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With services like Grab and FoodPanda becoming increasingly common, food delivery services are almost ubiquitous nowadays. There are many advantages or disadvantages for a business to engage in food delivery services. Let’s discuss the pros and cons of food delivery services, as listed below.
Pros
Increased sales
For businesses, food delivery services are great in helping to increase customers. During COVID-19, when many customers are unable to travel, food delivery services can make your business accessible to more customers. With the widespread use of food delivery applications, customers are introduced to more businesses online, allowing them access to a wide variety of cuisines and meals. Many businesses have become better-known by engaging a food delivery service, allowing them to deliver to customers all around the neighbourhood. By raising brand awareness, this increases the sales and availability of your business.
More business opportunities
Food delivery services can also open up more business opportunities and the potential for collaboration. Many restaurants and hotels aim to serve vast numbers of customers through engaging food service applications, leading to more opportunities for cross-industry collaboration, in hospitality, food service, and tourism. Furthermore, businesses will be able to offer more exclusive promotions through food delivery services, resulting in business opportunities and growth.
Healthier delivery options
For the consumer, food delivery services can bring healthier food options closer to you. Food delivery kits can offer ideal proportions of veggies, proteins and carbs, taking the stress out of household cooking. Online food delivery can also offer healthier choices further away from you of various kinds, including vegetarian, vegan, and gluten-free options. These services enable customers to commit to healthy eating plans.
Cons
Less control
When your food delivery service is handled by a 3rd party, it lessens your control over consumers’ experiences. You will not be able to control the traffic, when the food arrives, and other such situations. Inadequate delivery services can impact your branding, rating, and lower customer goodwill.
Smaller profit margins
Although you may attract a higher number of customers via food delivery services, you may still end up with smaller profit margins for your business. If you are engaging your delivery persons directly, there will be considerable costs, such as salaries, vehicle fuel and driver insurance. On the other hand, working with an external delivery service presents its own challenges. Food delivery apps often charge a premium per delivery, taking a cut of each meal delivered. This can lower the profit margins you would receive from customers ordering directly, and require a higher number of orders to make ends meet.
