Philly-area software firm aim to deliver food more cheaply than DoorDash or UberEats


Only two companies, DoorDash and UberEats, both based in San Francisco, organize five out of six meal deliveries at restaurants in the United States.

More than half of Americans used meal delivery services, and the typical customer spent more than $ 200 in the first quarter of 2022, according to Bloomberg’s second measure.

But their charges now consume between 25 and 40 cents of every dollar we pay for meals delivered, harming consumers and profoundly reducing restaurant revenue, said Andrew Simmons, head of the Restaurant Marketing and Delivery Association, a national-based group in Texas. Its 550 members employ 30,000 local drivers, many of whom also deliver regularly to DoorDash and UberEats.

So this month, the Simmons partnership is challenging Silicon Valley’s dominance in the world of food delivery, with online systems built by Zuppler, a 10-year-old, 70-person software store based in a former glass factory in Conshohocken.

“Zuppler is building our platform for our new website, LocalDelivery.org,” scheduled to go live in mid-June, or as long as your group registers enough restaurants and delivery services to make it viable, Simmons said. Consumers will use an application to order.

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According to him, local services have cut online ordering and delivery costs by half, making it easier for restaurants to absorb the system fee of 50 cents per Zuppler order. The system should also improve the service by giving users local people to call when problems arise.

The big food delivery services, which also include GrubHub, a Dutch-owned successor to the Philadelphia-based Seamless Delivery System in Aramark, “charge a lot of money, but there is no local ownership when problems arise,” Simmons said. And until now, local delivery services lacked the fast-paced software that restaurants and customers were trained to expect from the industry giants in the age of smartphones.

And with Zuppler’s new platform, “the money stays in the community.”

“The biggest problem for freelancers is that there’s no way to compete with DoorDash, GrubHub and Uber,” said Chris Heffernan, a former AT&T manager who left in 2011 to start DLIVRD, a Horsham-based delivery service (and member of the Simmons association). ) which is now active in 61 cities in the United States.

“But with this app, which I’ve been testing in beta, you can search from any address, go to a list of restaurants in your area, you can order directly from their menus and we deliver or another local service, wherever you are.” , said Heffernan.

That levels the playing field and eliminates the costly marketing subsidies (meal promotions, Super Bowl ads) that Heffernan said have increased the costs and burdens of the national delivery giants.

LocalDelivery.org is a big step for Zuppler, which previously developed its own ordering service for independent restaurants on Zuppler.com.

Zuppler’s modest success in this business – as a private company that does not share finance, but claims rapid growth – caught the attention of the dealership association, which negotiated plans with Zuppler founders to launch LocalDelivery.org and announced plans at its group’s annual conference. in April.

Ed Barrett, co-founder of Zuppler with Shiva Srinivasan, said that “big companies like DoorDash have spent billions to change the behavior of consumers to place orders online. getting to where the market is. But restaurants don’t like services being so expensive. “

Barrett said restaurants are at least a decade behind their previous business – the travel industry – in moving online and are now following a similar path. He worked for the Philadelphia-based travel giant Rosenbluth International and led the team that began its online corporate travel booking services from 1995 until its sale in 2003 to American Express.

When he left a few years later, a former Rosenbluth chief referred him to Srinivasan, who moved to Philadelphia to pursue a master’s degree in computer science at Drexel University. Srinivasan led technology groups for the former Synygy and for TV Guide.

Preferring to be his own boss, Srinivasan left American corporate life and, along with a couple of colleagues, created an online portal, APlaceToDine, to book tables at the best New Delhi restaurants in India.

“We were very successful, because we had a lot of traffic. The only problem was that we didn’t make any money. “The restaurants didn’t need enough service to pay a profitable premium.” We went to India very early. So I went to launch something in the US. UU.

Back in the Philadelphia area, and married to the woman who had defeated him for an internship at Drexel, Srinivasan met Barrett on a Ruby Tuesday. The couple designed an easy-to-find portal that would direct consumer traffic to places to eat and arrange delivery.

Writing software was not his main expense (Zuppler’s staff includes low-cost developers in India and Romania, as well as in Conshohocken). “The expensive thing is to acquire customers,” Barrett said. “People forget that it was a very expensive proposal, to get it [corporate employees] to stop faxing orders. When DoorDash was launched, they flooded the market with millions of postcards to attract users online: $ 25 off their first order!

The first portal the Zuppler team built gained modest and loyal followers, Srinivasan said. Ben Franklin Technology Partners, funded by the state, was one of the first investors.

“Our first order came from Chiangmai, a Thai restaurant here in Conshohocken. They are still our customers. And then a restaurant owner in Chicago liked our order online and asked if we could put their menu on our site. order volume tripled overnight, just from your restaurant. “

The couple had a revelation: while tourists can search for restaurants online, most restaurant diners already had places they liked and mostly didn’t experience. “They don’t depend on discounts. If they like Thai and have eaten well in Changmai, they will ask online if you find it familiar and comfortable. I want to serve those customers, give them a good online experience using the brand of our customers.

So Srinivasan and Barrett removed their original portal and turned Zuppler into a service that, as Srinivasan says, provides the technology that feeds menus and online websites for restaurants they already know and trust. We built that from scratch. “

The model was analogous to Montgomery County clothing retailer Michael Rubin’s pioneering clothing retailer Michael Rubin, GSI Commerce, which helped chains compete with Amazon by connecting their own efficient technology to their family websites, Srinivasan agreed.

“We started serving restaurants with good food and bad marketing. To people who know what they want and don’t need to pay a 30% commission to DoorDash or UberEats, ”he added.

Even with LocalDelivery.org, Srinivasan said Zuppler doesn’t expect well-capitalized industry giants to be out of business … “DoorDash, after all, is not a technology or marketing company. It’s a food delivery company. They do a good job delivering food, ”he said. But with LocalDelivery.org, restaurants don’t end up sharing delivery data with giants like DoorDash that are developing their own food services and can become competitors to restaurants.

Zuppler set up its own delivery service in the Conshohocken area to get to know the business better, in 2015, with 15 drivers, including Srinivasan. He gave Zuppler information on building a better ordering platform for independent restaurants.

The founders also set up “loyalty programs,” promotions aimed at slow days, or new menu items. They have launched the Little Blue Menu online menu for the Chick-fil-A chain, which includes a feature for quick customer feedback.

Like many independent restaurants, that chain is “obsessed with customer feedback,” Srinivasan said. “If they only get a 4.0 out of 5.0, the manager is on the phone to find out why. That’s a high level of attention. It’s the kind of lasting customer we want.”

The couple is confident that there is room for their restaurant-focused online delivery brand. According to Barrett, industry data shows that nearly half of American restaurants still lack a website and there are still regions where online ordering is unsuccessful.

“I worked for AT&T. I know 90% of the population spent 70 years having a phone,” he said. With food there are many opportunities. Wherever we go, you can easily order food from your favorite places and pick it up while you play at a casino or when you arrive at the zoo’s primate house.



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