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A Bigger Truth About Restaurant Food Delivery

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Photo by Viktor Forgacs on Unsplash

I was listening to Dan Primack’s podcast on Pro Rata and he was interviewing Senator Klobucher who is now publicly and vocally speaking out against Uber purchasing Grubhub and has tried to mobilize against this.

Her argument is that if Uber buys Grubhub (which itself once merged with Seamless) it would mean that Uber Eats / Grubhub would control half the market and that with DoorDash the two together would control 90% of the market. I think that’s a largely flawed fight to be picking and of all the uses of Senator Klobuchar’s I could think of some much more productive fights to be having.

For starters Uber itself has had to lay off 27% of its workforce due to the pandemic and has been severely impacted financially from the crisis with no immediate respite in sight. Its core business was already struggling to become profitable, so having tertiary businesses like food delivery that can deliver needed profits would be welcome to their financial stability. And the market would still have DoorDash and PostMates duking it out as well as the potential that players like Instacart broaden their business one day or Amazon gets into food delivery.

Even more likely is eventual technology disruption where drones deliver foods and make it hard for existing car delivery services to compete. It won’t happen right away but I’ve seen some innovative companies doing exactly this in places like Australia where they are taking a more liberal approach to allowing drone deliveries. Therein lies the advantages of free markets and competition and if we really believed it were that easy to buy off your largest competitor and be a monopolist we’d all be surfing on AOL TimeWarner portals.

But the broader issue that hasn’t garnered much press attention is how the restaurant industry itself is being transformed and what tools a modern restaurant will need to compete. What is the Shopify of the restaurant industry? I have some compelling data that suggests it may just become ChowNow.

We know that the restaurant business already operates on thin margins and many struggle to survive. So when delivery services came along many were willing to pay the fee to try and increase business. It was only about 10–15% of their actual total revenue per month so for many it wasn’t a battle worth fighting — they just put up with the food delivery company fees. Customers were happy and restaurants focused on their in-store business.

The problem for the restaurants is that the more successful the “aggregators” of customer demand become over time, the less power the restaurants themselves have individually. This will largely be true whether you have 2 strong competitors or 5 because unless a delivery company can make a profit it won’t continue to stay in business.

The delivery companies own the customer relationship and can drive traffic to the most profitable restaurants for them. Obviously if you have a great restaurant brand with differentiated food people search for you by name but for many people looking for pizza, sushi, Mexican food, Thai food, whatever, you might go with the choice put in front of you if it’s being recommended or delivered more quickly. The delivery companies also own many of the assets like the photography so they can make certain options look much more attractive.

So just like when Groupon came out many small merchants welcomed the uptick in traffic, without owning the customer you lose the most valuable asset — the ability to re-market to your customer base and encourage them to become more loyal and more frequent customers. You lose the ability to up-sell and cross-sell products. And just like with Groupon the small businesses ended up having many unprofitable customers.

At Upfront we always took the approach that we wanted to back startups that enabled merchants to own the customer relationship and to increase profits by becoming excellent at marketing and serving ones most loyal customers.

So several years ago we backed a company called ChowNow that enables restaurants to offer self-service ordering for pick-up or delivery and the restaurant owns all of the customer information and relationship — ChowNow is simply a SaaS enablement product.

The company has done well over the past several year but never really captured the same press mindshare as the food delivery companies because when a company shows up at your house you get to know that brand rather than the tech that enables restaurants.

Covid-19 has changed all of that. Whereas pickup & delivery may have been 10–15% of a restaurant’s business before it’s currently 100% and when it’s your entire business the thought of paying huge commissions to a third-party delivery service becomes much less attractive. So while many restaurants knew they eventually needed to invest in better order management software, many had been putting it off.

But just as many product or apparel companies were happy selling at Amazon, Walmart or Nordstrom in the past and have lately realized the importance of Shopify and serving customers directly — so, too, are restaurants. Enter ChowNow.

What data do I have to make the case?

