Houston restaurant says Uber Eats owes more than $20,000 for hundreds of orders
CHEERS: Houston drank more at the airport than anywhere else last month
Emily Garcia, who manages the restaurant for her father, told FOX Business that the orders total up to at least $20,000.
"We really weren't expecting one of those issues to be with… a third-party delivery company that is supposed to actually make our lives easier for us," Garcia said, Fox Business's Daniella Genovese reports. "They're supposed to bring in, you know, new customers for us."
Garcia told Fox Business that she found the payments weren't going through, then updated their bank information with the service.
The restaurant posted on Instagram that it has been in "constant contact" with Uber Eats, but still hasn't reached a resolution or learned when the restaurant will receive payment.
Meanwhile, Uber Eats says it has been trying to resolve the issue with Birria Los Primos, but that the service is missing information from the restaurant, according to the Houston Chronicle's Monique Welch.
"Periodically, Uber needs to request basic information from our merchant partners (including D.O.B., legal name) in order to satisfy legal and regulatory requirements of payment processing," Uber Eats representative Javier Correoso said, according to Welch. "This is part of our Merchant Terms and Conditions. We have spoken and emailed with the owners of Birria Los Primos this week to clarify the information needed to verify their account and process their payment immediately; they have declined to provide this information. We will continue to make every attempt to resolve this issue."
COMING SOON:Houston's newest restaurant combines good vibes with Cajun spice
But Garcia says no other third-party service requires personal information like that, according to Welch.
Birria Los Primos thanked customers for their support in another Instagram post and asked them to continue holding the company accountable.
"[Uber Eats owes] it to all the small businesses that have kept them afloat during the pandemic, as well as the customers who use their services," Birria Los Primos' post said.
Why Uber Eats and GrubHub partnerships are risky for restaurants
Today, you can get just about any kind of food delivered to your door.
That's great news when you're hungry. But delivery can be a risky bet for restaurants.
To reach customers, gain exposure and build a new channel for sales, restaurants that can't deliver food on their own are signing up with third-parties like GrubHub(GRUB), Seamless, Uber Eats, Postmates and DoorDash.
Americans want their food brought to them at home or the office, and restaurants don't want to miss out. National chains sense an opportunity to grow revenue and are now racing to team up with outside parties, too.
McDonald's(MCD) partners with Uber Eats. Dunkin'(DNKN) uses DoorDash. Pizza Hut, KFC and Taco Bell parent Yum Brands(YUM) took an ownership stake in GrubHub last month. Chipotle(CMG), Red Robin(RRGB), Jack in the Box(JACK), Cheesecake Factory(CAKE) and Outback Steakhouse(BLMN) also rely on apps.
Related: Supersize your takeout: Seamless and GrubHub merge
But these relationships are in their testing stages and can carry unexpected risks, including shrinking profit margins and shifting customer allegiances.
"It's difficult for a restaurant to just flip on the switch," Stephen Dutton, an analyst at Euromonitor International, said. "Navigating the best way to get involved in delivery is a big challenge."
Turning a profit in the food business is tough.
Partnering with delivery aggregators squeeze margins even tighter.
Restaurants pay the services 15% to 30% fees for each order customers place through their platform. "It is a very large expense for the restaurant chain to absorb," said Jeffrey Bernstein, an analyst at Barclays.
Customers are also less likely to ask for menu items that carry higher margins -- including soda and alcoholic drinks-- when they order in, cutting deeper into profit from delivery.
Domino's(DPZ), the industry's in-house delivery leader, has argued the third-party model is "problematic" for restaurants. Domino's charges its franchise owners just 1% for deliveries.
Related: Why Domino's is winning the pizza wars
Olive Garden agrees that the equation doesn't work. "We're not willing to give up 20% to 25% just to get a sale," Darden Restaurants(DRI) CEO Gene Lee said in January.
Restaurants risk cannibalizing their more profitable dine-in sales by encouraging customers to stay at home.
Party sizes tend to belarger when customers come in to eat and restaurants don't have to pass off a cut to a third party.
Restaurants say orders that come through aggregators are "incremental" -- sales they wouldn't have gotten otherwise.
McDonald's has reported around 70% of orders on Uber Eats are incremental. Delivery has created new occasions and different times of day, especially late at night, for people to eat McDonald's.
Related: McDonald's to launch ordering app, expand delivery
Sara Senatore, an analyst at Bernstein, said third-party platforms were a cheaper form of marketing and a great way to acquire first-time customers.
But restaurants' returns start to diminish as those new sales become repeat orders through the platform. "It would be much kinder of you to just pick up the phone and call the restaurant" so the operator can avoid paying a commission, Senatore said.
It's even worse if customers decide to replace going out to dinner entirely with ordering in, Stifel analyst Chris O'Cull added. He believes restaurants will start to scale back on third-party relationships if they're cutting into higher-margin dine-in traffic.
Integrating third-party delivery into kitchen operations can be a logistical nightmare.
Employees need to be trained how to store, cook, package and handle the food so it arrives at customers' homes hot out of the oven. Delivery services work with several restaurants at a time -- including direct competitors -- and there's no guarantee for the restaurant that their food will be the first stop on the driver's route. The clock is ticking and they can't afford to get it wrong.
If the order takes longer than expected or if the food comes cold and soggy, customers will have a "tarnished image" of the brand, Barclays' Bernstein said. Instead of blaming GrubHub or Uber Eats for the disappointing order, they'll fault the restaurant and may not return.
Related: Grubhub will deliver KFC and Taco Bell. Its stock is soaring
That's why Texas Roadhouse(TXRH) is reluctant to turn to third parties: "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.
Customers also may write a negative review about the wait time or the food, discouraging other people from trying the restaurant, noted Erik Thoresen, a principal at research firm Technomic.
