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All-in-one app for Online Ordering that prioritizes restaurants

I kind of feel like this is the most shit-on idea in the world, but I actually want to make it clear at the outset that I didn't really just make this problem up. It's a problem.

Here's the skinny:

Online ordering apps like DoorDash, Grubhub, and Seamless have been really screwing up when it comes to this industry. Maybe that's not putting it accurately enough. These companies are outright exploiting people; drivers, restaurants, and customers.

For those that don't know about the problem, it is real and it is getting a lot of coverage in the last year or so. Easiest way to get up to speed is to google, "why restaurants hate Grubhub" and then simply "grubhub" after that.

To summarize, restaurants are on these platforms that charge 20-30% commission on each order (sometimes more). This leaves restaurants with little room for profit, and in the worst cases, they actually lose money in the transaction.

On the customer side of things, this results in menu prices needing to be jacked higher online, and other "service charges" being added. There's a story going around where a person tried to order a $5 dish on Grubhub and because of the charges and a $3 tip, the grand total was $23-$26.

So what is a solution I propose? It's essentially the same kind of platform but without the erroneous fees. Yes, it's possible. Yes, I did the math.

The way it works is that restaurants provide their own drivers for delivery -- as many of them already do -- and they can get their charges and commission reduced to a flat 4.9%, which saves them 15-25% per order. This makes a difference.

But I have something for the customers as well. Restaurants can opt-in to a dynamic pricing service which actually helps everyone. It's simple, too: Restaurants have slow periods of the day, so they can offer deals and discounts during those times to fill up tables, and customers can get to eat for cheaper than they would have. This is like how a hotel temporarily lowers prices to fill more rooms when they're slow. Everyone wins.

The biggest pushback I get for this idea is actually: "why would a restaurant use that?".

-- I try to tell them that it makes it so that they are profiting from online orders instead of losing money, but people aren't really trying to hear that. Granted, these guys aren't restaurant owners, but I thought it'd be clear.

The second biggest pushback is why would a restaurant choose your service when they could just get their own platform and app built and reduce the costs to 0%.

-- There's no such thing as 0% in any online transaction, because you have to at least pay the credit card processing fee, and if not that, then you will be paying a monthly subscription to cover those processing fees. In addition to that, a large number of restaurants would prefer not to have to maintain their own app and platform and customers would prefer to just search an aggregator for food rather than installing an app for each restaurant they eat at.

The third pushback is: "There are so many food apps out there already!"

-- Yes, I know this too.

As I'm writing this, I feel like I'm about to hear the exact same things I always hear. This is definitely been the most interesting problem I've tried to solve. If it ever came down to it, I could just abandon this idea because I'm not really passionate about restaurants or the industry. I just saw a problem and thought to provide a solution.

Am I really on the wrong track here? Personally, the only thing I hate is that because of apps like DoorDash and Grubhub, whenever I place an order, I feel bad that this restaurant I like is likely being hurt in some way by me doing this. But at three of my go-to places there's a language barrier (I live in NYC) so phone ordering is too error-prone. I'm glad that apps clear that part up, but I don't want to contribute to the chances that one of my favorite restaurants will fail as a result.

I'm just a person with the means to solve this problem. And I would like to if I can.

on February 1, 2020
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    I believe there is potential here and am actually already many steps down this path.

    Validated a similar idea around a year ago, focused on giving power & control to restaurants and using their own drivers (or related drivers on the app in a pool).

    Problem I have hit is that in the time between validation and development 2 major players in our local market have launched completely dominating the food market and taking all available drivers, most restaurants no longer have drivers available now.

    As a result this product is virtually ready to launch, but on standby while focus is on other projects. Linking in with one of the delivery networks is planned but shifts the concept and value a little.

    Still feels like a strong idea, but wrong place/time in my local region right now.
    But if I was to find a partner who could launch it in a region where the timing was right....could save a lot of time & effort on both sides.....

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      It's interesting that you mention region, because I also believe region plays a very particular role in this -- at least at the outset. May I ask who those 2 major players are that launched in your area?

      My area appears to be begging for it. My biggest concern here is the sheer level of saturation we have. I learn about a new app every single time I visit a restaurant. Not even kidding.

      I'm not sure what these lesser known apps are costing restaurants though, and there are a lot of them. So for all I know, my cost proposition has already been undercut. It's not likely though. The competing apps seem to provide one aspect of the dining experience each. There's one for ordering your food ahead of time, there's another for getting discounts at slow restaurants, one for group ordering, and then there's the big players which let the customer order takeout and delivery in the traditional sense.

      All of this data is distributed across all of these platforms. What I have found to be interesting is this: None of these players can -- at any time in the near future -- provide much more than they already do. It's too costly or risky for them.

      At the same time, I can't do everything myself. But I can get quite a bit done with a very small team.

      One advantage I do have is that to sustain myself, I only would need roughly 100 restaurants that get decent order volume to sustain the business. I've taken no outside capital.

      Is there a DM system on IH? Would love to talk more. I can present you with strong evidence that my area is ripe.

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    I support you, Michael. Do it.

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        Talking to yourself?