Takeout Offers Restaurants New Venues for Profit
A ritual is playing out across America, in cities big and small, in sprawling suburbs and college campuses, like it never has before.
It’s takeout and it’s taking off, fueled by the growth of third-party delivery apps such as UberEats, Grubhub and ChowNow. Restaurants that don’t maximize their to-go potential are missing out, and it’s potentially a life-or-death consequence, operators say. That’s because by 2020, 70 percent of restaurant traffic will be offpremise dining, according to the National Restaurant Association.
“I was skeptical at first,” says John Shapiro, the CEO of Torrance Tavern, a neighborhood restaurant in Torrance, California. “Our to-go revenues were insignificant. However, this was a whole different segment of the to-go business, the to-go-delivery business. UberEats took off from day one with sales increasing quickly.”
Large chains are already shifting to take out and delivery as the antidote to sluggish store sales. In the last few years, casual dining chains have been focusing on infrastructure to ensure quality and speed, from Red Robin and Panera Bread to Brinker International’s Maggiano’s and Darden’s Olive Garden. And they’re seeing results.
Independent restaurateurs, such as Shapiro, also are experiencing increases. Their percentages of off-premise sales are entering double digits and often account for more than on-premise dining. They attribute their success to factors such as solid infrastructure, menu portability, packaging and delivery that matches core customer needs and exceeds expectations.
Be at the Ready
Parker’s Barbecue accepted only cash since the first location opened in Wilson, North Carolina in 1946. But when Billy Parker opened his third location with a drive-thru, he started accepting credit cards. Imagine, he says, the logjam of cash only.
Parker also knew the takeout portion of the business would increase at the new Greenville, North Carolina, location because of its proximity to East Carolina University. He reached out to associates in fast food to help prepare and equip staff on handling volume and larger orders that come with tailgating parties. Speed increased by the configuration and positioning of food and packaging along with added staff equipped with headsets to communicate.
“We’ll do 400 orders in two hours and that may not seem like a lot for fast food, but we are serving full-size meals,” Parker says of his signature barbecue pork and classic Southern sides of Brunswick stew, hush puppies and corn sticks.
Minding the Menu
Ensuring that the quality of delivered food is as close to dining on-premise will set restaurants apart. Consider french fries: hot fries rock. Room temperature ones? Not so much.
“The critical factor, not just for fries, but for all of the to-go-on demand items, is the coordination between the ticket time and the pickup time,” Shapiro says. “You don’t want your fries sitting in a sealed container under a hot lamp for 10 minutes before it’s even picked up for delivery.”
Still, not every menu item is a sensible to-go option. In such cases, it makes sense to adapt and “enhance the travel ability,” Shapiro says. Separating components of a dish often solves the problem. For instance, the a la mode part of a dessert travels solo in a cup versus on the dessert.
It’s All in the Packaging
Portability can often be addressed with packaging.
“Packaging is critical for to-go dining success,” says Mike Clock, president and chief financial officer of Newk’s Eatery, a Jackson, Mississippi-based casual dining concept with more than 100 restaurants in 13 states. Insulated packaging specifically designed to keep foods hot is used for pizza and soup while containers designed for cool foods hold chilled salads and dressing,
“Packaging features like good, tight seals help keep a consistent temperature for our to-go items and maintain the integrity of the food,” Clock says.
Operators with strong takeout sales (Parker’s 66 percent; Newk’s 40 percent) say spending more in packaging is worth the cost. They work the price into the overall food cost.
“Investing in containers that maintain the integrity of the food is always worth it because our top priority is that Newk’s on-the-go dishes match the taste and experience our guests have come to expect in our restaurants,” Clock says, adding that consistency builds loyalty. Quality packaging is especially important with bulk orders.
“We tweaked the way we package the food,” Parker says. “With bulk orders, say for a tailgate, we have really thick containers that are sturdy and will keep the integrity of the food over a long period of time.”
Shapiro agrees. “We will also spend a little more on environmentally safe packaging and try to avoid plastic wherever possible.”
Which Way To-Go?
Figuring out the delivery part of takeout depends on the concept and its goals. Shapiro added DoorDash, also an online delivery service, after the success of UberEats (overall sales increased 40 percent from 2016 to 2017). Using both options extends the restaurant’s menu to more potential customers. He is also considering ChowNow, a service that integrates with a restaurant’s point of sales system and provides metrics on customer preferences and other data that assists with marketing efforts.
Newk’s established call-in centers, created an online ordering app and offers curbside pickup.
“We see the opportunity presented by the growing demand for to-go dining, and the providers rushing to fill the need,” Clock says. “We are currently pursuing partners for third-party delivery, though we plan to build out the Newk’s ordering app to manage the orders and dispatch.”
Operators agree that customer service extends to people’s homes. When an item is overlooked at Parker’s, staff will drive it to the customer’s location. Flawless execution, hence, is the Holy Grail. “That means that their orders are ready on time, that they are fulfilled correctly and that every item tastes just as good at home as it would in the restaurant,” Clock says.
The Right Fit
The quality of takeout containers needs to match the concept. Pricier food dictates higher quality packaging. However, integrity of the food must be maintained no matter the price point.
Also, cold and hot components need to be separated. For example, don’t package a caprese salad alongside grilled chicken.
Consider the following:
For lighter items and lower price points; foods that do not need to stay hot, such as dips or cold salads.
Entrees with sauces, such as pasta and proteins, and dishes with different components meant to be eaten together. Recyclable and post-recycled packaging has made inroads in recent years, which has lowered pricing.
Salads and soup, lighter entrees, appetizers.