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Restaurants Shrink as Food Delivery Apps Get More Popular (bloomberg.com)
People are still eating restaurant food -- they're just not doing it at restaurants as much. From a report: Delivery apps from DoorDash, Postmates, GrubHub and UberEats have made ordering in easier, and have changed the way food chains think about their business. The number of food delivery app downloads is up 380 percent compared with three years ago, according to market-data firm App Annie, and research firm Cowen and Co. predicts that U.S. restaurant delivery sales will rise an average of 12 percent a year to $76 billion in the next four years. At Firehouse, revenue has increased 7 percent this year, mainly from orders placed online and through delivery apps, Fox said. More than half of his sales are for food eaten elsewhere.
[...] Some new restaurant owners are skipping tables and chairs altogether and just leasing kitchen space to prepare food for couriers. Those are called cloud kitchens or virtual restaurants because they have no dining rooms or wait staff and sell their meals through the internet and mobile apps like DoorDash or UberEats. Mark Chase, the founder of Restaurant Real Estate Advisors, a consulting group that helps restaurant entrepreneurs find space and negotiate leases, said that the majority of his clients are interested in the kitchen-only business model. "There is a general scaling down on seating space and scaling up on kitchen space, as people just want to eat at home, on the couch," Chase said.
[...] Some new restaurant owners are skipping tables and chairs altogether and just leasing kitchen space to prepare food for couriers. Those are called cloud kitchens or virtual restaurants because they have no dining rooms or wait staff and sell their meals through the internet and mobile apps like DoorDash or UberEats. Mark Chase, the founder of Restaurant Real Estate Advisors, a consulting group that helps restaurant entrepreneurs find space and negotiate leases, said that the majority of his clients are interested in the kitchen-only business model. "There is a general scaling down on seating space and scaling up on kitchen space, as people just want to eat at home, on the couch," Chase said.
To a lot of us, a place like Firehouse is not exactly what we would call a 'restaurant'. I suspect it's mainly younger millennials that are reliant upon apps, and their tastes and proclivities will change. It's never a good idea to base business longevity on fads.
"Those are called cloud kitchens"
So.... because someone uses a phone to order delivery food, it's a cloud kitchen?
I am no liberal sympathy-monger riding on the bandwagon of local / artisanal / anti-gentrification / etc that thinks that all technology is bad. But the issue of how local restaurants are surviving is one that has hit home more than others. Specifically, how a lot of small restaurants, "mom-and-pop" to shorthand it, are at the mercy of middlemen, essentially who are extracting the profit out of the industry.
Small restaurants have never been great at marketing, being super efficient in delivery, or getting rewarded with outsized profits for the service they provide, and now this layer of tech middlemen has come in to squeeze out the profit even more.
I read the story about how Doordash and their ilk (I forget the specific service mentioned in the story exactly, but similar ordering service) basically takes over a restaurant's phone number, publishes it and diverts and monitors their calls to make sure they're paying an agreed % cut of every order. Even if Doordash did essentially nothing value adding for that order. The customers don't know anything different -- they're just ordering from their favorite restaurant using a convenient method.
So basically the restaurant and its workers become a labor slave to Doordash because customer traffic has been channeled through Doordash, even though the restaurant has enough patrons to exist on its own. They pay a cut for people being able to press a button and have food appear, rather than walk down to the restaurant, or call the legit restaurant's phone number.
So, how is the small guy ever to overcome the power of tech companies in a situation like this? Or how can you ever turn a profit as a small company when tech talent is out there to squeeze you as soon as you do?
Pretty soon, I could imagine that we'll just become a country of order takers from some tech overlords, and be dominated by flavorless food dictated by corporate efficiency recipes. It's a little disturbing.
I *like* dining in a restaurant. If it's not busy, I'll even bring my phone and headphones and watch some Netflix. It's relaxing and sometimes you meet others. And it's a good reason to go for a walk outside of the house.
I suppose this attraction to dining rooms will be a reason for my eventual grandchildren to call me old. Harumph!
Fast food? Yeah I'll have that to go.
Mediocre chain establishment? I'll have that to go.
Trendy fashionista place that serves kale and rabbitfood with a side of pretentious? I won't even spend a dime there, but if I had to, it'd be to go.
Family-owned restaurant one has been visiting for the past 10 years? Nope, I'll make time to go there, have that glorious just-brewed tea, nod to the chef and without a word, food magically appears, to my taste, and eat while watching the kitchen do their thing.
Not every restaurant deserves going to. Those that do... treasure them and treat them well.
