Feb. 16—When the pandemic blew up Steve Ambrose’s restaurant marketing business, he pulled together a Plan B.
The locally sourced food delivery service called Appetit is only 4 months old. It runs on a browser page, not an app. It requires custom installation, lacking plug-and-play slickness.
Yet it supports 125 restaurants, adding more each week. Appetit’s working out the kinks, but it’s $99 a month, and restaurants keep 100% of their menu prices.
So far, Ambrose’s Hail Mary is answering the prayers of local restaurants, a rare spot of bright news in the grim, gray February of the worst restaurant year ever.
Appetit reviews range from positive to raves, with owners praising the service for helping them survive, and even grow, with a truly local delivery partner.
Today, Appetit’s biggest problem is finding enough qualified drivers for its expanding business. With bigger average orders and bigger fees for extended delivery areas — when a Williamsville customer wants, say, a burger from Orchard Park — drivers are making $20 to $25 an hour, Ambrose said.
“Our average check size is $56 versus DoorDash, McDonald’s, $10 or $20. So our drivers are making $13 to $15 an order. It’s good money.”
Today, he and other Appetit principals are filling in, making deliveries themselves, in between troubleshooting installations with new restaurants and communicating with programmers in the Philippines who are doing some of the digital work. Ambrose’s partners include Robert Heil of SLA Solutions, who has spent years helping applicants get liquor licenses, and Sam Marrazzo, chief innovation officer of the Buffalo Niagara Medical Campus, who plays a vital technology assistance role, Ambrose said. (Drivers can apply here.)
Pandemic quarantines keeping people home, and closure of dining rooms, created gloriously profitable conditions for app-based food delivery services like DoorDash and Grubhub. Food app revenue doubled in the wake of coronavirus, giving those companies record profits.
The restaurants in whose work they traffic often suffer, though.
“I lose money on almost every order that an app picks up,” said a Buffalo restaurateur with two locations. Restaurants pay up to 30% of menu prices to the apps, more than their profits on most items.
It’s worth it, so far, the restaurateur said, because he can’t think of any alternative to generate enough revenue to keep his key people employed. But, “it’s a deal with the devil.”
Appetit’s $99 a month flat fee, combined with increasing menu prices 2.5% to offset credit card fees, gets it done.
“I can’t afford 10% to 30% of my sales price going to a third party, which is what Grubhub and DoorDash are looking for,” Café 59’s Leon Rung said. “(Appetit’s) site’s a little rough, as you would expect from something thrown together by 30-somethings. But it works. People seem to like it. And again, they’re very responsive in fixing the small glitches that have occurred.”
Don’t expect plug-and-play, but do expect problems to be worked out expeditiously, and expect to keep more of your customer’s money, said Roy Bakos of Café Godot.
“We did $289 in delivery orders today,” he said last week. “The idea that I would have lost $100 in revenue had I done it through DoorDash or Uber Eats would’ve made me not do delivery, because any profit I would have made we would have lost — it would have gone out the door.”
Now, at Café Godot, “If my sandwich costs $10, I get $10 for every sandwich I sell.”
Elizabeth Dean, of Off the Wall Sandwich Co., in Orchard Park, said Appetit’s drivers make a difference, too.
“I feel like their drivers actually care about the distribution of the food,” Dean said. “We want people to receive their food the way it should look, not the hamburger bun fell off when they hit the corner at 75, because they’re 18, just got their license and got approved to deliver.”
Appetit is Off the Wall’s first venture into delivery. So far, the restaurant’s total sales are up 25%, at least. “We’re able to deliver to so many different areas, instead of just being confined to one area,” Dean said. “Appetit actually will deliver all the way out to Williamsville if need be.”
Pat Ryan, owner of Fat Bob’s Smokehouse, said, “We’re not doing the volume that we would do on some of these other platforms. But at the same time, we’re saving money, and we have more control over our product, and the platform.”
In a business landscape dominated by faceless megacorporations, it’s a relief to deal with a partner face to face, even if you’re wearing masks, Ryan said.
“We’re all trying to get through this together. Why do we want to give our money to one of these big companies that really doesn’t care about us? (Appetit’s) office is three blocks away. We’re giving them feedback that they’re literally using to amend their platform to make it easier for us, and feedback from the customers’ perspective. And they go back to the developer, and they change it.”
When it comes to what Appetit has to offer Western New York, a growing number of restaurateurs are thinking like Ryan: “Hey, let’s work with this company, let’s grow locally with this company. Because if they became, you know, a much larger company, we were one of the original partners. To me, that’s the ultimate goal at the end of the day.”
This article is written by Andrew Galarneau from The Buffalo News and was legally licensed via the Tribune Content Agency through the Industry Dive publisher network. Please direct all licensing questions to [email protected].