March 2, 2024

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Eat Your Food

Pros and Cons of offering home delivery

Pros and Cons of Restaurant Online Food Delivery Services | Fridge


Prior to COVID-19, the economics of on-demand platforms led by Uber, Netflix and Amazon Prime, spread to the restaurant industry. Consumers want convenience and practicality in all aspects of their lives, including food.

In the post-COVID world, the demand for home delivery has increased out of necessity and because many brands have jumped on the delivery train. With 6 out of 10 Mexicans ordering food at home. In order to provide this service to their customers, restaurants need to either outsource a delivery service or create their own.

As we see more restaurants reopening in Mexico, demand for home delivery is likely to suffer. But how much? How many people prefer to order to take away V.S. who prefer to go out to eat? Is it still worth investing time and resources to provide takeaway service? Click here for breakfast at home

Because all restaurants are different, there is no one-size-fits-all answer.

In this article, we list all the factors, for you to decide; If becoming (or continue to be) a restaurant with delivery service is the best decision for your business.

Home service trends

In 2017, mobile food applications generated revenues of 13 billion pesos in Mexico.

Before the COVID-19 pandemic, take-out service was the second favorite service in Mexico. According to data from Marketing4Eccomerce, Mexicans used this type of mobile apps per month, with an average spending of $ 700 pesos. It was also observed in 2017 that spending increased in relation to age, with the group of users over 45 years of age reporting the highest spending, disbursing an average of $ 340 per service; while the lowest expense was provided by users under 25 years of age, with an average expense of $ 140 pesos.

The change in consumption habits during social confinement made home delivery apps for restaurants grow in Mexico at triple digits. The Dr. Pizza Restaurant in CdMX, refers that take-out orders used to represent 30% of its total sales, but by the beginning of the third quarter, this figure reached between 70% and 80%.

With the increasing reliance of restaurants on these delivery apps, restaurateurs report that commissions have become unsustainable, some apps retaining up to 30% of the restaurant’s daily revenue. That is why many restaurateurs have considered developing their own delivery network and home ordering system and investing the percentage of commissions to new salaries (cooks, delivery men, etc.).

If you do not work with an app to provide food delivery service, nor do you have your own system, you are missing out on a juicy slice of the market. Income from home services does not seem to be going down. Diners continue to demand takeout food, through apps or directly from the restaurant. Your first step will be to evaluate what your options are and determine what works best for your business.

The rise of Ghost Kitchens

Home delivery in restaurants has had a great impact on the restaurant industry and has accelerated the development of new restaurant schemes, the Dark Kitchens.

Also called Ghost Kitchens, Dark Kitchen or Hidden Kitchens; they are shared kitchen spaces or co-cooking. This is one of the alternatives that the restaurant industry has taken; They are restaurants that only offer takeout or delivery meals, since they do not have a dining space. They usually operate in commercial kitchens and their purpose is solely to prepare food and complete take out orders; as opposed to offering the full experience of eating in traditional restaurants.

Since much of the dining areas of the restaurants were temporarily closed in previous months. Las Cocinas Fantasmas, have taken this opportunity to shine in Latin America and offer diners their favorite dishes safely as well.

Although the Ghost Kitchens already existed in Mexico, prior to the COVID-19 outbreak, experts indicate that the pandemic accelerated the creation and expansion of these businesses throughout the country. Providing restaurants with a more sustainable business model, to respond to the growing demand for food at home from diners.

With that being said, you don’t have to run a Ghost Kitchen, to profit from the food delivery business.