Customer loyalty shifts away from the restaurant to the delivery service in third-party partnerships.
"The relationship changes because the restaurant is now one step removed from the customer," Thoresen said. People are "going to a site where they can potentially find something else that's new and interesting."
Analysts also question who controls the customer data on third-party transactions. Restaurants are not able to tailor marketing and roll out new promotions effectively if they don't get those order histories, email addresses or cell numbers.
"You want to know who your best and most loyal customers are," said R.J. Hottovy, an analyst at Morningstar. "You have to make sure you have access to that data."
How to avoid pitfalls
If a restaurant decides third-party delivery is the best way to boost sales, analysts say they can take steps to build a happy marriage.
Restaurants need to negotiate low fees with aggregators to prevent delivery orders from eating into margins and reach data sharing agreements to gain customer insights.
Bernstein explained that restaurants should work with third parties to understand which foods travel well and ensure they are getting priority along drivers' routes.
Full-service operators must "protect occasions they really care about" and "create great experiences around them" to attract diners and defend themselves from the threat of cannibalized sales, said Eli Portnoy, founder of Sense360, an analytics firm that works with companies.
To guard against customers swapping out profitable dine-in meals, restaurants can limit delivery to off-peak hours -- late nights, mid-afternoons and early mornings.
"If you get the munchies at 10:00, and you want to order delivery, there's a good chance that's incremental," O'Cull said.
CNNMoney (New York) First published March 28, 2018: 9:44 AM ET
If you held out on partnering with a third-party delivery service pre-COVID, the pandemic may well have prompted you to rethink your position.
Uber Eats and similar services have long positioned themselves as a way to boost sales and increase your visibility. And they’re an integral part of the recent rise of ghost kitchens and ghost restaurants.
But they also come with some downsides that may make them a less attractive prospect for your business. Learn more about the pros and cons of these delivery services, as well as some of the benefits and drawbacks of the top companies in this industry.
The Pros and Cons of Third-Party Delivery Services
Regardless of which service you partner with for delivery or online ordering, there are some pros and cons of the business model that you should consider before signing up.
The Pros of Outside Delivery
Apps Provide Helpful Marketing Options
These delivery platforms can be great marketing tools that connect your food with hungry people in search of a restaurant nearby.
Offset Losses From Closed Dining Rooms or Reduced Capacity
With people dining at home more than ever, offering food for delivery or pickup can help make up some of the reduced sales that restaurants have been facing during the COVID-19 pandemic.
Make Delivery An Option to More Restaurants Than Ever
Salaries and insurance costs have made delivery unfeasible for many restaurants in the past. By partnering with Uber Eats or a similar provider, you can deliver your food without taking on the expense of hiring your own delivery fleet.
Use the App, Not the Drivers
If you do have your own delivery drivers, you can use these apps strictly to facilitate orders. This reduces your commission fee, and still lets you take advantage of the marketing benefits.
POS Integrations Are Improving and Expanding
When these platforms first came out, restaurants had to use a separate tablet for each delivery company to manage their incoming orders. And they had to figure out how to get those orders from the tablet to the kitchen efficiently.
But these days, delivery companies have integrations with many point-of-sale (POS) systems, which removes the need for the intermediate tablet. If your POS can’t integrate with the app, tablets are still an option.
The Cons of Outside Delivery
Lose Control of the Guest Experience
Third-party platforms like Uber Eats and GrubHub put an intermediary between your restaurant and the customer. You’re no longer in control of the interaction—-the app company is. Plus, delivery/takeout food removes the other important aspects of great dining, like ambiance and good service.
Customers Can Blame the Restaurant for Bad Delivery
Customers who have a bad delivery experience often don’t know exactly how these platforms work. All they know is they ordered food, and it never arrived, or arrived cold. They may then blame the restaurant, even though the actual breakdown happened with the driver.
And when there is a problem, customers may be confused about who to contact to resolve it. It’s much easier to contact a human being at your restaurant than at Uber Eats, so you may receive phone calls about driver errors that you can’t resolve.
Less Opportunity For High-Profit Add-Ons
Sodas, wine, and cocktails are often high-margin items that can be a big boost to your overall profitability in the restaurant. Sodas and spirits are added to online orders less frequently, since people often have drinks at home. Plus, many states prohibit alcohol delivery to prevent access to minors.
The Fees Can Be Steep
Third-party restaurant partners charge fees to both the consumer and the restaurant. On the restaurant side, these amounts can be steep—-as high as 30% per order, before any discounts you may choose to offer.
Some restaurants report raising their prices on the delivery platforms in order to offset this cost. So a $10 sandwich in the restaurant would cost $12 or $13 through a delivery app. But a lawsuit filed in 2020 alleged that GrubHub, Uber Eats, and Postmates are prohibiting restaurants from charging lower prices in their restaurants or on other delivery apps. So read that contract carefully before signing!
Lose Access to Marketing Intel
If a customer orders online directly from your restaurant, you can save their order information and their email address to use for future marketing. But the third parties keep all of that contact info for their own use. And that could include pushing your customers to order from other restaurants on the platform.
Drivers Aren’t Trained to Handle Food
Most drivers for these platforms don’t have Food Handler or ServSafe® certification. This means they may not understand the risks that come with food that sits too long at room temperature and other quality control issues.
If the pros outweigh the cons for you, it’s time to decide which of these third-party delivery services you’d like to partner with. Keep in mind that you can work with as many as you like!
Partnering with Uber Eats
Uber Eats has successfully leveraged their ride-sharing business into a food delivery business. Here are some of the pros and cons of becoming an Uber Eats restaurant partner.
