Fast-casual chain Teriyaki Madness announced this morning it has expanded its delivery program to include most major third-party services. The Denver, CO-based company has also inked a deal with Olo, whose technology makes working with multiple third-party delivery services easier, not to mention cheaper, for restaurants to handle.
For many restaurants — even national chains like Teriyaki Madness — the cost of doing delivery in house is too high to reach for now. Third-party services a la DoorDash, Postmates, and others may come with steep fees for restaurants and a certain amount of operational chaos, but they’re still the most economically viable delivery option at this point for many.
Dispatch, Olo’s main delivery product addresses some of those issues with third-party services by streamlining the order process. For one, it integrates all orders into a single ticket stream, regardless of where they come from. As we wrote in January, “Olo doesn’t compete with third-party delivery services; it more or less partners with them, so DoorDash or Grubhub orders placed via Olo go right into the regular queue of tickets, without an employee having to manually input them.”
For Teriyaki Madness, part of the reason behind the partnership with Olo is to drive more delivery orders through the chain’s website and in-house mobile app. As noted in the press release, by year’s end, the company would like to see an even split between orders placed in house and those placed with delivery services: “TMAD’s goal is to have 50 percent of digital orders come in through its app and the other 50 percent originate through third-party delivery vendors.”
In terms of realizing that goal, Olo is an appropriate match as a partner. In a blog post from March of 2019, Olo founder and CEO Noah Glass noted that his company’s goal “is to help our restaurants optimize for that future, and that means getting as many customers as they can to keep ordering directly through them, where they can have a profitable transaction.” That said, Olo isn’t the only restaurant-tech company working to make restaurant operators’ lives easier. Chowly, OrderOut, and Ordermark are all creating different versions of the same concept.
Olo’s system in particular also addresses those controversial commission fees third-party services charge restaurants. Rather than inking a direct deal with, say Uber Eats, then paying a fee per transaction, companies like Teriyaki Madness ink the deal with Olo, and costs owed to third parties are baked into to that deal. (It may slightly raise the delivery fee for the customer.) Teriyaki Madness noted that this process is especially good for franchisees: “The customer pays the delivery fee and the commission goes away, combatting profit erosion and ultimately protecting our franchisees’ bottom lines,” Michael Haith, CEO of Teriyaki Madness, said in the release.
Teriyaki Madness launched its mobile app in 2018 and has been rapidly expanding ever since. The chain has said it plans to double in size by the end of 2019, with delivery and pickup being a big part of those plans. Ensuring a more frictionless delivery process that’s also affordable for every unit in the chain, franchisees included, will be an important part of making that expansion a reality.