Food Delivery Apps: Boon or Bane for Restaurant Franchisees?
The inundation of technology and smartphones has transformed our way of living. Now, a person is able to get anything, from taxi to food, from the comfort of their home with just a few taps and swipes.
Technology has impacted the food & beverage industry, that too profusely. The concept of “dine-in” has been replaced by “eating-in” and “Netflix and chill”. The usage of food and restaurant apps has increased by 70% since 2014, to its current standing of 34%.
Besides, urban dining habits, food delivery apps are even reforming the way restaurant franchises do their business. With many major players tying up with food delivery apps to increase their parameter of serving, these apps are increasing their annual revenue. But on the contrary, decreasing the footfall. So, the question is, are food delivery apps really a boon, or a bane in disguise.
Advantages
-Irresistible Offers
The delivery apps have not only increased the profit share of food chains but also increased the demand. These apps offer irresistible offers, discounts which makes it tempting for the consumers to order food, even if they weren’t thinking about ordering in.
-Convenience increases demand
In today's fast-paced world, people don’t have the time to waste. With these delivery apps, people can have food at their doorstep without compromising the quality of food and their work schedule. So, customers prefer ordering in, instead of the hassle of cooking and waiting at the restaurant for their food to arrive.
-Increased Reach
While the major food franchisees have their own fleet of food delivery, but they cannot match the reach of these food delivery apps. This is one of the profound reasons why these food chains are partnering with major delivery apps.
For Instance, Coffee chain Barista was in advanced stage of talks with Swiggy for serving the customers online. Cafe Coffee Day joined hands with UberEats to launch a virtual restaurant network.
Disadvantages
-Decrease in Footfall
While the food delivery apps, has increased the reach for restaurant chains, it has eventually decreased the physical footfall. This affects the restaurant chain in a lot many ways. They have to pay for staff, infrastructure, property etc. to maintain a restaurant chain, but if the outlet is relatively empty, all these things are shrinks the profit share.
-Effects Quality of Service
Food delivery apps have time boundations, they have to deliver the food within the set period of time. Hence, the restaurant chains have to take them as the priority and prepare their order first. This affects the service quality of dine-in customers. During rush hour, there is often delay in preparing the order of a dine-in customer, which causes a dissatisfaction for the customers, affecting the overall rating & review of the restaurant.
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