The huge growth in off-premise dining has transformed the restaurant industry and funneled increasing revenue into the local and franchise restaurants. But as consumers grow more reliant on takeout and delivery, demand for more—and better—cuisine grows with it, producing a heaping side-helping of competition for restaurants.
Currently, dine-in foodservice accounts for 43% of orders, meaning that more than half of orders are now off-premise (18% delivery and a whopping 40% takeout). On top of that, 22% of consumers make takeout or delivery a regular part of their food routine—and it’s growing. Serving these customers is a bigger opportunity than ever but meeting the challenge of consumers’ evolving expectations and tastes is crucial to capitalizing on that opportunity.
While takeout is still favored more than 2:1 over delivery, even that preference is shifting as delivery becomes more accessible. More than 1/5 of consumers are making the switch to delivery, but nearly 1/3 of those in the 18-34 demographic are doing the same. The availability of delivery from more restaurants—especially with the growth and adoption of third-party delivery services—is helping to drive this trend. Delivery and takeout help consumers enjoy their favorite cuisine on their schedule and in the comfort of their own homes. Delivery adds even more convenience and is worth the fees and the wait, especially since it can be productive time.
Those third-party services offer a great advantage for restaurants that can’t afford the overhead of an in-house delivery infrastructure, but for the time being consumers are still preferring to order directly from the restaurant rather than through these services (by more than 3/4). They have a stronger trust for the established restaurant, so don’t expect these third parties to do all the heavy lifting of expanding your delivery reach. The communication and promotion are still your responsibility, and if you can’t afford your own delivery employees you may have to hustle to win over customers who are still uncomfortable with third parties (especially if your most direct competitors offer in-house service).
What’s Driving Takeout and Delivery Growth?
There are a number of factors feeding the takeout and delivery increase, and these are the top 4:
- Desire to Be at Home: consumers still want great food, and their restaurant-favorite cuisine, but many of them are just more comfortable eating at home.
- Reduced Wait: patrons wait an average of a half hour for dine-in food delivery, but consumers prefer on average 22 minutes—which they can control more through their choice of delivery or takeout.
- Family Size: restaurant meals can be costly for larger families—whether dine-in, takeout, or delivery. There is substantial interest in bundled family-size meal offerings from restaurants, particularly for delivery.
- Technology: avid mobile app and website users have increased their use of takeout and delivery because they find this technology easier to use and a helpful tool to customize their orders and get exactly what they want.
Off-premise food service has a bright future of growth to meet the demand of consumers. By understanding the needs and values of patrons—in-store, takeout, or delivery—restaurants can benefit from this booming business format and continue to reach a growing customer base.
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