The Daily Rail: Are Restaurant Partnerships with GrubHub & UberEats a Big Risk?

MARKETING: Top 4 Marketing Challenges of a Restaurant Manager & How to Overcome Them

Restaurant managers have a lot to juggle with their business, including marketing. Here are the top four marketing challenges every restaurant manager faces, and tips for overcoming them.


Can We Believe Things Again?

April Fools has come and gone (thank the gods) and restaurants couldn’t resist but try to leverage the day in their marketing efforts. Here’s what some restaurants did to jest with their guests & followers. Did you do anything fun for April Fools? Let us know!

Tim Horton’s New Prototype

Tim Horton and its Canadian franchises are dropping more than $540 million on remodeling by 2012. They’ve been working on a new interior design prototype that includes communal tables with bar seats, a more open concept, and softer lighting. Check it out here.

China Not Impressed with McD’s Coveted Szechuan Sauce

While Rick and Morty fans salivated at the thought of McDonald’s Szechaun Sauce being released, China is a bit more luke-warm. To be fair, the US reviews weren’t great when the sauce was re-released, and China seems to be in the same boat. “Is this really the chile sauce that the Americans go nuts about? It’s not spicy at all,” one review said. Ouch.


Why it matters to you: Partnerships with GrubHub and UberEats increase risks and lower profits for restaurants.

Ordering delivery is great for guests. They get exactly what they want, when they want it, delivered to their door. Also, everyone uses Uber now, right? It only makes sense that restaurants would try to use third-party delivery systems to increase their reach while keeping the overhead to a minimum. This all makes perfect sense until you factor in that these delivery programs collect between 15% and 30% of the sale on their end. Factor in the labor cost of making the dishes, and operators are only pulling in about 75% of what they’re charging. Right now, this need to make one sale cannibalizes the other and leads into a lose-lose world of lower margins and no control. Factor in your restaurants’ overheads and you finally have a true picture of what we are dealing with here.

So, what is the solution here? Is there one? One alternative for operators are jacking up your third-party delivery menu costs which comes with its own set of pros/cons. You could also go old school and run your own delivery team and make sure it’s at the top of its game. This cuts out one of the biggest flaws of the third-party delivery services -- lack of control. Operators have no insight into who the drivers are, how they handle the food, the length of time it will end up taking, etc. when using GrubHub or UberEats. We like what Texas roadhouse said about the third-party apps the most as a solid summary:

"We encourage all our competitors to do as much delivery as they can, so they can deliver lukewarm food to the people who order it," CEO Kent Taylor said last year.

We couldn’t agree more.



Why it matters to you: Reservations always matter but diners don’t always know that.

Many diners believe if they miss their reservation it isn’t a big deal. We all know that could not be further from the case. No-showing a reservation always means lost money; it doesn’t matter if you are busy or not. A group not showing for their reservation in a busy place means an empty table is sitting there while hungry and impatient diners stare at it. Not only do you lose the no-show business, but you run the risk of losing the diners waiting, as well! Reservations are always important but diners simply do not understand what goes into an average night out at a restaurant.

Apps like OpenTable have historically helped but can only do so much. You need the intuition of a real-life person to keep up with the juggling act of hosting of a restaurant. A new app called Reserve has been gaining some steam, they have been doing so because of a stronghold on the cool-kids. They’ve gone after the trendiest restaurants for partnerships first, though there is no real word yet on whether or not their platform is any help in the field of shuffling reservations.

So, is there a cut and dry solution? Not really. No-shows might always be a part of our restaurant culture, sadly. Some restaurants have started charging (refundable) reservation fees, while others have took to social media to shame their no-show guests. You can try to inform your guests (and social media followers) of the impact of no-showing, but it can be tricky to do without coming off sounding like you’re whining. Being stuck in a flawed system sucks, huh?