Pros of Uber Eats
- Uber has a reliable app that has already revolutionized ride shares
- They have a huge fleet of drivers which can make delivery times super quick
- Huge market, available in over 6,000 cities
- App is easy to use
- No credit card processing fees for restaurants
- Integrates with some POS systems
Cons of Uber Eats
- Restaurant fees:
- Uber Eats charges a $350 activation fee to sign up
- 15% marketplace fee on every order when you have your own delivery drivers
- 30% marketplace fee on every order when you use Uber Eats’ delivery drivers
- Customer fees – Uber Eats charges customers a service fee of 15% (between $2.50 and $4.50), plus a delivery fee. These fees may discourage customers from using the app.
Partnering with GrubHub
GrubHub used to be the top dog in the food delivery market, but they’ve since been overtaken by DoorDash (below). Recently, they released a new feature that may help them regain some of their market share.
Pros of GrubHub
- Large market. While not as extensive as Uber Eats, GrubHub is available in over 4,000 cities and works with 265,000 restaurants
- New direct order links. If customers order from your restaurant’s direct order link on your website or in a marketing email rather than on GrubHub’s app, you won’t have to pay the marketing commission (below). This can save you big fees!
- App is easy to use
- Most popular service in New York, so may be a good fit if you’re in that area
- No activation fee
- POS integrations include Focus, Micros, and Toast
Cons of GrubHub
- Restaurant fees:
- GrubHub charges a 20% marketing fee for orders placed through the app
- 10% delivery fee if you use their delivery drivers. Use their Profit Calculator to see what the numbers would look like for your restaurant
- Restaurants pay credit card processing fee of 3.05% + $0.30 per transaction
- Tablet/hardware rental of up to $119/month
- Wide range of customer fees
Partnering with DoorDash
DoorDash is currently winning the third-party app wars, with 55% of the market share as of February 2021.
Pros of DoorDash
- Available in over 4,000 cities
- Customer fees may be lower than other platforms, but they vary by restaurant
- Can integrate with your POS for easier logistics, including Toast and Square
- No activation fee or credit card processing fees
- No commission fee for the first 30 days
- Most popular service in Dallas/Ft. Worth, Houston, the Bay Area, Phoenix, Philadelphia
Cons of DoorDash
- Restaurant fees:
- According to DoorDash, commission prices vary from restaurant to restaurant, so they don’t advertise a flat percentage. Anecdotal evidence indicates their fees reach about 30% (20% marketing fee + 10% delivery fee)
- Tablet rental fee of $6 per month
- Customer fees – DoorDash recently implemented additional fees in many U.S. cities that put commission caps on restaurant fees, to the frustration of customers
Partnering with Caviar
Caviar has a much smaller user base than the rest of the platforms on this list, but it also serves a more niche market. Caviar is an upscale food delivery service that connects customers with the high-end restaurants in the area.
Pros of Caviar
- Since Caviar is positioned as a platform for high-end restaurants, users may be less price conscious than those on other apps
- Affiliated with Square POS, so integrates easily with that platform
- Can also integrate with Toast and other POS terminals
- Restaurant fees are not disclosed by Caviar, but research indicates they are slightly lower than the other platforms — 27% or 28% for marketing and delivery, compared to 30% for across the industry
Cons of Caviar
- Caviar has a very small market share, so there are fewer customers on the app
- Only available in 20 markets at the moment, but was purchased by DoorDash in 2019, so that may change
Partnering with Postmates
Postmates (recently acquired by Uber) says they can get you anything from anywhere — not just food from local restaurants.
Pros of Postmates
- Thanks to the recent acquisition, your Postmates listing will be pushed to the Uber Eats app as well
- Most popular delivery service in Los Angeles
- No credit card processing fee
- POS integrations include Square
Cons of Postmates
- Restaurant fees – like DoorDash, commission prices vary from restaurant to restaurant, so they don’t advertise a flat percentage. Estimates are that they charge around 15% for their marketing fee and another 15% delivery fee
- Service fee to customers of up to 20%
Don’t Forget the Local Delivery Services!
Outside of these large national companies, some cities and states have their own local food delivery services that work with restaurants.
These may have lower fees, plus they have the advantage of being part of your local community. So it’s worth looking into these options as well to see if they’re a better fit for your business.
What’s Right For Your Restaurant?
As you see, the cons of these services really come down to the costs. But for restaurants that can make these fees work as part of their overall marketing and sales strategy, they can be a good way to improve sales and visibility.
Also, keep in mind that these commission rates listed are baselines. There may be room for negotiation to get slightly improved rates for your restaurant.
Just keep a close eye on your profitability to make sure these platforms are making you money instead of costing you money!
For more tips about restaurant and foodservice operations, check out these articles next:
Uber Eats for Restaurants
These days, restaurants have a choice of many different delivery apps with whom to partner. Uber Eats is among the largest of those apps.
However, it’s not without drawbacks. Some restaurants find the commissions (30% or more) to be too steep, while others explain that the delivery app cannibalizes walk-in business. However, plenty of other restaurant owners find that Uber Eats and similar delivery apps do raise sales. Let’s take a look at how it works and what you’ll pay.
Uber Eats for Restaurants
Who hasn’t heard of Uber Technologies, Inc. (NYSE: UBER), the ubiquitous ride-sharing service that’s becomes a poster child for the gig economy? Founded in 2009, Uber has grown into a colossus, operating now in over 700 metropolises across six continents. The company has moved on from ridesharing and carpooling. Uber is now into freight delivery, electric bikes and scooters, self-driving cars and, with Uber Eats, meal delivery.
Restaurant Delivery App
Its most successful venture after ridesharing, Uber Eatsallows is a meal delivery app. Diners search for restaurants, order directly through the app, and get their meal delivered. Uber first offered meal delivery in 2014 in California and launched the Uber Eats App in 2015 ago, says CEO Dara Khosrowshahi.
