In the digital age of hospitality, one key trend prevails: customers love the convenience of ordering food online. However, an often overlooked reality is the significant commission fees that third-party delivery services, such as Uber Eats and Menulog, impose on every restaurant order. Surprisingly, a significant portion of consumers remain unaware of these fees.
A recent study in Australia revealed that an astonishing 72% of respondents were oblivious to the commission fees, which can reach up to 30% of the order's value, charged to restaurants by online food delivery platforms. Additionally, the study found that 82% of Australian restaurant owners perceive these fees as unfair, highlighting a growing concern about their businesses' sustainability amidst such high charges.
With projections indicating the Australian online food delivery market will surge by 11.15% from 2023 to 2027, reaching a market volume of US$15.78 billion in 2027, it is more important than ever for the industry to address these challenges.
To counter these costs, some restaurants have increased their meal prices by up to 70% for food ordered via delivery platforms compared to in-store prices. Interestingly, Menulog has supported restaurants' rights to raise individual item prices.
In the past, many Australian restaurants transitioned from dine-in services to takeaways and delivery services. During this period, over 60% of Australians started ordering food from restaurants and takeaways more frequently. However, 72% of these frequent online customers were unaware that up to 30% of their payment went to the delivery app, not the restaurant itself.When informed about these significant fees, 89% of consumers stated they would prefer to order directly from the restaurant instead of using an online marketplace. This percentage rises to 92% among frequent online marketplace users.
This information suggests that by making customers aware of these fees, restaurants could encourage them to order directly from their websites or mobile apps, ensuring they receive the maximum share of their hard-earned revenue. Some have even suggested completely moving away from online marketplaces to ensure customers always order directly from their own platforms.
A shining example of this transition is Desi Dhaba in Tarneit, Victoria, Australia. They have experienced a significant increase in sales and revenue since switching to the WOWAPPS food delivery service.
"Since switching to WOWAPPS food delivery service, I have seen a significant increase in my sales and revenue. The level of service they provide is top-notch, their website is easy to use, and their delivery drivers are always on time. The food is always fresh and delicious, which has helped me retain my customers and attract new ones. I highly recommend this service to anyone looking to boost their sales and revenue," says Akash owner of Desi Dhaba.
By taking control of their digital ordering channels, restaurants can not only circumvent third-party commission fees but also gain direct access to customer data. This empowers them to target returning customers with marketing promotions and loyalty programmes, further enhancing profitability.
In conclusion, the growing concerns surrounding third-party delivery services underscore the need for Australian restaurants to reassess their approach to online ordering. By taking control of their digital channels, restaurants can fully capitalise on the burgeoning online food delivery market.
Get started with commission-free delivery, powered by WOWAPPS, today