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Delivery Biz in Third Inning, Food On Demand Speaker Says


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Andrew Charles of Cowen & Company outlined the state of the delivery business at the Food On Demand Conference today.

Joe Veen

Owning the customer is critical for restaurant operators as the delivery and mobile ordering business evolves, said Andrew Charles, senior analyst for Cowen & Company, in opening remarks at the Food On Demand Conference in Chicago today.

“The best thing that restaurant operators can do is they need to own that customer and the customer experience,” he said. In May of 2017, he said, 52 percent of customers Cowen surveyed said they placed their orders through the restaurant’s app or websites; now it’s down to 30 percent as third-party platforms rise. “Restaurants, this is your wakeup call,” he said, and operators should look at delivery companies as their partners.

He pegged delivery as a $40 billion industry, 7 or 8 percent of the entire restaurant business and set to rise to $60 billion. 

He chronicled the rapid progression of development. “Think about the first day, in 2015, it was kind of like caveman discovering fire. What is this? Is it a tool? Is it a threat?” he said was the attitude. “I’m reluctant to say we’re at the halfway point to this though because there are so many restaurants getting into it. I would say we’re in the third inning.”

Tom Kaiser, editor of Food On Demand, noted “the insane amount of money that’s flowing into the space,” as he welcomed attendees to the FOD Conference, the second annual event. A sister publication of Franchise Times, Food On Demand publishes a weekly e-newsletter on the intersection of food, technology and mobility, available at FoodOnDemandNews.com.

Nicholas Upton, news editor of Food On Demand, had interest elsewhere. “Money is cool but what about robots?” he said in opening remarks. “I’m kind of a geek with this kind of stuff, but it’s more than a nerdy outlet for myself. The pace of proliferation is fascinating,” he said.

The Food On Demand Conference continues through Tuesday at the Marriott hotel in Chicago, including sessions on ghost kitchens, the future of the convenience economy, profiles in delivery courage, and the real cost of outsourced delivery.

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The latest news, opinions and commentary on what's happening in the franchise arena that could affect your business.

Tom KaiserTom Kaiser is senior editor of Franchise Times. He can be reached at 612.767.3209, or send story ideas to tkaiser@franchisetimes.com.
 
Beth EwenBeth Ewen is senior editor of Franchise Times. She can be reached at 612.767.3212, or send story ideas to bewen@franchisetimes.com.
 
Nicholas UptonNicholas Upton is restaurants editor at Franchise Times. He can be reached at 612.767.3226, or send story ideas to nupton@franchisetimes.com.
 
Laura MichaelsLaura Michaels is editor of Franchise Times. She can be reached at 612.767.3210, or send story ideas to lmichaels@franchisetimes.com.
 
Mary Jo LarsonMary Jo Larson is the publisher of Franchise Times Magazine and the Restaurant Finance Monitor.  You can find her on Twitter at
 twitter.com/mlarson1011.
 

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