While many F&B establishments had online ordering even in the pre-COVID era, the pandemic forced them to embrace this whole-heartedly as their very survival hinged on it. However, most of them leveraged third-party platforms for better and wider customer reach.
However, Parthiv Patel, Co-Founder and CEO of Petpooja, pointed out that they can develop their ordering platform without investing too much finance, time, and effort. Multiple platforms operating on a SaaS model offer a monthly payment module (SaaS) for restaurants to create their ordering website.
So, while earlier these establishments had to pay a developer upwards of Rs 1 lakh to design everything from scratch, they can get their ordering website for fewer than INR 1000 per month from companies like Thrive or Petpooja.
Patel cited how Noshi, a pan-Asian restaurant in Delhi and Gurugram, has seen good business results since adopting the online ordering platform (OOP). Not only have their large base of their loyal customers shifted to direct ordering from the brand instead of opting for aggregators, but they can also take direct orders without a large upfront cost and no commission. He believes this is just the beginning; soon, more restaurateurs will follow suit.
During the pandemic, many restaurateurs were bogged by high rent, but even more, they were affected by inventory costs. How can they leverage technology to reduce this continual financial strain?
“A 5% increase in diner retention can impact restaurant revenue by over 40%.”
– Parthiv Patel, Co-Founder, and CEO, Petpooja.
The first step for optimising any process is knowing where you currently stand. There are two key features in this regard that allow restaurants to know their accurate inventory and food costs and take appropriate action.
The first is the Variance Report, which allows restaurant owners to know the difference between the defined recipe and the actual consumption of raw materials. Suppose 150 grams of cheese is mandated in a pizza. But often, using this report, restaurant owners find that 180 or even 200 grams is used on each pizza. This discrepancy takes away the margin and the customer’s experience since there is a deviation from the original well-researched recipe.
The second is the Food Cost Report that shows the cost of the last dish sold in the restaurant. Raw material prices keep fluctuating, especially for perishables. Hence, it becomes imperative to know the live food cost to adjust the menu item price for any price shocks in raw materials.
To navigate the pandemic’s changes, many restaurateurs turned towards the POS system. Have their expectations from this technology changed over the months, be it ease of use, affordability, and reliability?
Three significant shifts have happened regarding what restaurateurs want from their PoS. The first is the need for simplicity. Due to a temperamental labour market, billers and staff turnover have increased, which led to the need for a simple system such that the staff can adopt it within a short timeframe.
Moreover, restaurateurs have understood the need for a cloud-based system to manage their outlets. Since outlet owners don’t sit at the billing desk anymore, they need a cloud PoS to know what’s happening in the restaurant.
There has been a significant proliferation in B2C apps to help customers interact with restaurants, be it for loyalty, online, or table ordering. Online ordering volumes have also significantly increased. Owing to the number of apps and the high volume for aggregators, restaurants have seen an increased need for integrations to manage all their third-party connected operations from the PoS itself.
What are the merits and challenges of an in-house OOP?
Marketing is the most considerable challenge for an in-house ordering solution. Most restaurateurs believe in the ‘build it, and they will come’ approach. That is just not true. Restaurateurs have to put a lot of effort into marketing to shift their loyal customers away from aggregators and into their OOP.
The second issue is logistics. It’s a Catch-22 since unless there are a lot of orders, it doesn’t make sense to have your fleet, and unless you have that, you won’t be able to deliver orders.
Some third-party hyperlocal logistics players have been gaining ground. But they find it challenging to offer riders more than 70% of the time.
How can they make it more lucrative for customers to opt for their in-house OOP?
Firstly, prices on a restaurant’s OOP has to be lower than on aggregators. Offering discount codes on total orders or reducing menu prices directly, or conversely having higher prices on aggregators, which
is more prevalent, is one way to do it.
However, we believe a more sustainable approach is offering loyal customers a few exclusive dishes only available on the restaurant’s OOP. If it has ten bestsellers, they can offer four as exclusives only on their OOP and keep rotating them. Diners who want those items will have to order off the restaurant’s website only. It’s a sustainable, albeit a little harsh, way to push customers to experience direct ordering.
Ahmedabad’s Lollo Rosso is an excellent example of this. Its buffalo chicken sushi wasn’t available on aggregators for the longest time. I loved that dish. Every time I wanted to eat it, I had to order from its OOP. Since I now have a complete profile on their ordering module and don’t need to enter my information every time , all my orders are now placed on their website.
How can integration of loyalty programs with their POS help convert first-time diners into regulars and regulars into promoters?
Loyalty programs significantly increase retention if used correctly. The integrations allow billers to allocate and redeem loyalty points easily, removing friction from the process.
A 5% increase in diner retention can impact restaurant revenue by over 40%. Hence loyalty and marketing automation to stay on top of customer’s minds must be a principal focus for restaurants.
How can F&B players boost their customer spend with targeted marketing campaigns that seamlessly fuse these campaigns into their POS systems?
The first step to marketing is knowing your customer. With customer order preference and average spending, restaurants can create buckers for classifying diners. They can then send targeted notifications via email, SMS, and WhatsApp to stay on top of mind. For doing all of this, PoS system data is a must because it gives a rich customer profile. For sending automated campaigns also, PoS integration is a necessity since a PoS will give the trigger on when and to whom to fire the campaigns to.