The company claims the service “has grown to be the largest meal delivery platform in the world outside of China based on Gross Bookings.” In the recent S-1 filing (linked above) it declares, “Uber Eats provides restaurants with an instant mobile presence and efficient delivery capability, which we believe generates incremental demand and improves margins for restaurants by enabling them to serve more consumers without increasing their existing front-of-house expenses.” Quite a mouthful, as one would expect from a meal delivery service, but investors have swallowed. In a recent IPO, Uber raised around $8 billion.
Uber partners directly with restaurant chains, such as McDonald’s, Subway and Popeyes, as well as with local one-stop restaurants, which can sign up to work with Uber Eats on a self-service basis. The Uber Eats App also provides restaurants with the capability to market directly to consumers with personalized, sponsored advertisements such as “Recommended Dishes.” The App reduces friction in the ordering sequence by storing consumer order history and payment information. In 2018, Uber Eats acquired South African startup orderTalk, which provides online ordering software to restaurants that can be seamlessly integrated with a restaurant’s point-of-sale system. The company is hoping that linking the Uber Eats platform directly with restaurants’ point-of-sale systems will help restaurateurs analyze orders and predict demand.
Increasing Restaurant Revenue Streams
All in all, Uber Eats Appears to offer restaurants a new way to make money, reach new diners, and deliver food to their customers. In some instances, it may actually be the fastest way to get food to customers. But Uber Eats is not the only outfit delivering meals. Restaurants can choose from GrubHub, DoorDash, Deliveroo, Swiggy, Postmates, Zomato, Delivery Hero, Just Eat, Takeaway.com, and until recently Amazon, which has called it quits. The parent company announced in June 2019 that Amazon Restaurants would close its U.S. business by the end of June 2019.
How to Use Uber Eats at Your Restaurant
The Uber Eats platform does provide a menu of marvelous merits for restaurateurs. But how do you get orders? How does Uber Eats connect your establishment with diners?
Customers Come First
To use the service, a diner must first create an Uber account, which allows them to place orders online, i.e. through a web browser. Alternatively, they must download the Uber Eats App from the App Store for iOS devices, if they want to use a smart phone or other digital device.
The prospective diner begins her quest for sustenance by tapping the Uber Eats icon on her smartphone, at which point she is confronted by the app screen.
On tapping “Open”, the App will request the “delivery location.” Based on the location she has entered, our hungry diner will then be presented with a list of nearby restaurants and eateries. She can select a particular restaurant or cuisine by tapping the search icon and indicating her preferences or she may simply browse, if unsure of what to eat. Tapping a restaurant opens its menu and more detail of what it has to offer that day.
As she goes through the selection, our diner taps “Add it to your cart” for the items she wants, then taps “Check Out.’ An order confirmation screen (4) appears to allow a check. Then, after tapping “Check Out”, payment options appear. Finally, she taps “Place Order”, and the order enters cyberspace to your restaurant.
Handling Orders on Uber Eats
There are three basic aspects to an Uber Eats order: 1) accepting an order; 2) managing an order; and 3) tracking an order. On the App, restaurant owners and managers will use the restaurant dashboard to accept and track orders they receive. To access the dashboard, simply tap the Uber Eats icon on your device.
The order from our diner and additional new orders appear on the left sidebar. New orders announce their arrival with a sound and a green light flashing the words “New Order.”
Tap on the lighted area to accept and you’ll see the details, including special instructions from the customer, such as extra napkins. These details appear on the right in the main screen area, e.g. one Best Cheese Burger $11.70.
Each order will display an estimated pickup time. This is when you can expect a delivery partner to arrive. If the order is set for delivery hours or days ahead it will be signaled with an amber light flashing the words “Scheduled Order” rather than a green one that highlights the words “New Order.” However, accepting the order is done the same way, i.e. by tapping on the lighted area. The order will then move down to the “Scheduled Order” section of your dashboard. When it’s time for the food to be packed and delivered, the order will reappear at the top of your queue.
You can start to prepare the order when the delivery time approaches. You’ll see a “Ready by” time, which will give some idea of how long you have to prepare the order before a delivery partner arrives to take it to the customer. As the delivery time approaches, Uber Eats will match you with the nearest delivery partner. If you finish preparing an order ahead of schedule, you can tap “Food is Done” and the delivery partner will come earlier.
Delaying, Cancelling, and Pausing
If you need to cancel or delay an order, tap the “Arrow” button, and you’ll see “Delay Order” or “Cancel Order.” If you need just a few more minutes, press “Delay Order” and state how much more time you need. If you are no longer able to fulfil the order, press “Cancel Order.” Uber Eats will notify the customer, accordingly.
Need a break from accepting orders? Press the “Accepting Orders” button in the bottom left and select “Pause New Orders.” This will mark your restaurant as unavailable in the Uber Eats App until you’re ready to accept orders again.
Once you’ve been matched with the closest delivery partner, you can always tap the “Arrow” button to track or contact him or her and view their name and photo. When your delivery partner arrives, they will show you the order number, usually on their phone.
Tracking the Order
As soon as the delivery partner leaves, the order will move to the outward delivery section in the left panel. You can track it on the map all the way to the customer. When the delivery is complete, tap the three lines in the upper left hand corner. There, you can see your delivery history complete with price breakdown and other information. You can also rate your delivery partner and contact support.
A Buffet of Other Features
Other features available on the left panel include marking a menu item as “sold out.” To do so, tap on the “Hamburger” button and navigate to the menu tab. Tap on the “Sold Out” item, find the icon that looks like an eye and select “Unavailable Today” or “Unavailable Indefinitely.” The icon will turn from grey to yellow, indicating that the item is sold out. The left hand panel also shows your account info and the Uber Eats support number.