  • ChowNow now has 17,000 restaurants using its SaaS platform for take-out and delivery and is adding more than 2,000 / month right now (and trending up)
  • 10 million diners now use the ChowNow ordering platform vs. 24 million for GrubHub, so like Shopify while they built the customer base slowly and with capital efficiency they are now rivaling the bigger players in footprint
  • Last year they were serving 50,000 customers / day through their platform and did approximately $500 million in GMV (the value of the orders placed), this year they are on track to do $3 billion (with a B) and expect to end the year at a revenue run rate that may top $100 million (yes, I asked for permission to publish these numbers).

If you want to see a short spot that outlines the importance of the restaurant industry arming itself with better software tools to serve and market to their customers you may enjoy this 60-second video that makes it clear why it matters. It speaks volumes to why we all love our local restauranteurs and want to see them survive …

https://medium.com/media/dab8c9b98b12a45a4b06435888cc7fc0/href

Or if you want to see the argument laid out clearly by a customer, look no further than Motorino Pizza in NYC who posted this note that appears before you enter their website:


A Bigger Truth About Restaurant Food Delivery was originally published in Both Sides of the Table on Medium, where people are continuing the conversation by highlighting and responding to this story.



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#1948 How to teach your kids to build their own businesses

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Joining me as somebody who I’ve been talking to via email for a while, and I’ve wanted to have on here and I’m so excited that he said yes to an interview.
So many entrepreneurs that I’ve interviewed had little businesses when they were kids. They’re usually so freaking proud of then that they can’t stop telling my producers about it. But so many of the stories ended with the business getting shut down by the school, by a teacher, or by the principal.
Well, today’s guest said, “What if we create a way to encourage kids to sell and create businesses? We’ll teach them how to do it and we give them everything that they need.”
Scott Donnell is the founder of MyFirstSale, which gives kids the life skills and confidence
to sell their products in a safe, friendly online environment.
For a special listener discount, you can go to MyFirstSale.com/Andrew or hapbee.com/Andrew to see more.

Scott Donnell is the founder of MyFirstSale and Hapbee, a wearable device that allows people to pick the feelings they want to express, like happiness, calm and sleepiness.

Mixergy listeners can get the following promos:
www.myfirstsale.com/andrew ($20 off Sign Up)
www.hapbee.com/andrew (Indiegogo discount)

Sponsored by

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More interviews -> https://mixergy.com/moreint
Rate this interview -> https://mixergy.com/rateint



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You Know This Song: Having Confidence to Sing the Soundtrack to Your Life by @NancySolari

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by Nancy Solari 

One of my favorite hobbies and passions has always been karaoke. But as my vision started deteriorating after being diagnosed with Retinitis Pigmentosa, I found I could no longer read the lyrics at a distance. I solved this by having the karaoke host at my go-to bar whisper the words to me while I sang, but when I visited other karaoke places, I ran into issues with the DJ or manager being uncomfortable reading the words to me. In my mind, I felt more secure when they assisted me, but the audience often sat there whispering among themselves, confused by my performance.

One night, I was at a bar with my friends and serenading them with the well-known Britney Spears song “…Baby One More Time.” The manager agreed to whisper the lyrics in my ear, but I had to repeatedly lean down to hear her; my body swaying like a pendulum during the performance. Suddenly, a woman got up from her seat, marched towards me, slammed her hand on the stage, and shouted: “You know this song!” Without another word, she disappeared, and I never encountered her again. But I immediately started singing the song without the manager and to my surprise, she was right: I sang the song perfectly. I realized I no longer needed my “karaoke crutch” of having the words read to me in order for me to succeed.

The next day, I was still perplexed by the mystery lady and my triumph in the bar. But it gave me the chance to understand I had become too dependent on others. The interruption of my song allowed me to recognize this and trust my abilities again.

In order for us to grow into being our most authentic selves, we must plant the seeds of the following qualities…

 

Let disrupters Into Your life

When I performed at karaoke bars, I was content with someone feeding me the words until the I was jolted into realizing the truth: I knew the lyrics and was capable of singing on my own. What I needed was someone to assist in my overall personal growth.

