Shh, I'm Going to Tell You a Secret?

This picture reminded me of the an age old saying, "Never be too busy for success."

One of the most common suggestions we receive from our customers and clients at UGottaEat.com is, "Derek we love UGottaEat.com's service and you have a great variety BUT, when are you going to get 'so and so' restaurant?"  Well we think it's about time we deliver the goods so we can do just that, give you more!  

First, we thought it would be better if we give you some info on how an RDS (Restaurant Delivery Service) like UGottaEat.com works.  RDS's have been operating nationwide for the past 20 - 30 years.  Our national trade organization (which UGottaEat.com is a member) is the Restaurant Marketing and Delivery Assoc. (RMDA).

General RDS Business Model:
A traditional RDS contracts with local restaurants to deliver prepared meals to customers. The RDS typically prepares and distributes a menu guide containing the contracted restaurants, and will then take the customer’s meal order over the phone or internet. 


The RDS will then fax the order to the restaurant, and have a driver pick up the prepared meal and deliver it to the customer. The driver will then collect payment for the meal from the customer, and return it to the RDS at the end of his/her shift. The RDS then pays the restaurant for the ordered meals at the end of the agreed upon payment schedule, (typically every 2 weeks).


How Does the RDS make Money?:

There are typically three primary methods an RDS makes money, all used in conjunction with each other.

1. Obtaining the food product from the Restaurant at a discounted price (also called a commission).
2. Charging a delivery fee to the customer.
3. Charging the Restaurant a monthly marketing fee.

Each market is different with their pricing structures, but here is a quick example. The RDS owner may decide to contract with a local restaurant in order to deliver prepared meals to local customers. The $10 hamburger sold by the restaurant to the general public is sold to the RDS at a discounted price of $7.00 in effect getting the RDS $3.00 revenue from the sale of the restaurants food.  This normally represents a 40% profit increase to restaurant partners for every dollar sold through a RDS.

The RDS will then charge a delivery fee for the service of delivering the food to the customer, to pay for drivers.

The RDS will also charge the Restaurant a monthly marketing fee in exchange for placing their menus in your published menu guides.  UGottaEat.com waives the monthly marketing fee if the restaurant does less than $250 in sales a week through our service.

Financial models vary slightly from RDS to RDS, and from market to market, generally the commission made from the food sales and the charge for marketing fees go to the RDS, while the revenue generated by the delivery fees and tips go to pay drivers.


Well What Benefit Does the Restaurant Get?
We're glad you asked!  We did mention that RDS's have been operating nationwide for the past 20 - 30 years and UGottaEat.com has been serving Valley restaurants for nearly three years so there must be some benefit... right? Right!

1. Additional Sales:  The more distribution points you have for your product the more sales!
2. No Long Term Contract:  Restaurants can opt out of agreement at any time.
3. Increased Marketing: Online at UGottaEat.com and through menu guides
4. Access to More Customers: Customers at work? No problem!  Customers on the other side of town? No problem?  Customers lazy? No problem.  We bring your restaurant to the customer!
5. New Markets: Gain instant excess to new markets with no increased effort.  Even if you offer delivery what is the scope of delivery compared to your local RDS?
6. No Expenses: With traditional delivery there is increased payroll, payroll taxes, workers compensation, insurance, hiring, firing, driver management, etc.  RDS allow restaurants a pay as you go system that usually is A LOT more efficient and cost effective.

I could go on but, if your an interested restaurant or caterer, give us a call: 330 743 8135.  If you're a customer of UGottaEat.com you should now better understand how we work.  Don't forget to continue and request that your favorite restaurants partner with UGottaEat.com.  We hope to deliver for you soon.  Thanks for reading!