The Uber Eats Restaurant Manager
The Uber Eats Restaurant Manager (RM) provides decision making data for your business. The Uber Eats Restaurant Manager has four sections: 1) Restaurant Analytics; 2) The Payment Section; 3) Menu Editor; and 4) Preparation Time Editor.
The first page you see after logging in is the “Sales” Page in the Restaurant Analytics section. Here, you can view your sales for the week, as well as your top selling menu items. To see your overall sales for the past month, click on 30 days in the upper right corner to change your view. On the bottom left, the drop down arrow menu provides options for the bestselling items: 1) past month; 2) past week; or 3) yesterday. Data on your service quality is also provided and includes metrics such as accepted orders and menu availability, with more details that will help you improve speed and convenience on the right. Scroll down to see customer satisfaction and ratings. This is useful information to help you improve customer service.
Click on the credit card icon on the left side of the screen to see payments. Payments are directly deposited to your account on a weekly schedule. You’ll be able to view a weekly summary of all your earnings or earnings broken down by day. You can also click on the “Download” icon to download a CSV of your order history for that week. This is a great tool to utilize for accounting purposes.
The Menu Editor tool allows you to update your service hours, add, remove or edit menu categories or items, and create modifiers for your items. Changes can take up to 48 hours to take effect.
Preparation Time Editor
The Preparation Time Editor is accessed by selecting the time watch icon in the left panel. In this section, you can update your average prep time, which provides your clientele with useful information. You can adjust the average prep time by time of day. Busy lunch periods will require longer prep times than mid-afternoon, for example.
How Much does Uber Eats Cost Restaurants?
In answer to that question, this Uber Eats FAQS simply says: “We collect a service fee, which is calculated as a percentage of your sales on Uber Eats.”
A Forbes article Why Uber Eats Will Eat You into Bankruptcy is more forthcoming:
“Uber Eats charges a restaurant 30% of their listed prices for the privilege of delivering their food. For example, Bob’s Deli charges $10 for a burger. Uber Eats would take $3 dollars as a fee for delivering their food. Also, Uber Eats does not permit restaurants to increase their prices to “cover” Uber’s cost. Thus, Uber is telling restaurants that they must eat the cost and lose money or we won’t deliver for you.”
In the low margin (15% or less) restaurant business, paying 30% for delivery may break the bank.
Uber Eats App: Caveat Emptor
The Uber Eats platform appears at first sight to be a boon to restaurants. But there’s more to this scenario than meets the eye, when costs and customer behavior are taken into account. Uber Eats promotes its platform by arguing that orders made through it are “on top” of a restaurant’s regular business. However, according to investment bank Morgan Stanley that may be misleading. Rather than adding on, orders through platforms like Uber Eats are more likely to cannibalize regular walk-in business. Since the margin on delivered food is less, any shift to more online sales means less profit for restaurants. This will be a growing problem for restaurants that are partnering with Uber Eats to remain competitive. Morgan Stanley estimates that “40% of total restaurant sales—or $220 billion could be up for grabs by 2020, compared with current (2017) sales of around $30 billion…”
But Can 220,000 Restaurants Be Wrong?
Despite such caveats, Uber Eats has garnered widespread acceptance from eating establishments. Indeed, Uber’s 2018 prospectus claims that “15 million received a meal using Uber Eats in the quarter ended December 31, 2018, tapping into our network of more than 220,000 restaurants in over 500 cities globally.”
A series of promotional videos entitled “Restaurant Profiles” features restaurant owners all waxing enthusiastically about the virtues of the Uber Eats platform. One believes Uber Eats is the ideal vehicle “to extend our dining room into people’s living rooms.” He says that after signup, his establishment enjoyed increased volume, with the order tablet “ringing and buzzing.” He also likes Uber Eats because of its capability as a marketing platform. When listing their menus, restaurants have the opportunity to do so in a way that catches customers’ eyes. The “one picture” of a meal on someone’s phone is worth more than a thousand words on a menu card. The Uber Eats App started as a logistical tool but already is morphing into a marketing one.
Another attractive feature is geo-tracking, which allows the restaurant, as well as the diner, to see, at any given moment, where the driver and food is.
In enterprise terms, Uber Eats has grown to the point where the unit is contributing roughly 18 percent of the company’s business. Industry-wise, Uber Eats commands a market share of 25.2 percent, according to data from Edison Trends reported by Fortune. This places Uber Eats in third place, after GrubHub, with 26.7 percent, and market leader, DoorDash, which has now taken the top spot with 27.6 percent.
Meals on Wings
Uber Eats may soon be airborne. In summer, the company plans to start delivering food by drones in San Diego. What happens in San Diego is unlikely to stay in San Diego. If those trials are successful, Uber Eats drones may soon be flying to a restaurant near you. Could it be yours?
Restaurants uber eats
Should Your Restaurant Be Using Uber Eats?
In a world of apps that do everything, restaurants have to choose carefully when deciding which third-party services to offer customers. One buzzworthy restaurant service, Uber Eats, has gotten plenty of media attention over the past year for its popularity among customers — and also for its less-than-ideal treatment of the restaurants it partners with.
Several years ago, the widely known rideshare app banked on name recognition to jump into the growing third-party food delivery industry. Competing with names like Postmates, Doordash and Grubhub, Uber Eats makes money by using its drivers to deliver food from restaurants that don’t traditionally offer a delivery option.
For restaurants looking to expand services and reach new markets, signing on with Uber Eats or one of its competitors could be a smart option. However, the app comes with some drawbacks.
Keep reading to get a feel for what you’d be getting into by signing on with Uber Eats.
