Delivery Only Takeaway -- Thoughts?

[markcoznottz]

sgrimshaw said:

markcoznottz said:

Chinese near me charges the same price as we were paying 20 years ago, and aren't skimping on portions either, I have no idea how they make a profit.

Probably best not knowing

I don't have meat, just noodles and prawns I can't see how they can buy below a certain price ?

[maffer7]

Thanks for all of the comments people, helpful.

The Deliverence post - ouch! That is exactly what I had in mind, albeit in a smaller City. Looking at it, it did work for a long time but as you mention, when they expanded they fell over. Others have also mentioned tight control of costs, staffing etc, seems key.

I'm going to go ahead, but I really like the idea (from somebody here) of having different brands for each food type so I'm leaning on setting up one as a trial run for a few months. Clearly this means we'd lose out on some of the benefits of having multipul food options, and some economies of scale but it will give a good insite into the market and the mistakes we make will be less painful (hopefully).

I'll post an update in a few months with progress.

[Countdown]

markcoznottz said:

sgrimshaw said:

markcoznottz said:

Chinese near me charges the same price as we were paying 20 years ago, and aren't skimping on portions either, I have no idea how they make a profit.

Probably best not knowing

I don't have meat, just noodles and prawns I can't see how they can buy below a certain price ?

The reason they're charging the same is because it's a dog-eat-dog market. Low barriers to entry, reasonable supply of cheap labour etc etc. 20 years ago these takeaways were a license to print money. Nowadays the competition is a lot tougher and there is a high churn rate, especially in large cities. The reasons they can be relatively cheap...:

Employing staff cash-in-hand for £5/hr (or less if they don't have the right to work in UK)
Not registering for VAT
Not bothering with takeaway delivery car insurance

Customers don't care as long as the food is nice/cheap

[21TonyK]

maffer7 said:

Thanks for all of the comments people, helpful.

The Deliverence post - ouch! That is exactly what I had in mind, albeit in a smaller City. Looking at it, it did work for a long time but as you mention, when they expanded they fell over. Others have also mentioned tight control of costs, staffing etc, seems key.

I'm going to go ahead, but I really like the idea (from somebody here) of having different brands for each food type so I'm leaning on setting up one as a trial run for a few months. Clearly this means we'd lose out on some of the benefits of having multipul food options, and some economies of scale but it will give a good insite into the market and the mistakes we make will be less painful (hopefully).

I'll post an update in a few months with progress.

Good luck with it. I'd be interested to hear how it goes.

[MCLARENSLR]

I wonder if renting out serviced kitchens to other businesses could be viable similar to the way serviced offices work. Get a very large warehouse and kit in out with facilities for an Indian takeaway kitchen, Chinese takeaway, Pizza Kitchen, Chip Shop etc. Rent the kitchen out to individual tenants and also offer your tenants a delivery service charging one pound per delivery. If you had 4 or more tenants paying you rent and you were making money on the deliveries would be a lot less work than making the food yourself and could provide a lucrative income and the business model could be repeated in different towns and cities.

Edited by MCLARENSLR on Monday 28th August 21:19

[daemon]

Countdown said:

The reason they're charging the same is because it's a dog-eat-dog market. Low barriers to entry, reasonable supply of cheap labour etc etc. 20 years ago these takeaways were a license to print money. Nowadays the competition is a lot tougher and there is a high churn rate, especially in large cities. The reasons they can be relatively cheap...:

Employing staff cash-in-hand for £5/hr (or less if they don't have the right to work in UK)
Not registering for VAT
Not bothering with takeaway delivery car insurance

Customers don't care as long as the food is nice/cheap

The other issue with an online only takeaway is the paper trail it develops all the time. With bricks and mortar takeaways theres a lot of cash comes across the till thats never seen on the books or can be used to pay casual staff cash in hand.

If all your business is through Just Eat, etc you're at an immediate disadvantage to bricks and mortar kebab shops / chinese restaurants because they're not having to declare all earnings and you would be.

Yes, there are ways around it, but not to the extent a bricks and mortar takeaway would have.

[hyphen]

plasticpig said:

Algarve said:

I want Indian food made by actual Indians.

Good luck with that. Something like 90% of Indian restaurants / takeaways are run by Bangladeshis

Are you sure? The Pakistani's also seem heavily involved. All of Bradford for example.

I suppose the easiest way to get Indian food made by Indians is to go Veggie, as British-indian/migrant Indian Hindu's will probably be behind it.

Countdown said:

The reason they're charging the same is because it's a dog-eat-dog market. Low barriers to entry, reasonable supply of cheap labour etc etc. 20 years ago these takeaways were a license to print money. Nowadays the competition is a lot tougher and there is a high churn rate, especially in large cities. The reasons they can be relatively cheap...:

Employing staff cash-in-hand for £5/hr (or less if they don't have the right to work in UK)
Not registering for VAT
Not bothering with takeaway delivery car insurance

Customers don't care as long as the food is nice/cheap

Depends on what you are selling and how you sell it. There will always be a percentage of people in your area, willing to pay a bit more if you deliver a higher quality item- lots of young professional couples about.

