How online ordering can negatively impact your catering business

By Erle Dardick, MonkeyMedia Software

We all know how important online and mobile ordering has become for the restaurant industry.  It has for ALL industries, hasn’t it?  Think of hotels, airlines, books, flowers, and on and on it goes.  Online ordering for every retail product and service on the planet is growing like gangbusters because for the first time in the history of the world, the act of ordering is being put into the hands of the consumers. They can order when they want and how they want without having to slow down and explain to somebody on the other side of the counter what it is they want. The digital world is moving so quickly that we have no option but to invest in new technology to keep up with modern times.

Sadly, like every fast moving technology, this creates a terrible adoption dynamic for our industry. The landscape is so confusing for restaurateurs, how is anybody supposed to know what the right decisions are for their organization?

You see, the data is being presented positively in the press. Restaurant brands such as Domino's have claimed that in some markets, 70 percent of their orders are coming in through their online ordering technology. And it is true. Online and digital ordering are here to stay and Millenials have spoken loud and clear. If you don't offer a digital ordering solution to your customers you will get left behind.

But what you don't know is that Domino's (and others) have their backend order fulfillment work logic locked down and well integrated with their online ordering solutions. So although it's true that their online ordering transactions are growing very rapidly, it's only happening because they are executing flawlessly, every single time. That is bringing customers back, over and over. It's not about online ordering. It's about flawless order execution.

Pizza operators figured out how to execute delivery long before digital ordering was ever conceived.  And so, the reason their digital ordering platforms are so powerful is because they have their operations locked and loaded.

Thing is, there is a caveat to online ordering that our industry just doesn’t understand yet. A trap door if you will. And this trap door concerns me greatly.  If the trap door was visible, it would have a BIG sign on it that says “CATERING.”  Don’t open the door unless you have your business strategy and execution flawlessly locked down.

Most of our industry thinks that just putting up a menu online and driving digital catering transactions will result in flawless order execution.  I see it over and over.  Time and time again.  And so, this is where it all unravels.  All the digital ordering technology providers will tell you that their systems can take catering orders.  And while this is true, this is where the new technology will kill your catering operation. 

You see, due to our lack of understanding of how to execute catering out of our restaurants, if we allow online orders for catering to be extended through this relatively new technology, we are doomed to fail unless we understand how to operate this business on top of our existing restaurant operation. Why?  Because catering is a different business. It always has been, and always will be.  Catering out of restaurants is an operations-based business challenge and one that our industry has done a terrible job at solving.

Today's online ordering providers are creating confusion in our industry with their messaging  We all know that the venture capitalists and private equity markets have invested more than $1 billion in online and mobile ordering technology in the last 12 months. They are using these funds to market to restaurants and build sales teams that are promising everything under the sun to restaurants, including solving their catering operations. But as in industry we are just beginning to understand the subtle differences between our dine-in and takeout business versus catering. We now understand that drive-thru has its own execution dynamics. And we have invested heavily into our operations to differentiate the manufacturing and distribution channels of drive thru versus our dine in or takeout businesses for decades.  We have become experts at it!

And so why is it that when it comes to catering out of our restaurants we simply pop up a menu on our online ordering application and believe that's all we have to do to succeed at catering?  In order to succeed at catering we must understand how to execute it and then look for the right kinds of technology solutions and partners that will enable us to deliver a flawless and scalable experience.

And so, if you simply put up a catering menu using your new fancy online and mobile ordering solution, and you direct your provider to inject those orders into your existing POS infrastructure, you are doomed to fail. Just like the last three decades of our predecessors, in order to do catering well out of restaurants, operators have had to work around the POS for order execution. The operational dynamics are completely different than our day-to-day restaurant operations.

Everywhere I go, every online ordering company I run into says that they can “Take catering orders”. While this is true, (anybody can take a catering order), online ordering is not going to solve the operational challenges associated with the manufacturing and distribution dynamics of flawless catering order execution.  

Let's talk catering.