Delivering Success: How Technology Makes Restaurant Delivery A Profit Center

Delivering Success: How Technology Makes Restaurant Delivery A Profit Center

TABLE OF CONTENTS Delivery Rules... Page 3 How to set up your delivery operation Bring Technology to Your Customers... Page 5 How to improve the ordering experience Driver Traffic Control... Page 7 Implementing strong controls Loyalty Inside and Out... Page 9 Harness the marketing power Analyze Performance... Page 11 See what s working and what s not Conclusion... Page 12 ABOUT THR!VE POS If you need technology to help run your delivery restaurant, turn to Thr!ve POS! We ve got the most combined experience in the business with a traditional workstation ipad or Android tablet. With the addition of integrated mobile, labor management and inventory solutions, we ve got you covered! Please give us a call at 800-750-3947 or visit www.thrivepos.com for more info. Delivering Success: How Technology Makes Restaurant Delivery A Profit Center 2

Adding delivery to your restaurant can be a sales-booster, but it can also add a whole new set of operational challenges. The right technology can help. Many POS systems designed for delivery have built-in features that you can leverage to streamline your delivery process. If you aren t using a deliverycentric POS system, it s an investment you may want to consider. Keep in mind some of these important factors when selecting technology for your delivery operation. DELIVERY RULES Successful delivery operations require planning. Don t let the excitement of adding a new service and potentially lucrative revenue stream let you begin without ensuring delivery operations will be an asset and not a drain on your business. Understanding some basic principles of delivery will help you make decisions that will keep your operation profitable. Delivery Area One of the first steps when adding delivery service is to define your delivery area. Industry experts advise keeping driving times within 10 minutes of your restaurant so you ll be able to deliver hot food to your customers. With this in mind, establish a radius of delivery for your shop, considering traffic patterns and distances. Google Maps is a great tool to help define your delivery area it provides distances, but also alternate routes, travel times, and traffic information at different times of the day. Delivering Success: How Technology Makes Restaurant Delivery A Profit Center 3

Another option you can consider is drawing a wider radius and charging a higher delivery fee beyond a certain distance and informing the customers deliver will take longer in these areas. This may be a good option if no other restaurants deliver to those areas. Once you have established a radius, you can also decide if you wish to exclude any areas that are difficult to travel to or dangerous for your drivers. If you have more than one location you ll also need to determine boundary lines for delivery for each restaurant. A point of sale system that integrates with Google maps to enforce your delivery areas, calculate correct delivery fees, and ensure accurate address data entry can help automate managing delivery and improving accuracy and drive times. Charging Delivery Fees For most restaurants, a delivery fee is a standard practice and is well accepted by consumers. However you should consider your competition s fees when setting your price. Whether you charge a flat fee per delivery or fees for zones based on distance, your POS system will help ensure that the right fee is charged to the right customer. Also look for POS functionality that allows you to easily waive fees for VIP customers or offer coupon that cover the delivery fee. Also investigate whether the delivery fee is taxable, which is something that varies by state. Your POS system should allow you to apply taxes if necessary and also to provide clear reports that break out the delivery fee from sales revenue. Order Minimum and Delivery Hours Setting a minimum dollar amount required for delivery is an important way to control costs and avoid making low profit deliveries. Likewise, restricting delivery hours can help control labor costs associated with the service. Make sure to inform your customers of minimum order sizes and deliver hours by adding this information to your website and printing it on takeout menus and promotional materials. Count on your point of sale system to prompt your staff when a request for delivery falls outside the parameters you set, but make sure you have the ability to override and provide delivery for smaller orders or at different times when needed. Delivering Success: How Technology Makes Restaurant Delivery A Profit Center 4

Managing Promise Time Ever since Dominos debuted its famous 30 minute guarantee (which had to be scrapped due to reckless driving lawsuits) delivery restaurants have had to meet customer expectations for timeliness. It s important to set reasonable promise times, communicate a time to the customer, and monitor your operation to make sure you re meeting your goals. Your POS system should help with this by suggesting promise times, making it easy to modify quote times on-the-fly as things get busy, and alerting you if deliveries are running past their quoted time. POS CHECKLIST Map integration to enforce delivery area Easy override with the right security Delivery fees: flat fee / fee per zone / & fee No fee customers Coupon / promotions to waive the fee Taxable vs. non-taxable delivery fee Delivery fee reporting Delivery order minimums Delivery hour restrictions Easily managed promise times Monitoring and alerting of late deliveries BRING TECHNOLOGY TO THE CUSTOMER With delivery making up an important part of your business, you ll be interacting with your customers in new ways. Use technology to help make these interactions positive ones for your customers! Over the Phone Beyond having a good phone system in place with enough lines to handle incoming business, consider adding a message-on-hold to give you the opportunity to entertain and promote new items to your clients if they encounter a brief wait for service. A delivery capable POS system will have added features that help you handle phone orders with ease. A caller ID interface will tie your phone system into your POS to help you quickly find customer records. It can also alert you when you are speaking to a new customers, as well as repeat and VIP customers. Look for a POS system that stores unlimited customer order details, multiple phone numbers and delivery addresses (home, work, etc.) and gives you the flexibility to add custom fields and alerts. It s common for customers to order the same thing frequently, so a quick last order recall feature is a handy way to speed up the order process. Many delivery customers also expect to be able to place orders ahead of time, for Delivering Success: How Technology Makes Restaurant Delivery A Profit Center 5

