Skip the margins

The recent trends in home delivery of restaurant cooked food may not be healthy for the restaurant industry. 

Aside from the atrocious parking habits of the delivery drivers and the lateness in picking up the prepared food, the impact on the restaurant itself may be negative enough that your food may end up never being picked up let alone delivered.

The point is the Skip The Dishes concept has always been around. Certainly in the U.K., we would drive to the closest Indian restaurant, order the food, a beer and wait for the food to be prepared which usually took one other beer.

The net result for the restaurant was that they sold the food at retail price, they managed to get an order for several pints of beer and we didn’t occupy a table plus we tipped the restaurant staff.

Fast forward to our hyper-convenient society and we struggle to raise an arm to type in an order to Skip The Dishes or a similar service and while we uncork another bottle of wine, we simply wait while our favourite restaurant goes out of business. 

As some of you who have read my columns before know, I am not a big fan of the middle guy.

Take crowd funding for instance. It takes the dollars my charity donors would have given me directly and gives me what is left after they have taken the commission. But what is the commission for?

Well, it turns out that it is nothing other than a search engine optimized website and some outsourced infrastructure that takes my money and charges 10%. 

That is partly tolerable but with Skip The Dishes it is going a step further. It takes a disproportionate fee (around 25%) of the cost of the food, plus the restaurant looses the tip and drink sales. 

The restaurant industry is one of the most margin sensitive industries and must operate within narrow tolerances to maintain profitability. Twenty-five per cent is well beyond the typical restaurant’s margin which means that the restaurant is giving away their food. They make no money, plus no tip for staff.

If you would like to maintain a healthy restaurant environment in your town, my advice would be to skip Skip The Dishes. 


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About the Author

Mark has been an entrepreneur for more than 40 years. His experience spans many commercial sectors and aspects of business.

He was one of the youngest people to be appointed as a Fellow of the prestigious Institute of Sales and Marketing Management before he left the U.K. in 1988.

His column focuses on ways we can improve on success in our lives. Whether it is business, relationships, or health, Mark has a well-rounded perspective on how to stay focused for growth and development.

His influences come from the various travels he undertakes as an adventurer, philanthropist and keynote speaker. More information can be found on Mark at his website www.markjenningsbates.com

He is a Venture Partner with www.DutchOracle.com a global Alternative Investment company.

Mark Jennings-Bates:
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