Restaurant deliveries offering mixed picture during lockdown

Initially considered to be a lifeline for the restaurant sector, restaurant deliveries are proving not to be the answer for all

Updated on 02 April 2020

Restaurant deliveries offering mixed picture during lockdown

Over a dozen days into restaurant lockdown and, if our household is anything to go by, the food that’s appearing on the table is starting to look and taste a bit stretched and samey. So, it’s understandable that last weekend saw a surge in takeaway orders as people looked to treat themselves to something different and this weekend will surely be the same.

Hakkasan, a recent convert to the deliveries game and a restaurant used to controlling precisely when its diners eat, had to turn off its delivery service for a while as it became overwhelmed by the volume of orders coming through on its first Saturday night.

Punky Patra-Yanan of Rosa’s Thai Café, a group of 19 restaurants mainly in London, reports similar issues with increased demand. “There’s been a massive ramping up in demand since the compulsory closure of restaurants” she says. “Orders are up and driver availability is down which means wait time is a bit longer, but people generally understand.”    

However, reports from restaurants operating in this sector are not all positive. 

It’s true, the number of restaurants that have been signing up to delivery aggregators like Deliveroo, Uber Eats and Just Eat have rocketed.  But plenty of restaurants who initially thought the takeaway opportunity might be a lifeline in this period, have found this sector much harder than they expected. “It’s a different model” says Patra-Yanan. “There are a different set of issues with the delivery side.” 

Some restaurants, that were added last week to the takeaways channel on SquarerMeal’s website, have already decided to call it a day and have closed up shop. Chinese standard bearer Good Earth, classy ramen group Tonkotsu and pasta king Padella all opened for or carried on with takeaways, only to close within a week. It’s hard to know whether the problem was the costs of opening not being covered by the revenue or concerns over staff safety. Or maybe the government’s message of self-isolation is being taken at its word.  

So, the hopes that the restaurant industry would be experiencing growth in takeaway, to make up in part for site closures, do seem to have been premature. Overall takeaway volumes have reportedly declined substantially, and the reasons are various. In London office lunchtime orders, often to feed whole teams, have collapsed like a deflated soufflé. Some of the biggest chains, like Wagamama, Nando’s and McDonalds, which accounted for huge volumes of deliveries, have shuttered their doors completely, posting concerns over staff safety as a key reason. Other significant groups like The Giggling Squid, with 36 restaurants across the country, have followed suit.  

Indeed, it would seem the UK government's furloughing pledge, in which 80% of staff wages get covered by the government, may be another disincentive to keep operations going. 

The closure of the big chains like McDonald’s and Wagamama, with their broad regional coverage, is not only having a devastating effect on what the delivery apps can offer but also on their ability to operate efficiently, as well as their revenues. The big chains not only gave them wide appeal but also wide reach - and crucially they helped keep the delivery personnel busy. 

The delivery aggregators have responded by offering restaurants faster payments and reduced commissions as an incentive to keep going, and Deliveroo’s new TV campaign, declaring that “they are here to deliver”, is a move designed to send positive messages to restaurants and diners alike. 

For some it is certainly working. Rosa’s Thai have added 4,500 new customers through the Deliveroo app since the shutdown began.  This means busy staff and good staff morale, which is being boosted further through the feeling they are helping to do their bit via various charitable NHS initiatives.  

From Hakkasan’s perspective, performing a takeaway service in these grave times is about more than simply making a bit of money.  It’s about staying in touch and sending a message to their customers that the company is there for them. It's about good, positive communication and a much needed sense of continuity. A point also made by fellow high-end operator Hide Above. 

Early indications from Asia may point to a quick recovery in deliveries once confidence starts to return but, like everything, who’s to say what this world will look like then? 

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