If I was doing such a venture, it would be identifying the food that was not so much available and then targeting that market, starting off with a good chef and team. For example a lot of areas in the country still don't have a wood fired oven high quality healthier Pizza place, so I would go that way- many around this way who have done are now chains. In the same way high quality grilled kebab skewers are often very busy, so why do yet another cheap Donner slab from the wholesalers.

Reading the OP's post, he mentions pretty much everything apart from the word 'chef', so I guess he is targeting the masses though so as you say, unless he gets the branding spot on, it will be price sensitive.

I would consider getting a tiny cheap city location as well though, that way your customers will think it comes from there even if it comes offsite. Good luck.

Edited by hyphen on Monday 28th August 20:36

[TwistingMyMelon]

48k said:

maffer7 said:

Love peoples thoughts on A; it as a business idea and B; would you order from something like this.

My gut feel is you will make a small fortune from this. If you start out with a large one. You need to find a unit with A5 planning permission of a big enough size that you can have all the woks, fryers, tandoors, pizza ovens, normal ovens, prep space, storage etc for all the different cuisines. The unit needs to be close enough to a catchment area that you've got some customers to deliver to and the foot is still hot and edible when it gets to them. You need to pay rent, service charge, business rates, insurance, utilities, telecoms, security, pest control etc to run the unit. You need vehicles, branding and hot boxes to transport the food. You need to staff the kitchen with experienced chefs who can cook the cuisines. You need staff to process the orders, do the buying, do the deliveries, run the operational side. You need to pay those staff, give them paid holidays, pensions, have employers liability insurance etc. And you need to do this from a business that is open in the evenings only and probably generates most of its income on 2 or 3 days of the week. Assuming you can advertise / market the business enough that people will try, and keep returning to, your generic jack of all trades take away rather than the specialist one trick pony down the road.

Best of luck but I can't see it working as a business.

Great post

Agree with all

OP do you have any experience in takeaways or food businesses ?

Edited by TwistingMyMelon on Monday 28th August 23:46

[skwdenyer]

48k said:

You need to find a unit with A5 planning permission of a big enough size that you can have all the woks, fryers, tandoors, pizza ovens, normal ovens, prep space, storage etc for all the different cuisines..

Commercial kitchen (no walk-up) is B1. Yes I know that makes no sense, but the Land Use Gazetteer is your friend.

[superlightr]

daemon said:

Countdown said:

The reason they're charging the same is because it's a dog-eat-dog market. Low barriers to entry, reasonable supply of cheap labour etc etc. 20 years ago these takeaways were a license to print money. Nowadays the competition is a lot tougher and there is a high churn rate, especially in large cities. The reasons they can be relatively cheap...:

Employing staff cash-in-hand for £5/hr (or less if they don't have the right to work in UK)
Not registering for VAT
Not bothering with takeaway delivery car insurance

Customers don't care as long as the food is nice/cheap

The other issue with an online only takeaway is the paper trail it develops all the time. With bricks and mortar takeaways theres a lot of cash comes across the till thats never seen on the books or can be used to pay casual staff cash in hand.

If all your business is through Just Eat, etc you're at an immediate disadvantage to bricks and mortar kebab shops / chinese restaurants because they're not having to declare all earnings and you would be.

Yes, there are ways around it, but not to the extent a bricks and mortar takeaway would have.

go to a casino - have a look at what type of person is playing - from my experience there are a lot of Chinese takeaway owners playing with cash. My friends dad being one of them a number of years ago.

[Countdown]

superlightr said:

go to a casino - have a look at what type of person is playing - from my experience there are a lot of Chinese takeaway owners playing with cash. My friends dad being one of them a number of years ago.

I don't think that's connected to them being takeaway owners. It's more likely to be because the chinese are big gamblers.

[daemon]

Countdown said:

superlightr said:

go to a casino - have a look at what type of person is playing - from my experience there are a lot of Chinese takeaway owners playing with cash. My friends dad being one of them a number of years ago.

I don't think that's connected to them being takeaway owners. It's more likely to be because the chinese are big gamblers.

+1

Notorious for it.

[LayZ]

Quite like the idea but I think you'll struggle to market it without a 'niche' - just being 'all takeaway' is hard to differentiate from JustEat even though their model is obviously different as an aggregator.

How about doing something without all the prep costs - buy in high-end sushi and do delivery on that? Might only work in a large city though, but you could try it on a much smaller scale.

[hyphen]

Ignore all the sensationalism, and this may be a useful read OP.

Deliveroo Editions http://www.dailymail.co.uk/news/article-4911782/De...