FOOD DELIVERY MAY DELIVER
March 2, 2018
Of the companies listed in the Original Fortune 500 Index, only 12% remained in 20161. On top of that, the “life expectancy” of businesses is shorter, and shrinks even more in competitive landscapes such as the restaurant industry. How do so many businesses reach the top but struggle to keep their foothold? And what’s a restaurant or manufacturer to do?
The common thread among the survivors is their ability to embrace change. When food delivery and third-party players first came to the market, many believed them to be a novelty or passing trend. Little did they know nearly half (48%) of Gen Z would come to order food for delivery at least once per week2. Or that 70% of Millennials plan to maintain or increase their third-party food delivery use in a given year2.
While the rise of off-premise dining sounds the alarm bells in some operators’ minds — for fear of decreased quality and lower margins to name a couple concerns — consumer demand shows it isn’t going away, and a handful of restaurants are at the forefront of embracing this change. Full-service restaurants lead the third-party delivery movement2, giving customers the ability to enjoy sit-down-style, restaurant-quality food from the comfort of their home. And in 2018, we will see additional segments jumping on board. Just this month, fast food leader Yum Brands launched delivery with GrubHub.
Restaurateurs are faced with the challenge of adapting to a changing market, and foodservice manufacturers have a unique opportunity to equip them to not only persevere, but to come out on top. Whether this means working alongside partners to serve foods that stand up in the journey from BOH to front door or incorporating items that increase margins to offset delivery costs, this is the time to start that conversation and make an impact.
1 Fortune 500, 1955 & 2016 Reports
2 Technomic Consumer Direct, 2017
