevant than a glorified answering machine-meets delivery bike by giving restaurants deeper services and insights,” said Jason Clampet, SKIFT co-founder.
As convenient as UberEats is for customers, as Al Brown and Co general manager said, “No matter how strong UberEats becomes, it’s not going to be the same as coming, and getting great service.”