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Take Out Delivery Service

 

Many restaurants have a delivery service, but not all of them. From a consumer's point of view most of us will not keep an infinite number of menus at home, but tend to keep a few menus in a drawer or stuck on the fridge in case we want a take out. When I lived in Hong Kong there was a very successful service called Food by Phone which pulled together all the menus into one catalogue, dropped them door to door and allowed you to order from more than one restaurant any time you wanted to eat.

Think about that, you're sitting at home ready to watch a DVD, father wants pizza, kids want McDonalds and mum is in the mood for a curry. No problem you pass around the book, make a call and you all get the food of your choice.

 

Lets assume that there is no such service in your town. If there is then you immediately run into a problem. If there isn't then you may well be in business. You need to either charge a delivery fee, or take a percentage of each menu item in order to make money. Unless you plan to do all the deliveries yourself you should not factor in tips. You need to decide on your starting delivery area, and then find restaurants that are convenient to that area (your delivery staff may have to visit 2 or 3 restaurants each trip) and start to collect the menus.

Put together a dummy menu catalogue (a home computer and colour printer should be sufficient for this) and then try to get appointments with the managers of each store. If you target independent restaurants then you may well be able to get a %age of the sales, if not then you will need to charge a delivery fee (say 10% with a minimum order of $10). You should also agree with the owners/managers who is responsible for prank calls, and no-pays as they will happen from time to time.

If you can get half a dozen different types of restaurant to participate then you are ready to test your market. Drop the menu catalogues at all the houses for a couple of streets. Note that if you live in a high rise area a couple of buildings are enough for your test.

Make sure that you have someone to cover the phones, as well as someone to do the deliveries. As with most food delivery services motor scooters will be more fuel efficient and better at handling traffic than cars. You may be able to find delivery staff with their own scooters if you advertise, if not then you may need to buy or lease some.

 

Your stock will come from other people's restaurants. Finding the first 5 or 6 who will be willing to play along will be tough. Once you are up and running and people are talking about your service the others will want to join your service. Ultimately you will bring them more sales at no additional marketing cost.

Because you (or your people) will hand out the catalogues by street location you can choose to have 2 or 3 different versions of the catalogue and possible even 2 or 3 office locations. This will depend largely on traffic and how spread out your town or city is. You may also find that in one part of town people prefer one kind of cuisine whilst in another part of town that type of food does not sell. This can be because of racial or cultural variances but may warrant you having a special version of your catalogue with additional restaurants catering to the specific requirements of your customers.

 

You can test this business literally with 2 people, one to deliver and one on the phone. The money is in how big you can build it, because you earn off of every successful delivery. There are also spin off money earners if you get big enough such as selling advertising space in the catalogue.

This business can definitely be run part time. Start deliveries at 7pm and finish at 11pm and it should not interfere with your day job, you can use students to staff it, and in all likelihood your bosses will be your customers very soon after you start.

Before you start you will want to understand whether this is worthwhile. It may be that your minimum order size needs to be $20 before it makes sense, or that your delivery staff work only for tips. You have minimal overhead but will need 2-3 phone lines and depending on where you are based you may need to provide transport for your staff. If you are unsure about the numbers then ask a more mathematical friend to help you run them, or involve your accountant as it could save you getting the economics all wrong.

You will have to deal with customer complaints. Your staff and the restaurants will forget items, and will make mistakes. Be sure that you or your telephone staff deals with this professionally.

© 2007 HK Business Angels Ltd.