Uber Eats, like all of its competitors, offers restaurants the chance to find new customers, increase brand awareness and offer convenient delivery, all without having to do more marketing or hire a delivery staff. On its website, Uber Eats touts that has “seen restaurants increase sales, lower marketing costs, and hire new employees to capitalize on Uber Eats demand.”
It’s no secret that Uber is a big name in the digital game. When Uber does anything, people pay attention, which is part of the reason why Uber Eats consistently has more monthly active users than every other food delivery service. And that trend is on track to solidly continue. If you want to get your name on a delivery site that people immediately recognize, Uber Eats is the way to go.
Because of its size and access to drivers, Uber Eats also has some of the lower delivery times compared to its competitors, which is something to think about if you are worried about food quality. Faster service means warmer food and happier customers — especially in a world when people realistically don’t want to wait for more than 15 minutes for their food to arrive after it leaves your store.
On a basic level, using any third-party food delivery service forces you to give up some control over your brand. Whatever experience a customer has with Uber Eats, it also has with your restaurant. If food shows up damaged or cold because of a driver oversight, the customer may see a reason to blame you. If you want Uber Eats or any service to deliver food on your behalf, you have to be willing to roll with the punches.
Another major downside is what Uber charges you just to participate. If you want to sign on board, you have to be willing to cough up 30% of the food’s listed price before Uber will take it anywhere. We know that profit margins for restaurants can vary widely. Many fast food restaurants, such as McDonald’s, have profit margins of only about 22% (on average). Fine dining restaurants often come in even lower, around 6.1%. If you aren’t careful, you could actually end up taking a big hit by signing onto Uber Eats.
It’s worth noting that Uber does not allow restaurants to raise prices to make up for some of what Uber wants, so if you’re signing on you should be prepared to eat all of those costs. Other competitors, like Doordash and Postmates, have slightly lower costs, ranging from 12-24% of the total order.
Each customer who uses Uber Eats also pays a delivery fee and is expected to tip his or her driver, so the total amount going to the app and its drivers is high, compared to what you are likely making off the order.
How to Decide
If you’re thinking about signing up for Uber Eats, check your profit margins and make sure you’re good to go if you end up taking a hit on a couple of orders. Brand awareness and increased sales may very well be enough to make up for it. No matter what, if your main goal is marketing, Uber Eats is sure to get your name out there.
Graves Foods is one of the leading food distributors in the midwest, serving Missouri, Oklahoma, Kansas, Arkansas, Iowa, and Illinois. Contact us to start planning new menus or to order food for your restaurant’s kitchen today.
How to Register with Uber Eats – Everything You Should Consider
So you want to deliver using Uber Eats?
After your restaurant is registered with Uber Eats, you can get your food delivered to your customers in no time.
In this blog, we’re going to cover the following things in detail:-
- Steps to register your restaurant with Uber Eats
- Licenses involved in the registration
- Reasons behind the Uber Eats’ growth
- Advantages of registering with Uber Eats
- Drawbacks of registering with Uber Eats
- Alternatives to Uber Eats
So let’s get you on board!
How to register with Uber Eats?
Uber Eats registration for restaurants is not at all complicated.
Uber Eats has an interest form for all those looking to register with Uber Eats as either restaurant or delivery partners.
Before you begin with the entire process of registration with Uber Eats, make sure you have all the legal documents and licenses of your restaurant ready with you. You’ll be required to upload these during the later stages of the registration process.
1. Open Uber Eats on your browser and scroll to the end of the page. You’ll find a “Become a restaurant partner” link, click on it and it will direct you to a new page.
If your restaurant is based out of the US, then open this page.
Having trouble finding the link? Click here.
2. Once you’ve been redirected, the restaurant sign-up page will prompt you to fill in the basic details like:-
- Restaurant Name
- Restaurant Address
- Your Name
- Your role in the restaurant (Owner, General Manager, Chef, etc.)
- Contact details – Phone number and email address
- Restaurant Details – Number of locations, Type of Cuisine, Weekly orders and whether or not your restaurant staff delivers orders
3. After filling the details mentioned and shown above, click on “Submit” to get the process started.
4. Once you’ve filled in all the details, Uber Eats will get back to you after having reviewed your restaurant’s particulars.
If your restaurant fits their guidelines and is approved, they will contact you for continuing with your Uber Eats registration process. The following process includes submitting some more details specific to your restaurant.
Once completed, Uber Eats’ executives will assist you in reviewing your restaurant’s menu and prices. They also send representatives who will help you get familiar with the Uber Eats app.
What are the licenses required for Uber Eats registration in India?
Uber Eats does not partner with just any restaurant. Their registration process is elaborate. It involves thorough checking of all the information and documents provided by you.
In order to make the process smooth, make sure you have all the documents and licenses ready with you for a quick verification process during your registration with Uber Eats.
1. FSSAI License – The Food Safety and Standard Authority of India, provides a license that is mandatory for all restaurants. Having this license means your restaurant is compliant with the food safety standards of India. Each restaurant is given a unique FSSAI number.
2. Shop License – If you own a restaurant, this is another significant license that you must have. This further authenticates the presence of your restaurant.
Read here to know more about the 10 licenses you need for your restaurant.
3. Owner’s identification proof – As a restaurant owner, you must have all the necessary documents like your personal identification number. For India, you’d need a PAN card and an Aadhar card.
4. GST number – Each restaurant has a unique Goods and Service Tax number. The GST levied is different for different restaurants. Make sure you know what is the GST rate applicable for your restaurant and you’re good to go.
Why is Uber Eats in great demand?
Uber Eats contributed 13% of Uber’s revenue in two years. It’s gross booking reached $7.9 billion in 2018. Given that Uber is already well established in the market, investors are willing to invest their money in this new venture. Uber sees this as a great opportunity for growth and expansion.