We need these people in our lives, because there are insecurities we cannot recognize in ourselves. The woman who interrupted me on stage saw the discomfort in my body and gave me the impetus to perform without assistance. Our friends and family do the same for us: They give us guidance and provide opportunities that endow us with confidence.

 

Believe in Your abilities

When my vision started worsening, I began leaning on those around me. It was only when I started singing on my own again that I grew more self-reliant. I developed a new habit of listening to the song a few times to learn the melody, and practicing for hours before performing. I discovered if I messed up the verses, I could just smile and make them up as went along: I learned how to adapt and become a stronger.

To find this self-assurance, I had to examine what I liked about myself. Nobody is perfect, but we have to consider a skill we take pride in and let it be our signature trait. For some it might be a physical attribute, and for others it may be intelligence. We can use confidence in this singular feature to build our self-worth in other areas: It becomes like a business card defining us in the best way possible.

 

Play Only Your Soundtrack

 My ability to sing and do karaoke is important because it stems from a time before I lost my sight. The music industry was a career path I went down for a brief period. I was going to music award parties, meeting with presidents of different record labels, and recording my music. As exciting as the industry was, I encountered sexual harassment that made me feel powerless.

One night, I was at an industry party that opened my eyes. I found myself scanning the room and observing new artists who were indulging in drugs. In that moment, I went to the bathroom; tears were running down my face, and I felt adrift in a sea of partiers. I looked in the mirror and told myself: “These are not my people.” I immediately left the party and walked away from the music industry. I found the confidence to step out of that world, and I felt like I gained my soul back.

By confronting what I desired in life and have conviction in my morals, I left behind people I knew would not have assisted my growth. To find our true selves, we need this self-reflection. I found when I journaled or voiced my thoughts into a recorder, I effectively discovered my inner pain. When we examine ourselves through a different prism, we learn what holds us back and can create change in our lives.

The soundtrack to my life is far from complete, as I continue to be challenged by my vision every day. But each time we are confronted with adversity, we must remember our best verses will be about overcoming hardship, and the greatest songs often take years to write. Along the way, when self-confidence meets our authentic selves, we come one step closer to finishing the album to our life.

And that is music to my ears.

 

 

Nancy Solari is an inspiring example of living life with a positive mindset, regardless of the challenges you face.

At sixteen, she was diagnosed with retinitis pigmentosa: a progressive retinal disease that leads to blindness. Over the years, Nancy experienced significant vision loss, but refused to let this dissuade her from following her dreams. She obtained a BA in broadcasting and psychology from the University of Oregon, worked for Good Morning America and Entertainment Tonight, had a successful singing career, and was a top-producing Realtor in Southern California.

Nancy went on to obtain a life coaching degree, and launched Living Full Out in 2008 to help others achieve their goals. An accomplished coach, speaker, and host of the national radio show, Living Full Out with Nancy Solari, she shares her tools for success with audiences and organizations all around the country.

 

 

 

The post You Know This Song: Having Confidence to Sing the Soundtrack to Your Life by @NancySolari appeared first on She Owns It.



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A Bigger Truth About Restaurant Food Delivery

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Photo by Viktor Forgacs on Unsplash

I was listening to Dan Primack’s podcast on Pro Rata and he was interviewing Senator Klobucher who is now publicly and vocally speaking out against Uber purchasing Grubhub and has tried to mobilize against this.

Her argument is that if Uber buys Grubhub (which itself once merged with Seamless) it would mean that Uber Eats / Grubhub would control half the market and that with DoorDash the two together would control 90% of the market. I think that’s a largely flawed fight to be picking and of all the uses of Senator Klobuchar’s I could think of some much more productive fights to be having.

For starters Uber itself has had to lay off 27% of its workforce due to the pandemic and has been severely impacted financially from the crisis with no immediate respite in sight. Its core business was already struggling to become profitable, so having tertiary businesses like food delivery that can deliver needed profits would be welcome to their financial stability. And the market would still have DoorDash and PostMates duking it out as well as the potential that players like Instacart broaden their business one day or Amazon gets into food delivery.

