This letter was recently sent to the editor of Nation's Restaurant News, but you can read it here: 

A recent online issue of Nation's Restaurant News included a feature - 10 Ways to Build Business Inside Your Restaurant's Four Walls.  The article was good, with information and advice that all restaurateurs can use.  Might we suggest a follow-up article - 10 Ways to Build Business Outside Your Restaurant's Four Walls.

At the top of the list should be Online Ordering.

Allowing customers to order takeout or delivery from the convenience of the internet, including mobile phones and tablets, is a major innovation for the restaurant industry.  Studies indicate that customers like to place orders online due to the degree of control and convenience it provides.  Restaurants love it because they receive larger average tickets, the convenience encourages more frequent use, and they have the ability to sell more meals without overburdening the wait staff.  Of course, these are just a few of the benefits.

According to a study by the Cornell University School of Hospitality, 43% of survey respondents ordered food online in 2010.  Take that same group, and narrow it down to respondents between 18 and 35 years old, and it goes up to 60%!  Both these figures are at least a year old and we know they are higher now.  At NetWaiter, we venture to say that within the decade, and probably much sooner, restaurant customers will expect online ordering.  Within some demographics, this is probably already true.  Restaurants that don't have online ordering will lose out on valuable business from valuable customers.

Recent articles in respected business publications reveal that restaurants are seriously questioning the business sense of portal sites that offer online ordering.  An article in Bloomberg BusinessWeek relates how Pedro Munoz, owner of Luz, a Latin American restaurant in Brooklyn, NY, has decided to drop his portal service with Seamless.

The good news is that Munoz has been sending out information with his takeout and delivery orders, directing customers to use his custom online ordering site – powered by NetWaiter.

In the articles, Munoz cites the factors that make portals an untenable situation for his restaurant, and others:

High fees.  Munoz paid Seamless a 14% commission on all orders, plus additional charges for advertising and credit-card transactions.  Considering that some restaurants don't realize a high profit margin on some dishes, this doesn’t leave much profit.

Turnaround time for payment.  Munoz and other restaurant owners had to wait up to 30 days for payments that were processed through Seamless to reach his account.  He says that Seamless was holding as much as $20,000 at some points.

Similar complaints have been made by other restaurants against other online portals.  “It’s awesome if you’re a customer.  It’s great,” Munoz told Bloomberg. “But in all aspects, it’s killing the restaurants.  It’s a model that cannot be sustained.”