The reason why Uber started this new venture in the food industry is because of the customers. Let’s look at some of the key reasons behind the success of Uber Eats.
1. The great smartphone shift
Recent years have witnessed a massive shift towards smartphones. Simply because of the level of convenience that it brings to customers. In addition to this, high-speed internet on their phones compels them to play with technology. This way a large number of people have access to online food delivery apps. People no longer want to go through the trouble of going out and eating. They’d rather order in after a long day at work. When you register with Uber Eats, you can make this possible for your restaurant’s customers.
2. They know exactly what and when to market
Marketing plays a crucial role in running a restaurant business. After registering with Uber Eats, you wouldn’t have to worry about marketing. Uber Eats use their own marketing and branding strategies. They market to the right audience, at the right time with the right content. And hitting the right channel is bound to get you customers for your restaurants.
3. Plethora of options
Today, customers (especially the millennials) want as many options as possible. They not only want to try out new restaurants in their city but also want different options for types of cuisines. Tons of options satisfy their purpose of trying new things and Uber Eats provides them with that. Online ordering aggregators go heavy on online promotions and are very visible to consumers who wish to order online. Traffic on these platforms are in the tune of millions and is growing rapidly. Added to that, restaurants have multiplied and tons of options are now open to people to try from. Uber Eats is that platform which connects the restaurants to consumers and is benefitting greatly from the growth of both!
4. Smooth payment methods
Uber Eats is extremely flexible when it comes to ordering payments. Customers have the option of paying by cash, cards and other payment gateways available in their respective countries. More and more people are shifting towards cashless modes of payments. Uber Eats provides multiple payment gateways that customers can opt for.
5. Great customer experience
Uber Eats offers a great customer experience. Features like easy tracking, quick delivery, customer reviews, and more help in building faith in their customers. Their feedback will let you know exactly where to change your methods. Multiple restaurants to choose from, easy online payment modes, quick food deliveries and more add up for providing exceptional guest experience.
6. Ease of ordering in
One of the most obvious reasons why Uber Eats is soaring is simply because of the convenience of getting food delivered whenever one feels like. Given how everyone is constantly on the move, people prefer ordering in rather than eating out. Receiving heavy discounts regularly also compels customers to order from Uber Eats. Who doesn’t like ordering a pizza while binge-watching their favorite TV show on Netflix?
Midnight hunger finally has a cure. According to LimeTray’s Online Food Delivery Report, it was noted that late-night delivery is growing 25% faster than the overall online food delivery trend.
Why should you register your restaurant with Uber Eats?
1. It’s a growing business
According to, Jason Droege, Global Head of Uber Eats, told The Economic Times that India is the fastest-growing market for Uber Eats in the world. The article also read that, by and large, it contributed 13% of Uber’s overall gross bookings from 10% in 2018. And as per Global Media reports, Uber Eats alone has a net worth of $20 billion.
Read the full article click here.
Hence, partnering with Uber Eats will help grow your restaurant business as well.
2. And a trusted brand
Uber is a well-established brand worldwide. Billions of people are associated with this brand via Uber’s ridesharing. Therefore, selling Uber Eats to already existing customers is relatively easier as the initial process of gaining a customer’s trust has already been done. And once that is done, it is easier to sell to these customers.
3. It’s going to help you increase customers
It is not easy to build a name in the restaurant industry. There are tons of restaurants out there and a good chunk of them have been there for a long time, made their name and developed a loyal customer base. For a new restaurant to come in, make a name and survive is not easy. Close to 6 restaurants out of 10 fade out within the first year of operations. Lack of audience and brand name, failure to market well are few of the contributing factors to this. This is where Uber Eats comes in. The Uber Eats delivery app is going to help your restaurants reach a wider audience. You can make your brand reach out to more people through the marketing and promotional strategies adopted by Uber Eats. This way your restaurant will be able to target a new audience. Their marketing strategies target all major fields like website, social media, mobile apps, Google and YouTube ads, TV commercials and more. All this will come at a cost of a commission rate on each of your completed orders (via Uber Eats). Not a bad rate at which you can enter the overcrowded restaurant market.
4. No more food delivery woes
Managing delivery orders can sometimes be tiring for restaurants, a nightmare even during mad rush hours. By partnering with Uber Eats, you wouldn’t have to worry about delivering food to your customers. As mentioned earlier, just let them know if you have staff that delivers food or not, and they’ll handle the rest. They promise quick delivery. Customers can easily track their food once it’s out of your restaurant doors.
Don’t worry, your food is in safe Ubers.
5. Review and perform better
The majority of customers read reviews of a restaurant before placing an order from there. So yes, reviews do matter, especially positive ones. Do people like your restaurant’s service? Are they talking about their favorite dish at your restaurant? Uber Eats helps you see what people are saying about your brand. They have tools like customer feedback, dish ratings, and other data, that is going to help you in improving and improvising your restaurant’s performance. The app also helps customers with restaurant recommendations based on their favorite dish.
6. Easy menu updates
Summer calls for some seasonal fruit smoothies or Christmas is always better with some customized cookies and cupcakes. You can easily update your menu and it’s pricing directly on the Uber Eats app. Your customers will come to know about any new categories or additions to your restaurant’s menu.
What are the shortcomings of registering with Uber Eats?
Scientifically speaking, for each positive, there exists a negative. While there are numerous benefits of partnering with Uber Eats, there are a few loopholes that can’t be ignored entirely.
1. Paying a service and activation fee
You will have to pay a commission on every order that a customer places with your restaurant. The service fee is added on the subtotal of each order. Given exceeding growth rate, online food aggregators tend to increase their commission rates after a while. Paying heavy commission rates proves to be a little daunting when it comes to managing your restaurant’s revenue.
