The online UK food ordering industry grew by 3.7 billion in 2021 reaching 11.4 billion. This was double its market value compared to that of 2015. This dramatic growth came during the peak of the pandemic as restrictions saw many hospitality businesses close. Online ordering was the only way for customers to purchase their favourite meals from restaurants.
It is estimated that 1 in 12 consumers signed up to a food delivery app during the lockdown. Giant food apps, such as Deliveroo, dominate the market, and all food apps saw an increase in their market share around this time.
Many hospitality retailers, particularly restaurants, signed up with food apps to implement online ordering/delivery services. This was the only way for them to reach their customers and get sales.
Post pandemic this growth in the online food order industry is set to continue as 1 in 10 brits order out or get a takeaway at least once a week.
If hospitality retailers are going to meet this demand, then signing up to an online order platform is going to be the best solution. However, the question remains just which platform is the best one to sign up to?
In this blog post, we will look at the advantages and disadvantages of food delivery services such as Deliveroo and FoodHub as well as how our new online order platform Go Eat compares.
Deliveroo is one of the biggest food delivery apps. The reason being is they were one of the first on the market. Their app has almost 8 million users each month. So, it is not surprising that many restaurants sign up to the platform to gain access to these large amounts of users. However, is Deliveroo the best option?
Let’s discuss some of the pricing and pros and cons of Deliveroo.
A maximum fee of 30% on orders that business owners are charged when the customer uses their platform to place an order.
- It is a well-recognised and established platform and has almost 8 million monthly users. This provides business owners easy access to sell to many customers who use Deliveroo.
- They provide the delivery drivers, so businesses do not have to employ their own.
- The back end provides access to key reporting features, such as how many sales have been taken and how many orders have been processed.
- They charge up to 30% for orders. Like many food delivery services, they charge high fees for any orders that come through their app. This high fee is a customer acquisition cost, which means it is a cost for acquiring new customers. However, many business owners will see orders that come through are from regular customers. This means that businesses are paying these high fees for existing customers.
- You’ll be left waiting for several days for a Deliveroo representative to contact you to get your store up and running. When compared to Go Eat or Food Hub’s platforms, you can have your store up and running in no time after filling in a form.
- Your online store will not be branded. Deliveroo does not give you the option to create an online store that matches your brand. This means you’ll be one of many food businesses on their app with only your name being the key factor in differentiating you from your competitors.
- You will not have a unique URL or QR code for your business. This means the only way for your customers to order through you is via their app. This means you solely rely on people ordering through Deliveroo.
- Deliveroo set its own service charge and passes this on to your customers and keeps it for themselves.
- Your business will be marketed right alongside your competitors. This means a customer who initially decides to order from you might change their mind after spotting what your competitor has to offer, this will cause you to lose sales.
- You must sign on the dotted line. Deliveroo, like many other food apps, makes restaurants sign a contract with them. Businesses that do decide they are unhappy with Deliveroo services will find it difficult to walk away from the company as they may face high exit fees.
- The company does provide delivery drivers but external food delivery drivers have a reputation of being late, delivering the wrong order, and offering poor customer service when delivering food. There are even now multiple complaints that these external drivers sometimes eat the food they are delivering.
Now that we’ve examined the pros and cons of Deliveroo, let’s take a look at FoodHub, another online ordering platform.
FoodHub is owned by Touch2Success, based in Fenton. The company was founded in 2017 and allows customers to order meals from their favourite takeaways. Today the company boasts a network of more than 14,000 takeaway and restaurant partners across the UK and has seen more than one million downloads of its app since its launch.
They charge a monthly fee of £100 with a 3.4% + 20p transaction fee. A high monthly charge like this can make or break businesses.
This could make the company a more appealing option for restaurant owners compared to Deliveroo. However, it would depend on if business owners could afford the platform’s monthly charge.
- FoodHub does not charge restaurants a commission for each order, instead opting for a fixed rental model. As a result, they are on average 15% cheaper than rival platforms.
- The platform does allow merchants to create their online store immediately after signing up. FoodHub allows businesses to create a store that matches their brand.
