Delivery isn’t new to the restaurant business, but that doesn’t mean there aren’t still growing pains. In the past five years, delivery as a percentage of revenue for quick service restaurants has surged, from 2.4 percent in 2020 to 11.1 percent in 2023 (our last full year of data), and tracking to be even more in 2024.
What that doesn’t show is lost sales in this critical channel. At Delaget, we recently rolled out our new Delaget Delivery solution, which aggregates and provides insights into delivery data. We worked with existing clients during development and testing, and when we showed them how many hours their locations were “offline” each month on the major delivery service providers (DSPs) portals such as DoorDash, Uber Eats and Grubhub, they were consistently shocked.
Part of the problem is that the outage can be invisible. If a drive through window is closed or register goes down, everyone in the store knows it. But a DSP outage can come from many sources, and unless someone checks or is notified the restaurant might stay offline for hours. During an outage, the DSP will reroute orders to another location nearby – and won’t send business back until the store issue is resolved.
The cost of downtime: Up to $17,000 per year per store
Looking at data from more than 30,000 restaurants, Delaget calculated that the average restaurant is offline 3.5 hours per month, and each hour of downtime results in $24 in lost revenue. That might seem relatively small, but it adds up when multiplied by the number of restaurants in a group.
Also, this is an average—there are a smaller number of poor-performing restaurants skewing that data. Among that subset, the average skyrockets to 58 hours of downtime per month—$1,392 in lost monthly sales, nearly $17,000 per year—and that’s per restaurant! So an operator of 10 restaurants could be facing $170,000 in losses, just from delivery app outages.
There are four major categories of outage. In each case underlying causes must be addressed, or it will happen again. Here is what we learned about outages, plus tips on how to address or prevent these problems.
- DSP metrics-based closure (70 percent): By far the most common reason a restaurant is offline is that the DSP is receiving reports of problems at the location. Excessive driver wait times, missing items, cold food, and other operations-based issues are among the reasons a DSP might “turn off” a store. Unfortunately, if the underlying issues aren’t resolved, it will likely happen again.
- Driver reports (20 percent): DSP drivers can turn off a restaurant, usually if they arrive and find it closed. Accepting orders too close to closing time, or inaccurate business hours reported to the DSP, make this scenario more likely.
- Intentional pause (10 percent of outages): Workers at the restaurant have the power to shut down the connection, important for when the restaurant might have an emergency closure or running behind due to excessive orders or staff shortages. Sometimes, though, they may forget to turn it back on, leaving the restaurant offline.
- Integration errors: This is the rarest cause but can also be the hardest to diagnose. Essentially, orders coming from the DSPs app or site can’t get to the point-of-sale (POS) system at a location. It might be a login error, or it can be something sneaky, like a weak Wi-Fi signal to the computer or a bad computer cable—a real-world example we heard about.
Taking action on outages
Fortunately, none of these issues are irreversible. Some can be resolved by building in a few common-sense steps to daily routines, while others might take a more holistic approach to operations. Here are few approaches:
- Download all DSP admin apps and enable notifications: Outages happen moment by moment. Don’t wait for emails or the next login. Someone in authority should have the apps on their phone and get notified as soon as an outage occurs. Remember, each DSP needs to be tracked separately.
- Check integrations daily: Make an integration checkpoint part of the store opening, and maybe check it a few times throughout the day. If turned off by a driver last night, turn it back on. Troubleshoot pesky problems—is the Wi-Fi weak, or affected by electromagnetic interference from microwaves? Are those cables plugged in? It can be a mystery.
- Conduct DSP data/menu audits: Make sure restaurant hours and menus are accurate so drivers don’t show up too late, or so people don’t order (and be disappointed not to receive) seasonal items.
- Train employees: Make sure employees know how—and under what specific circumstances—to turn off the DSP integration, and when to turn it back on. Train them on procedures to ensure orders are correct, complete, fresh and ready when drivers arrive.
- Work with a delivery data partner: Get a software with a high ROI like Delaget Delivery, which can automate many of the procedural steps and keep your stores online without manual intervention, and also can help owners dig deeper into underlying operational causes of issues so these can be specifically addressed in training.
Delivery channels are a major source of revenue growth for restaurants and a way for customers to enjoy their favorite food when and where they want. With a few simple steps and a focus on excellent performance, owners and franchisees can drop downtime and make sure they are switched on for success.
Rachel Auer leads product marketing at Delaget, a leading restaurant platform. She writes about delivery app optimization, loss detection, and franchisee reporting.