delivery later in the day or week. Make sure your POS system can automate this process. Your system should also be able to handle payments for those future orders all in a secure, PCI compliant way! Taking payment for phone orders is also a critical part of the process and a critical part of providing great customer service. Most delivery restaurants will take a customer s credit card over the phone. Although the processing cost is slightly higher because the card isn t swiped, you may find it s worth it in the efficiency you gain from running the card immediately, before the food is made. The receipt will be ready for the customer to sign at the door and the driver is quickly headed to the next stop. If you ll deliver to local businesses (often a lucrative market!) it s a good idea to have group ordering capabilities. This will allow you to label individual food orders for each customer but group them all together into one large order for delivery. Customers may want to pay separately, so consider how delivery fees will be divided among multiple people. Delivery-focused POS can help you handle complex situations such as this. Online and Mobile Ordering The popularity of online and mobile ordering is growing. Your customers appreciate the convenience of placing their orders online or via their smartphones, and your business will benefit from needing less labor to take orders, more accurate orders, and higher ticket averages. Choose an online system that completely integrates with your POS system, so orders flow smoothly from the website to the kitchen. A tight integration that automates updates for pricing, new menu items and coupons online really helps make managing your system more efficient. You ll also want to make sure that all the delivery rules you put in place, such as delivery area, minimum orders, and delivery fees, are also enforced by the online system. POS CHECKLIST Caller ID integration Flexible customer database Multiple phone numbers and addresses Last order recall Future orders Phone payments Group ordering Integrated online and mobile ordering Delivering Success: How Technology Makes Restaurant Delivery A Profit Center 6

DRIVER TRAFFIC CONTROL Once you add delivery to your operation, you ve added a new level of complexity and management challenge. Dispatch Operations The first step to success is to set up an effective dispatch operation. For busy restaurants, a dedicated dispatcher manages the flow of orders, assigning them to drivers. For most restaurants, however, the drivers take care of this step themselves, which can result in inefficiencies, especially if drivers cherry pick orders for customers who are the best tippers. Your POS system can help the process become more efficient by assigning drivers in order and showing the right order to deliver next, so none of the orders will be late. Security features can also dictate how many orders a driver can take at once. The moment when the driver walks out the door, is a notorious time for errors. Drivers grab the wrong pizza or forget the 2-liter soft drink that goes with it. Your POS system can help your team with more accurate deliveries, reminding drivers of critical items in the order. It will also help to print box labels to tie all the items in an order together. The time when an order is assembled is also a great opportunity to automatically reprint a clean copy of the receipt and credit card slip for the customer to sign. Mapping and Directions Integrated mapping is a must to direct your drivers. Look for a system that integrates with online mapping, so you don t have to worry about updating mapping data. Multi-stop driving directions and traffic alerts will help you operate efficiently. Street view can give your drivers a preview of what house to look for before they head out. Delivering Success: How Technology Makes Restaurant Delivery A Profit Center 7

Quick Order Recall What happens when the driver has left and the customer calls back for an order update? Your POS system should alert the staff that an existing order is in process, and make it easy to check the status of when the driver left. Modern mapping technology, such as Google s latitude function, lets you easily track where your drivers are at all times. Cash Management Keep your drivers safe by enforcing drops when they get cash payments. Your POS system can help by forcing a drop after every order or when the driver s cash on hand reaches a limit. Drop directly to the safe (which immediately relieves the driver of responsibility), or to an individual driver drop box to be included in the night s shift close. Your delivery software should help by giving you a complete accounting of every order delivered by each driver. Drivers should enter tips they receive on each order as they return. At the close of shift, your software should also tell you the number and types of coupons customers used on the orders. Keeping close track of coupons, including any that were applied after the initial order, is essential as this is a common way for drivers to skim a bit of extra off the top. When it comes to paying your drivers, the most popular way is a flat fee per delivery but you can also pay based on the zone or area they deliver to. Some restaurants choose to pay a higher or lower amount based on whether the driver uses their own car, adds a car topper, or uses a company vehicle. Be sure that your system can handle tracking these options. You may choose to pay based on actual mileage driven but even if you don t, you should track mileage in the POS system. Driver fees are considered reimbursable by the IRS and are not taxable income but if they exceed the allowable amount based on total miles driven, you could be in a tax bind. Keeping mileage records is an important safeguard. Most restaurants pay their drivers the driver fees on a nightly basis, so your POS system should account for this cash outflow. Some, however, choose to pay fees on payroll. If this is how you operate, make sure your POS software can account for this and will report the fees on the payroll report. In some states, you can pay drivers less than minimum wage for the time that they are on the road, Delivering Success: How Technology Makes Restaurant Delivery A Profit Center 8

