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Monday
Sep252017

Call notes on delivery

According to operators that we recently spoke with:

  • There is a problem with fraud associated with delivery. Dishonest consumers take delivery & then call their banks to say that they never ordered the food & initiate a charge back that the operators must eat (charge-backs were something like 3x the normal rate). Also, delivery customer is totally different than core with 1AM business very strong & also a possible explanation for higher fraud frequencies.
  • The pizza segment maybe losing share in delivery. For instance, a consumer travelling on business & staying at a hotel (& who does not want to go out for dinner) used to have limited delivery options with pizza being the most prominent. But now the consumer can choose breakfast or casual dinner options as well. This would also be true of the Millennial late night crowd.
  • Operators must figure out whether their servers should get a tip for assembling off-premise orders. They currently do not get paid, but this could be an issue and potentially raise the cost of these orders.
  • QSR players may not require mobile apps because you can pick-up your order in 3-4 minutes after placing it at the drive-thru & there is no wait. Apps may be more relevant to chains with longer wait times.
  • Delivery may have limited demand from inebriated late-night customers who don't want to drive.

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