The "Civilized World" jumped the shark ca. 1973.
http://www.al-awa2el.com/%D8%AA%D9%86%D8%B8%D9%8A%D9%81-%D8%B3%D8%AC%D8%A7%D8%AF-%D8%A8%D8%A7%D9%84%D8%B1%D9%8A%D8%A7%D8%B6/235-%D8%B4%D8%B1%D9%83%D8%A9-%D8%AA%D9%86%D8%B8%D9%8A%D9%81-%D8%B3%D8%AC%D8%A7%D8%AF-%D8%A8%D8%A7%D9%84%D8%B1%D9%8A%D8%A7%D8%B6
iPhone users must have just received another update....
I'm sitting in a restaurant in NYC now, crowd is plenty diverse and I don't see anyone chimping out or spitting on each other. I think you're just a fuckin' coward.
I'd like to sit at a table. Welp, guess I'll have to cook my own food then.
Is this really how you would choose to live, if you were free?
The cost overhead of the delivery places makes them not worth bothering with, especially if a $12 food item turns into a $36 food item, which is now lukewarm after sitting in a delivery vehicle for 30-90 minutes due to traffic.
I rather just go someplace and eat out, or I might do something unheard of... and cook stuff.
"Cloud kitchens". Definitely not a new concept. There have been places doing to-go stuff for years.
lol
I will admit that I have taken advantage of the fact that many fast food places make it easy to order online - I’ve done that many times (although I generally pick it up myself).
But I also like the social nature of restaurants. It’s fun to share a meal with friends, sitting around and laughing, watching people walking by outside, etc. I can’t imagine always “eating in” - that would be sad and boring.
#DeleteChrome
So.. pay restaurant prices (that includes the artificially inflated price to pay for a dining space), plus pay around 50% of that food cost in terms of a delivery fee/tip... it's no wonder why they want to move to that direction.
Going out to lunch, going for a nice walk, and sitting down for 45 minutes is seen as anti-social and unproductive. After all, you could be working more and having lunch at your desk like a good little worker-bee.
I go to restaurants because I like the experience. Some I go to because they're small shops where the owner is the guy in the kitchen cooking my food and waves to me.
My favourite restaurant is one my wife and I will only go to 2-3 times a year, because we're going to sit and have several courses, drinks, and desserts and then walk home. But the head waitress knows us by name, and the chef/owner is 10 feet away making my food and occasionally chatting with me, and will happily tweak dishes within reason for our tastes.
I have no intention of letting these tech companies be the ones getting the money, and I've even heard in a few cases restaurants have stopped supporting Uber Eats because Uber didn't pay them, or that the Uber driver is stealing the food.
No thanks, I'll support local business, and not some douchy tech company in California. Bummer for the Uber drivers who are essentially making nothing, but that was never viable economically and not my problem.
My hard working waitress who brings me fresh beer, smiles, and checks in on me ... I'm far more interested in making sure she gets a nice tip, because she's probably been friendly to me and recognised me and made sure I had a good meal -- and I'm old enough to place value on that.
I have an affinity for the service industry, because unless you're an asshole, there's lots of nice, hard-working people who do their best to give you a good experience. They deserve the tips and everything else, not Uber.
I just hope this idiotic 'everything is an app' culture doesn't keep wrecking the good bits of our actual culture.
and who pays when the 1099 driver gets in a crash? and there auto insurance does not pay as they don't don't cover Commercial use?
Not to mention the noise. 24 hours a day of boxes tearing open, the awful slurping munching noises interrupted by throwing up, only to start again within seconds.
lot's of pizza places are pickup / delivery only with maybe an very small seating area for waiting.
Watch out for the value-added ingredients like Cialis, Viagra, & thallium.
I *like* dining in a restaurant. If it's not busy, I'll even bring my phone and headphones and watch some Netflix.
I must say, you are a total weirdo. You will not have grandchildren because you will surely die a virgin.
I'm pissing in your soup in the kitchen whitey
How do you meet others if you are watching Netflix?
Now I feel old.. I can't even imaging going to a restaurant and watching TV on my phone.. with headphones on... like.. WTF?
This is a pretty damn cool development, for people in their own city. How can any restaurant be even 1% as nice as your own hovel? OTOH I can see how tourists would hate it. Hotel rooms ain't home.
Good point: pay restaurant prices plus the delivery markup to eat on your couch? Unlike the mall movie experience, the restaurant experience is still much better than being at home.
Agreed. There are a few places I'll specifically go to because the atmosphere is great, or because the employees are awesome, or because it has an awesome view or whatever.
But I'll be honest - I just checked, and there are 12 different indian places on my Uber Eats list. I don't feel like driving 20 minutes across town to buy some food from one of these random places. Not to mention, my average delivery tip is $4, plus an average delivery fee of $3. I typically end up tipping at LEAST that much when I go to an actual restaurant... so why would I ever go to an actual restaurant? More expense for the same food in a less comfortable location predicated by a 20-30 minute drive? (not to mention, I can only have one beer because I still need to drive home). Yeah, aside from a few exceptions, there's no good reason to bother with it.
