Even as the vaccine rolls out, warmer weather returns and pandemic-fatigued consumers seek to dine out however they can, the volume of delivery orders remains high. That’s according to ChowNow CEO and co-founder, Chris Webb.
The leader of the online food-delivery platform for small chains and independent restaurants said the company now generates about $2.5 billion in gross order value across its 20,000 restaurant partners. Webb shared some insights David Palmer. Palmer, a financial analyst and industry watcher at the investment bank Evercore wrote in a report that the company isn’t seeing any signs of a slowdown in delivery orders.
Webb said he expects a full return to dine-in traffic will cause a 20 percent slowdown in delivery sales. That would be a significant drop, but the volume would remain well above pre-COVID levels. One effort we’ve covered, and Webb has seen among his partners, is a push to reduce reliance on third-party delivery aggregators.
Restaurant operators are getting used to the surge of digital tools like ChowNow that help restaurants generate their own online orders, but pickup remains a primary channel of growth for off-premises operations. In a pre-COVID interview with Food On Demand, Webb said that has long been a push for delivery pioneers.
“The messaging can be boiled down to something that’s very easy, but I don’t think people do a very good job of it today,” Webb said. “You as a customer will pay higher prices if you order off a marketplace, so if you order off of Grub or DoorDash or Uber Eats, nine out of 10 times you’re paying a higher price for the exact same order.”
Webb told Palmer he believes restaurants on the system will reduce the number of delivery partners to only those that make the most sense as far as coverage in their generally limited markets. He said they would likely push back on the commission rates, too, though he said that push is just beginning.
The issue of staffing, however, is affecting the overall quality both on the restaurant side and the delivery side, according to Webb. He said there is evidence that staffing pressure is leading to slower delivery times and lower service quality. That issue, however, is expected to mitigate as stimulus benefits expire and the vaccine rollout continues.
As for the big question of closures, Webb said data from his system shows the scary number of closures is not reflected among his 20,000 partners. The typical 1.6 percent closure rate he sees on a historic basis has not changed in recent months. That suggests operators who jumped on digital tools prior to or at the onset of the pandemic will largely make it through—and that many of the reported 110,000 closed restaurants in the U.S. were already on the brink.