2. More competition
This battlefield has a lot of skilled players. There are many restaurants registered with Uber Eats thereby increasing your competition. And with so many options, customers tend to make their judgment based on price reviews, and ratings. It might get tricky to get your brand recognized in such a wide space.You’ll have to crack the code and work hard towards creating a unique identity. Many restaurants lose out on customers when the latter does not happen.
3. Restricted space on the Uber Eats platform
Uber Eats has a definite set of guidelines on its platform that your restaurant is bound to follow. Let’s say you come up with an out of the box plan for your restaurant’s promotion. Let’s say you want to promote a BOGO offer. Or maybe a trendy Netflix series to go along with your meal.
On the contrary, on Ubereats, you’ll have 6 restaurants on the same screen.
This is what the Ubereats desktop platform looks. It’s worse on mobile. Tough to be really creative in that little space right?
Once you are onboard with Ubereats, the rules laid down by them must be strictly adhered to. This can hinder your restaurant’s growth as you won’t be able to be creative or shout out your offers as you would be on your own platforms.
4. Tricky investment
There are many other well funded third-party food aggregators in the market today. The odds of getting good returns, in the long run, might not be in your favor. High commission rates and low profit on every order could also prove unhealthy for your restaurant.
Having said that, the popularity of an online food delivery platform like Uber Eats is unbeatable. The customers are more likely to order from your restaurant through Uber Eats than doing so otherwise. No one, in today’s time and age, wants to go to a restaurant and eat when they can do so in the comfort vicinity of their homes.
Overcoming the shortcomings
We have painted a fair enough picture in front of you listing down all the pros and cons of associating your brand with Uber Eats.
Still unable to reach a conclusion?
Let’s look at how can you overcome the shortcomings mentioned in the section above.
- Instead of having to register with Uber Eats, you could build your restaurant’s presence online yourself. Having an online food ordering system can immensely help your brand grow.Orders will be received on a single platform, then automatically get punched into your restaurant’s Point of Sale system and easily managed thereafter.
- Having your restaurant’s own online website will help you build it from scratch, the way you want it to. You can add tabs and sections that are unique to your restaurant. Modification and regulation of different sections will also become fluid. All updates can then happen in real-time.
- Now that you have your own space online, you can advertise and market your brand the way you wanted to. No limited space for new ideas. You can be as exclusive and creative with this now that you’re not burdened with a limited set of guidelines.
- You will no longer compete with other restaurants on the same platform. You can promote your restaurant through your own website. You will also cut down on the commission costs to these third-party food aggregators. The commission costs to these third-party food aggregators also get scrapped off.
Your ride is complete!
We looked at the basics of how you can register with Uber Eats, what are the things you should keep in mind while getting your restaurant registered and all other things associated with it. For example, Uber Eats will help you market your brand but having an interactive online website will give you room to present your brand’s concept in better ways. Or, whilst registering with Uber Eats may help you get traffic to your restaurant, having your own online ordering website will prove more beneficial.
Tying up with Uber Eats has its own benefits and drawbacks. You can decide what’s best for your restaurant only after having analyzed both. Eventually, it’s your call.
Ready to book an Uber?
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Uber Eats: Food Delivery
Get food delivery to your doorstep from thousands of amazing local and national restaurants. Find the meal you crave and order food from restaurants easily with the Uber Eats app. Track your order in real-time.
FIND YOUR FAVORITE FOOD & RESTAURANTS
Order food from nearby restaurants and search by cuisine, restaurant name, dish, meal. The Uber Eats app offers a variety of food delivery options for you to order and enjoy, including: pizza, burritos, burgers, sushi, and tasty Chinese takeout. Prefer Pickup? Skip the line and reservations and choose to Pickup your order instead. Choose your favorite delivery options with the Uber Eats app now.
SUBSCRIBE TO THE EATS PASS
For $9.99 per month, Eats Pass subscribers get $0 delivery fee and 5% off orders over $15 at eligible restaurants available on Uber Eats. United States and Canada only (excludes Quebec). See availability, fees, terms & conditions in the Eats Pass section of the Uber Eats app.
SIMPLE DELIVERY ORDERING
Pick your food order from any menu and add it to your cart with a few taps. That’s it.
Uber Eats makes it easy to order food delivery online or through the app and have it delivered by restaurants and delivery people near you.
Or, schedule your order in advance for a delivery person to pick it up later. Your choice!
ORDER FOOD AHEAD WITH PICKUP
Now you can also order food ahead for Pickup instead of just ordering delivery. Select Pickup, add food items to your cart, and skip the lines to the restaurant to get your food.
REAL-TIME ORDER TRACKING
Track your food delivery order on a map as it heads your way.
See the estimated arrival time at your address.
Get notified when your order arrives.
NO-CONTACT DELIVERY OPTIONS
Choose to have your food delivery order left at the door for a no-contact experience. If you have additional instructions or preferences, you can let your delivery person know where you’d like your order to be placed—like a lobby, doorstep, or another dedicated place.
FIND SOME OF YOUR FAVORITE NATIONAL RESTAURANTS
Some of our food delivery partners include: Buffalo Wild Wings, Burger King, CAVA, A&W, Chick-fil-A, Chipotle, Dunkin', IHOP, KFC, McDonald's, Panda Express, Panera, Popeyes, Shake Shack, Sonic, Starbucks, Subway, Sweetgreen, Taco Bell, Tim Hortons, Wendy's, Five Guys, Jersey Mikes, White Castle, Jack in the Box, Outback Steakhouse, Red Lobster.
THE APP CHOICE OF MILLIONS
Over 1 billion orders have been delivered by delivery people using the Uber Eats app. Join the millions who choose the Uber Eats app to order food today.