because of the tip credit. The caveat is you have to pay minimum wage for the time they are NOT on the road. Your POS system should calculate this for you automatically. Tracking your drivers insurance coverage, vehicle registration and driver s license is important. Many software solutions will help you track these expiration dates and alert you if a driver needs to re-verify their information, even preventing the driver from clocking in if the data is expired. This can help you minimize your liability. POS CHECKLIST Automatic tip credit road wage calculation Smart dispatching to recommend order groupings Late delivery alerts Rotate driver assignments Prompts, reminders, labels, and reprints to keep drivers organized Integrated mapping with directions/street view Status check on customer call back Driver accountability for cash Driver security and drops Tracking milage and tips Driver fee methods and pay at shift vs. payroll Driver expirations LOYALTY INSIDE AND OUT Congratulations - you now have all the power you need to become an awesome marketing machine! The side benefit of adding delivery to your operation is that you ve got built-in marketing power the power of your customer database. Because every delivery customer is identified, you know who they are, where they live, and just what they like. All you have to do is put that information to work. Gather Good Email You should consider gathering one more piece of information: the customer s email address. Look for systems that help you collect email addresses efficiently, through integrated rewards programs, for example. Another option is offering email confirmation to the customer of their order an effective way to gather data and service customers appreciate. Market to your database of customers, whether you send direct mail, email or text messages. Great delivery software will integrate with an automated marketing system that takes care of the messages for you, welcoming new customers, rewarding the best ones, and reminding those who haven t been in for a while. Delivering Success: How Technology Makes Restaurant Delivery A Profit Center 9

Segment Your Customers Take advantage of the immense data in your POS system by segmenting your marketing based on items ordered, coupons used, frequency, or time of day ordered. If you can find customers who love your spicy wings, invite them to test your new Spicy Buffalo Chicken pizza. Many restaurant chains spend millions trying to gather this type of detailed customer data you have it at your fingertips! Geography also plays an important role in your marketing. If you ve segmented your delivery area by zone, you ll be able to see which areas are most profitable for you. You can then target those zones with purchased residential lists to reach more new customers who are like the ones that already buy from you. Looking For Loyalty Loyalty or rewards programs are another valuable tool that your POS system should provide you. Customers love to be recognized and appreciated for being one of your regulars. Studies show that customers spend on average 43% more at establishments where they are part of a loyalty program. POS CHECKLIST Marketing features to let you segment your customer base Marketing by item ordered or coupon used Marketing by zone or zip code Integration with automated marketing tools Customer rewards/loyalty Easy way to gather customer emails Customer e-mail order confirmation Delivering Success: How Technology Makes Restaurant Delivery A Profit Center 10

ANALYZE PERFORMANCE Once your delivery service is operational, you ll want to keep monitoring it to see how you can improve. Look for useful reports that help you maintain great service. Delivery Reporting Late deliveries are a red flag that something is going wrong in the kitchen. While your managers should be monitoring the dispatch process to see if orders are running late and adjusting quoted times accordingly (or helping to speed up the kitchen s service), a daily review of a Late Delivery report should be standard procedure. At the end of the night, many restaurants will automatically send out an Oops postcard with a special offer to any customers who experienced a late delivery. Your software can make this easy and convenient right from the Late Delivery report. Driver performance is another important area to review. Your driver performance reports will let you easily pinpoint which drivers are the fastest and which are dawdling on their runs. As a part of your daily marketing efforts, review any new customer records and consider sending them a special thank you. This is a great time to review your staff s accuracy in entering customer data, eliminate any duplicate records that were created, and review any proposed changes to your database. Delivering Success: How Technology Makes Restaurant Delivery A Profit Center 11

Phone Order Performance Evaluating the performance of your phone staff is also key to continued success. Review your reports on ticket averages and sales performance. You can find out which employees are the champs at suggesting appropriate add-ons, and which need more coaching. How do your online orders compare to phone orders? Are you promoting your most profitable add-ons online? Spend some time with your POS system reports to help you constantly improve your business. POS CHECKLIST Late delivery reports with easy customer communications Driver performance reports New customer alerts and reviews Street database maintenance Phone order ticket average / staff performance CONCLUSION In many ways, adding delivery to your restaurant is like opening an entirely new business. You need additional staff, new procedures, and the right technology to help you manage it. For POS, online ordering, mobile ordering, and automated marketing solutions, turn to Thr!ve POS. We re experts in restaurant technology with a special focus on delivery. Learn more or request a demo at: www.thrivepos.com or give us a call at 800-750-3947. Delivering Success: How Technology Makes Restaurant Delivery A Profit Center 12