Building Restaurant Business Resilience In The Face Of COVID-19[/et_pb_text][/et_pb_column][/et_pb_row][/et_pb_section][et_pb_section fb_built=”1″ admin_label=”section” module_id=”about” _builder_version=”4.4.5″][et_pb_row _builder_version=”4.4.5″ custom_margin=”||20px||false|false”][et_pb_column type=”4_4″ _builder_version=”4.4.5″][et_pb_text _builder_version=”4.4.9″]Whilst it is easy to argue that food delivery offerings like Uber Eats and Menulog have kept the doors of restaurants open during the Covid-19 pandemic, the fact is that they remain expensive options for consumers and restaurants, with the bulk of the profit leaving the Redland City.
A new initiative, to be spear headed by the Regional Jobs Committee, is to ascertain whether a locally operated food delivery system can be offered which will reduce the cost to restaurant operators and keep the profits to drivers within the community.
Figure 1: Food Delivery. Image courtesy of Caleb Oquendo from Pexels
Regional Jobs Committee representative Rhett Bowlen said ‘our restaurants have been hit hard by COVID and it can be confusing for businesses to rationalise delivery such as UberEats, Menulog or the like, especially when the average delivery fee ranges from 20-35% of the total sale. He states that ‘in the same respect, businesses are losing a percentage of potential new sales derived from offering the delivery service as a result of the fear of sales cannibalism.’
‘Sales cannibalism’ is the erosion of profits when a business implements a new product or offering. In the terms of offering a delivery service, sales cannibalism can be created with a business’s current loyal customers decide to order via a delivery platform rather than just stopping by in person, or even dining in.
One key point of difference is that the commitee is looking to partner with local not-for-profits with existing links to transport offerings. ‘The offering is two-fold, we are seeking to understand if a more affordable capped delivery option can be offered to restaurants to build their market offering without eroding profits, whilst trying to support a potential revenue stream for our local not for profits’. Local community transport service Star Community Transport is working with the RJC on the project. The committee is also hoping to work with the Council to utilise the existing Redlands Coast app to support the delivery service.
The project will seek to:
- Allow local restaurants to increase their resilience and number of sales without the risk of sales cannibalism as a result of being gouged a quarter of the sales price;
- Ensure the community is being offered a wide range of healthy, locally made food options;
- Maintaining the profits of the delivery service within the Redland City;
- Providing a revenue stream for our local not for profits.
The Regional Jobs Committee says the first step is understanding the level of patronage from the community for such a service, with a questionnaire expected to be released later this week. ‘The RJC hopes to confirm community support for the project given the initiative will improve the profits and build the resilience of local businesses whilst supporting local not-for-profits’. [/et_pb_text][/et_pb_column][/et_pb_row][/et_pb_section]