There's a reason these things got popular, and it's because going out to most restaurants isn't a great experience.
But what bothers me is the fact that ANYONE uses the ones that make you tip *before* the actual food arrives. It'd be like walking into a restaurant and tipping your future waitress. Uber Eats is the only one that doesn't do this in my experience, and once I discovered that, I deleted the other apps and never looked back. What a ridiculous layout. Who puts up with that!?
Diversity brings distrust
If you're a total asshole, which we could gather by your use of the phrase "chimp-out."
sounds interesting but I hate to see the menu prices and the delivery charges then you need to tip. could get expensive. Personally I like going to restaurants and eat. it is good to have young pretty ladies talk and pay attention to me since I have gotten old and fat. Yea, I know they are only doing it for tips but still...
Seriously, you find kale pretentious? Isn't that a little pretentious?
Frankly, I hate the stuff, but I can't wrap my brain around acting superior to someone who does.
Post may contain irony: discontinue use if experiencing mood swings, nausea or elevated blood pressure.
If a group of millenials go to a restaurant, sit, order and wait for their food, with all that down time, they might be forced to socialize and talk to each other at the table. Sure, if they had the cell phones, they still wouldn't need to, but why go to a restaurant where they could do the exact same thing without that experience?
I like you :)
Once most restaurant food gets cold, there's almost nothing that can salvage it. Door to door delivery service has the main problem of food getting cold fast. When you are at the restaurant, at least the food has a better chance of being piping hot.
It's like poke, or frozen yogurt, even this "food app" is a fad that will die off as the Millennials complete household formation and run out of cash to waste on food delivery that costs that much.
The smart ones will be buying meal recipe fridge/stoves that order all the components for their picky kids to eat, and cook their food at home from updated recipes. I call it Homer Cooking (tm).
-- Tigger warning: This post may contain tiggers! --
Who the fuck cares. I don’t give a flying fuck about the driver. Who brings me my food when they crash?
Was thinking the same thing....why pay restaurant prices, delivery charge, etc....to eat in the "ambiance" of your kitchen....a major part of dining out is actually dining out
I live in two cities. One is wealthy. One in poor. In the wealthy city, people love to go out to eat. In the poor city, nobody goes out to eat.
It's really sad to see so many empty restaurants in this big city, and delivery people just taking out styrofoam boxes all night. It's sad. These people generally don't leave their houses. Walking around is unheard of (it's a very walkable big city). I don't where or if most people in this city socialize very much at all. I imagine they work all day, then come home and want to keep staring at a little screen all night because they're addicted, like most of their friends and family.
In the rich city, people like going out to eat. It's fun. You get to eat good food. You get to talk to friends and family. I'm kind of thinking that people in poor areas just don't do that anymore. The screen addiction is kind of insane there.
I don't respond to AC's.
Seriously, you find kale pretentious? Isn't that a little pretentious?
No, kale in and of itself just is. It is incapable of demonstrating emotion or .. anything.
The joints I've been to that make it a central part of "who they are" I find unbearably pretentious. They didn't waste any time in rubbing in how better life is *their* way vs the "normal" way.
So I stick to places that just serve delicious food without judgement or sermon.
I only visit the pretentious kind when I'm with coworkers of a certain culinary persuasion anyway. It's not by choice, it's out of politeness, and frankly, some of the food *is* quite nice. Just.. lay off the sermonizing, be it active by the staff, or passive by decor.
The "Civilized World" jumped the shark ca. 1973.
the restaurant experience is still much better than being at home.
Try that same experience with young children, and I guarantee you will rethink that statement.
Before kids, yes you are right on the money.
This applies even to chain restaurants. Some are pick-up only. And then there's the take-and-bake variety.
I see it purely as a growth market, and what's shrinking is the time people are willing to spend preparing their own meals. When new "restaurants"(I prefer to call them food delivery services) open with little or no eat-in, this has little impact on those that want to go out with family and friends, enjoy a nice meal and have a couple of drinks. Every local restaurant I've talked to refer to the doordashes and foodoras of the world as a necessary evil. Many of them won't offer food to them at peak hours, simply because they can't keep up. That means they're being successful serving patrons, they aren't disappearing.
It's about time management - it's becoming more and more precious(justified or not), so this will grow. Exhausted workers getting home late that just want to eat weren't going out anyway. For a bit more money they get yummies delivered rather than doing it themselves.
I don't go to restaurants any more for the same reason that I don't go to movies any more: it's an expensive yet unpleasant experience. In most cases, the product sucks, too. And in addition, it's generally unhealthful.
...I can still get my favorite programs without paying my (monopolistic) cable provider's rates?
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