Even more likely is eventual technology disruption where drones deliver foods and make it hard for existing car delivery services to compete. It won’t happen right away but I’ve seen some innovative companies doing exactly this in places like Australia where they are taking a more liberal approach to allowing drone deliveries. Therein lies the advantages of free markets and competition and if we really believed it were that easy to buy off your largest competitor and be a monopolist we’d all be surfing on AOL TimeWarner portals.

But the broader issue that hasn’t garnered much press attention is how the restaurant industry itself is being transformed and what tools a modern restaurant will need to compete. What is the Shopify of the restaurant industry? I have some compelling data that suggests it may just become ChowNow.

We know that the restaurant business already operates on thin margins and many struggle to survive. So when delivery services came along many were willing to pay the fee to try and increase business. It was only about 10–15% of their actual total revenue per month so for many it wasn’t a battle worth fighting — they just put up with the food delivery company fees. Customers were happy and restaurants focused on their in-store business.

The problem for the restaurants is that the more successful the “aggregators” of customer demand become over time, the less power the restaurants themselves have individually. This will largely be true whether you have 2 strong competitors or 5 because unless a delivery company can make a profit it won’t continue to stay in business.

The delivery companies own the customer relationship and can drive traffic to the most profitable restaurants for them. Obviously if you have a great restaurant brand with differentiated food people search for you by name but for many people looking for pizza, sushi, Mexican food, Thai food, whatever, you might go with the choice put in front of you if it’s being recommended or delivered more quickly. The delivery companies also own many of the assets like the photography so they can make certain options look much more attractive.

So just like when Groupon came out many small merchants welcomed the uptick in traffic, without owning the customer you lose the most valuable asset — the ability to re-market to your customer base and encourage them to become more loyal and more frequent customers. You lose the ability to up-sell and cross-sell products. And just like with Groupon the small businesses ended up having many unprofitable customers.

At Upfront we always took the approach that we wanted to back startups that enabled merchants to own the customer relationship and to increase profits by becoming excellent at marketing and serving ones most loyal customers.

So several years ago we backed a company called ChowNow that enables restaurants to offer self-service ordering for pick-up or delivery and the restaurant owns all of the customer information and relationship — ChowNow is simply a SaaS enablement product.

The company has done well over the past several year but never really captured the same press mindshare as the food delivery companies because when a company shows up at your house you get to know that brand rather than the tech that enables restaurants.

Covid-19 has changed all of that. Whereas pickup & delivery may have been 10–15% of a restaurant’s business before it’s currently 100% and when it’s your entire business the thought of paying huge commissions to a third-party delivery service becomes much less attractive. So while many restaurants knew they eventually needed to invest in better order management software, many had been putting it off.

But just as many product or apparel companies were happy selling at Amazon, Walmart or Nordstrom in the past and have lately realized the importance of Shopify and serving customers directly — so, too, are restaurants. Enter ChowNow.

What data do I have to make the case?

  • ChowNow now has 17,000 restaurants using its SaaS platform for take-out and delivery and is adding more than 2,000 / month right now (and trending up)
  • 10 million diners now use the ChowNow ordering platform vs. 24 million for GrubHub, so like Shopify while they built the customer base slowly and with capital efficiency they are now rivaling the bigger players in footprint
  • Last year they were serving 50,000 customers / day through their platform and did approximately $500 million in GMV (the value of the orders placed), this year they are on track to do $3 billion (with a B) and expect to end the year at a revenue run rate that may top $100 million (yes, I asked for permission to publish these numbers).

If you want to see a short spot that outlines the importance of the restaurant industry arming itself with better software tools to serve and market to their customers you may enjoy this 60-second video that makes it clear why it matters. It speaks volumes to why we all love our local restauranteurs and want to see them survive …

https://medium.com/media/dab8c9b98b12a45a4b06435888cc7fc0/href

Or if you want to see the argument laid out clearly by a customer, look no further than Motorino Pizza in NYC who posted this note that appears before you enter their website:


A Bigger Truth About Restaurant Food Delivery was originally published in Both Sides of the Table on Medium, where people are continuing the conversation by highlighting and responding to this story.



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