- It is also a recognised platform, and its established app provides easy access to customers who use the platform.
- They provide delivery drivers, so businesses do not have to employ their own.
- The back end also provides access to key reporting features for sales and orders that have been taken and processed.
Food Hub has many of the same cons as Deliveroo:
- Like Deliveroo, your business will be marketed right alongside your competitors. So, if a customer initially decides to order from you, they might change their mind after spotting what your competitor has to offer, causing you a loss in sales.
- You will need to sign a contract with them. This will make it harder to walk away from the platform if you are unhappy with it especially if you face high exit fees.
- You will also not have a unique URL or QR code for your business . All orders go through their app so your customers will not be able to directly order from you.
- They do provide delivery drivers but again, like with Deliveroo, you’ll still have the problem that comes with dealing with external food delivery drivers. The poor levels of customer service they provide when delivering food can impact the reputation of your business.
Now that we’ve examined the pros and cons of Deliveroo and FoodHub let’s take a look at our online ordering platform, Go Eat.
Our online order platform has been created to allow business owners better control over their online ordering and delivery services.
We have created the platform to be the cheapest on the market, offering Go Eat free to use. With a low 2.4% + 20p transaction fee.
- Once businesses have completed the onboarding process (which can be completed in as little as 15 minutes) they can create their online store complete with their logo, branding, and entire menu immediately. They can have their store set up the very same day and start selling.
- Business owners will have a unique URL and QR code.
- The QR codes can be placed on menus, dining tables, and storefront windows. They can also be stuck onto leaflets. When customers scan it they’ll instantly be directed to their online store to make an order. Customers will be able to avoid the hassle of searching for the business on Deliveroo, FoodHub, or avoid entering a URL. Reducing any obstacles that may arise when placing online orders.
- Businesses have their own online store. This means you will not have to advertise your business alongside your competitors.
- There is no setup fee or contract to sign. This means if a business owner is unhappy with Go Eat, they can easily walk away from it.
- Go Eat provides merchants the opportunity to stop relying on high charging online aggregators and gain control over their collection/delivery services.
- Go Eat also includes key reporting features and VAT management reporting tabs.
- Go Eat allows you to set your own service charge and keep it.
- With the money businesses save they can afford to hire their own drivers. They will also have the option to use our platform for their collection-only services. This, not only, gives business owners the best control over their delivery services, but it also means their business can provide the best customer service possible.
- While Go Eat does not offer access to a large customer base business owners have the option to use 2 platforms for their online orders. They can use Go Eat for existing customers and another online order company to land new customers.
- Go Eat doesn’t provide you with delivery drivers like Deliveroo or FoodHub.
- Go Eat does not have access to a large customer base unlike if signed with Food Hub or Deliveroo.
To sum up
While food delivery apps have all seen growth and continue to do so post-pandemic, they are also seeing a rise in complaints from both business owners and consumers. Restaurateurs struggle with high fees and end customers are also faced with high charges.
In the US Grub hub, Uber Eats and Postmates are facing an antitrust lawsuit by diners who accused them of driving up menu prices by exploiting their dominance in meal deliveries during the COVID-19 pandemic.
In addition, the delivery drivers that these food apps provide do not offer the quality customer service that restaurants would like them to provide to their end customers.
Businesses looking for an easy-to-use platform designed to assist small businesses in making money should consider the Go Eat platform.
Sign up for Go Eat now. You can have your online store up and running in minutes thanks to our four-step signup process. Visit our Go Eat page for more information, or contact our friendly sales team if you have any questions about how Go Eat can work for your company.
Find out more
You can also find more information and exclusive updates and news on our Facebook and Instagram pages. On our hub, you can also learn more about Go Eat, as well as find the most recent online ordering tips and advice for business owners.
You can also learn more about Emergo by checking out our blog and case studies to see how we’ve helped and supported a variety of businesses. Or get in touch with our friendly and knowledgeable sales reps if you are looking for Online Ordering, EPOS, Payments, or Loyalty Systems.