[Thank you to DataWedge which I borrowed some material from]
U Gotta Eat.com is a restaurant marketing and delivery service serving the Youngstown - Warren, OH metro area since 2008.  We provide specialized marketing for restaurants along with delivery service from partnered restaurants and caterers. Drop off catering and individual meals orders are offered for delivery to business clients and residences. For more info contact: 330 743 8135 or online: www.UGottaEat.com


All the Best,

Derek Caffe
CEO/ Founder
U Gotta Eat
35 S. Champion St., Suite 310B
Youngstown, OH 44503
www.UGottaEat.com
info@ugottaeat.com
P:330 743 8135
F:330 480 9607

It's the "Hard Knock Life" for single location restaurants!

This post is in response to an article posted on the Entrepreneur.com "Daily Dose" blog.  In the article the author addressed some scary figures for mom and pop restaurateurs.  Since 2006 the average restaurant owner has seen their revenue drop between 7 - 8% and the sector is expected to have shed more than 5,000 restaurants. With numbers like those a single locale restaurant owner may feel there's no hope right?  Wrong!

Instead of waiting for the economy to "get better", it's time to realize that what you're experiencing is the new normal and if you want your restaurant to make it to the new year, it's time to adapt.   Here are 5 ways your restaurant can make the second half of 2010 yours:

1. Drop The Ego!:
I hear the same thing over and over from restaurant owners.  They brag about how they make the best this and that in town, how they use only the finest ingredients, while also touting that they're the cheapest. They see this as their marketing strategy!  Fact is having the "best food" by itself is not a viable marketing strategy. McDonald's does not make the best hamburger but, you don't see them struggling to get a customer in the door do you?  Look for new means and venues to get your message out there and don't be afraid of change.  Sure some ego is required to be a business owner but, don't let your ego get in the way of your success!

2. Don't Try and Please Everyone!:
Stop trying to be everything to everyone and zero in on your two to three top products and/or services and be the best in that category.  Many times in order to bring revenue through the door restaurant owners make the mistake of trying to be everything, which in turn makes you a nothing.  Since you don't have a specialty then nothing ever sticks with your customers.  Find out what you're best at, enjoy doing and stick to it. Once you establish a name for yourself in your specialty then broaden your horizons.

3. Create A Catering Menu:

If you don't have a catering menu for your restaurant you are missing out on a very lucrative piece of business.  Catering menu's allow your patrons to order your food in bulk for their corporate and social events.  If you're thinking, "My customers already know that we can offer catering for them.", even though you don't have a catering menu or advertise it.... well then, here's the link to craigslist where you can post your restaurant for sell in advance.

4. Create Multiple Mouthpieces!:

More than likely you weren't ridiculously loaded when you started your restaurant.  So assuming the previous statement is true we're also going to assume you don't have the funds to flood the TV, radio, newspaper, etc. with ads for your restaurant.  Now then how do we get the word out about your restaurant?  This right here requires a bit of thinking and leg work on your part.  

You need to find strategic alliances with other businesses who can either use your product/services or they have a product/service that adds value to what you already offer customers.  Also consider referral programs or ways to incentivize customers to recommend you to their friends, family and colleagues.  And the thing is you need to constantly be creating mouthpieces.  You're competing with lots of other businesses for the attention of your customer, talk louder!

5. Connect With Your Customer!:

Sorry, just having a decent lasagna at a decent price isn't enough to keep your customers coming in the door. You need to take the time and really connect with your customers.  Send them a thank you card with a discount off of their next visit.  Customer mentions that they'll be celebrating a birthday in a week or two?  Prepare a quick birthday card and let them know you're listening.  Nowadays it takes more than just doing your job to retain customers, figure out a way to set yourself apart from the competition and really let customers know that their business is appreciated.

Hope this helps your restaurant or general business make a bigger splash in the second half of 2010.  If you own a restaurant or catering company in the Youngstown - Warren, OH metro area don't forget to give UGottaEat.com a call at 330 743 8135 to see how we can put our resources to work for your establishment and bring in additional sales.  You can read the original article here.

All the Best,

Derek Caffe
CEO/ Founder
U Gotta Eat
35 S. Champion St., Suite 310B
Youngstown, OH 44503
www.UGottaEat.com
info@ugottaeat.com
P:330 743 8135
F:330 480 9607