Why restaurants are moving out from third-party aggregators

May 10, 2021

Why Restaurants are moving out from third--party aggregators | Shopurfood
Restaurant moving out food aggregators

Restaurant and takeaway businesses are struggling to survive due to pandemic situations. As dine-in facilities are restricted still in many countries, people are moving forward to online ordering more than before. Many restaurant owners are moving drastically away from third-party food delivery services because of their inefficiency that we will discuss in this blog.

Why do restaurant owners avoid 3rd-party services? 

The major reason that most restaurant businesses encourage online ordering is to benefit from a big money at play. According to reports, online food delivery revenue is projected to reach Euro 134 billion with 11% yearly growth in 2021 across worldwide. Restaurants were initially happy with aggregator platforms for food ordering but now circumstances have changed their minds due to some downsides of it. Before moving into the drawbacks of third-party aggregators, first, let's see how they actually work!

How third-party food aggregators work?

Restaurants and takeaways can submit their menus to third-party aggregator apps and websites. Once the customer places their orders then contract drivers will initiate the deliveries using their own transport. As a result of it, the aggregator services will earn both restaurant commissions and delivery fees. Some well-known third-party aggregators include Just Eat, Uber Eats, and Deliveroo.

However, customer's food ordering habits are continuously evolving with new trends. Restaurants are now increasingly offering their own websites or apps for food ordering. This is one biggest reason why a large number of restaurants want to launch their own ordering software. Therefore, restaurants must get their own food delivery application to thrive more. Now let's dive deep into the major cons of third-party aggregator platforms in detail.

The cost is too high

The third-party delivery services are charging high commissions from restaurants. The businesses are facing turmoil in dealing with delivery aggregators just because they squeeze out their profits. As restaurants have to pay up to 30% commissions for the order placed from third-party sites, it's really hard to meet their margins. As per the research in 2020,  89% of the consumers said they would directly order from the restaurant site in order to reduce such high commissions.

Lose of control

By having control over your food ordering platform, restaurants can reduce dissatisfied customers. Sometimes, orders placed from third-party platforms don't reach customers due to out-of-range and other reasons. By outsourcing your own ordering platform, restaurants get full control of their brand and business operations right from orders placed to delivery. Therefore, third-party aggregators are damaging your brand reliability, accuracy, delivery duration, food presentation, and many other factors. Ensure to have powerful control to build your reputation and brand.

Long-term Customer relationship

The major concern for opting out from third-party aggregators is losing direct customer relationships; you tend to risk long-term customer loyalty here. According to research, you can increase sales by up to 75% if you increase the number of loyal customers even by just 5%. As businesses can't have access to all the customer data using the aggregators. Whereas own ordering platforms along with marketing efforts can build your loyal customer base using crucial customer data. Hence, loyal customers are more essential to retain your ROI.

Customer's interest

As mentioned earlier, customers' preference regarding food ordering keeps changing with trends. Most customers prefer ordering food directly from a restaurant's website or app due to secure payment and reliable delivery timings. Also, many customers want to support their favorite local businesses during such hard times by ordering directly from restaurants. According to a survey, 90% of people prefer ordering food directly from restaurants online more than once a week.

How one time investment can help you grow?

Using your own online restaurant ordering system can surely reduce commission rates which deliver sustainable growth for your business. This one-time investment in creating your own food ordering app or website can drive more potential customers and increase your sales. It allows restaurants to enjoy complete control over their customer's experience and gain fruitful loyal customers. Hence, build your own ordering marketplace and avoid additional monthly expenses to gain long-lasting, and profitable relationships with your customers.

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Kiruthika Blogger

Kiruthika

Kiruthika is a Content writer and blogger at Pofi Technologies. Other than her interest in writing, she can be seen listening to songs, reading or traveling.
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