The Skinny on Delivery-Only Restaurant Concepts
A lot of restaurant trends have popped up in the past 18 months of pandemic life – curbside pickup, expanded app delivery services, contactless ordering, and more. It’s certainly been an interesting time. One such trend we wanted to dive into further? Delivery-only restaurants. Let’s talk!
In 2021, it’s projected that the digital food delivery industry will see revenues of over $306 million, with growth of 16 percent in 2022. According to an Associated Press article, “delivery now makes up 11 percent of restaurant sales, up 86 percent since the pandemic began.” The general idea of a delivery-only restaurant format is that it allows a restaurant to prepare food for the express purpose of delivery. A novel idea, right? Established chains can develop delivery-only restaurants, or food entrepreneurs can dip a toe into the market without investing too much cash.
A sort of “stripped-down” version of a brick-and-mortar restaurant, the delivery-only concept only needs a building and a few staff members, plus a kitchen area—no customers planning on a sit-down meal, here. Some owners operating a delivery-only restaurant will even rent out space to multiple restaurants at once, increasing their revenue flow. If a business is seeing less in-house customers, they may also turn to a delivery-only concept to expand their customer base.
Virtual Dining Concepts is a company established by restaurant owners that, according to its website, “offers traditional restaurant owners a low risk, all in one solution to launch a profitable delivery-only restaurant concept in their existing kitchen operations, with zero upfront fees.” They will work with regional chains, independent restaurants, hotels, and bars—anyone with a commercial kitchen that’s in an area with readily available food delivery services. Virtual Dining Concepts offers menus in nearly every type of food, plus packaging and marketing. The only thing restaurant owners have to do is cook. There’s even online ordering included with each “concept.”
There’s been pushback on this trend, to be sure. Some consumers believe they’re ordering food from a new, niche establishment only to learn it’s actually a big chain behind the food. The moral of that story? If you’re operating a chain, it pays to be transparent about your virtual brands.
For decades, ARF Financial has been a leading lender for restaurant owners nationwide. Our team of seasoned financial consultants has helped thousands of small businesses secure over $810 million in funding. We take the time to understand your business goals from the inside out, working hand-in-hand with you to build a loan product that works best for your needs. Our clients get funds quickly, with fixed payments that won’t increase as revenue grows. Interested in learning more? Stop by today!