How Deliveroo has changed the hospitality industry

Share this article

Operating in over 80 cities across the world, Deliveroo has had a huge impact on the hospitality industry. Conceptualised by former investment banker Will Shu, who was dissatisfied with the quality of takeaway services surrounding his London office, the company is now reported to be worth over $1 billion, and is continuously growing. Here, we take a look at how Deliveroo (and other similar apps) have changed the hospitality industry.

Increasing numbers of people ordering restaurant food

By offering an easy connection between customers and restaurants while also providing a delivery service, Deliveroo has given customers the option of obtaining restaurant food as a take-away. Before Deliveroo’s emergence into the market, a delivery service was only offered by a very small number of specific businesses, focusing on this area. By having the option to get restaurant quality food delivered to their houses, customers are opting to substitute their home cooked weekday meals for food brought by Deliveroo.

This has obviously had a serious negative impact on traditional takeaway and/or delivery services, who have seen their sales fall. These industries are having to quickly react in order to prevent themselves from going out of business, having to focus on both price and quality in order to compete in this changing market.

Restaurants are emptier

However, Deliveroo hasn’t just presented restaurants with benefits. Because increasing numbers of people are choosing to have their favourite restaurant food in the comfort of their own homes, restaurants are becoming emptier, hosting fewer people on-site. Because restaurants rely on increasing their average transaction value by encouraging customers to order desserts, or that extra glass of wine with their food, they are losing out on sales. Equally, by having fewer people in the restaurant produces a negative multiplier effect for the customers who do visit in person; no one wants to eat in an empty restaurant, and a place with few customers is not inviting to potential customers walking down the street looking for a place to eat.

Change in restaurant staff

With more people ordering food, but few customers in the front of house, restaurants are having to re-assess their current staffing structures, often in favour of more chefs and fewer servers. Changing the structure of places in this industry is not easy however, due to their fixed capital – restaurants have a fixed kitchen area, and buying new hobs and burners to increase kitchen output is extremely expensive. Equally, since Deliveroo is relatively dynamic, and the industry cannot be sure as to the long-term effects of apps such as these, many businesses are unsure if the investment in expensive structural and capital change will be worth it.

Latest insights

5 steps to becoming a B Corp

Ever wondered if B Corp is right for your business? …. Well, we think it’s right for every business, but it doesn’t come easy, so we thought we’d put together a brief overview on how we got there in approximately 12 months.

One Tribe: Empowering businesses to take climate action

WeWhoDo are passionate about taking climate action and enjoy talking to those engaged in taking climate action around the world. One such person and team is Ric Porteus, the CEO of One Tribe, who joined us to discuss tree protection, the state of the Amazon rainforest and how they will help businesses to take climate action.

Aceleron: Revolutionizing access to low-cost energy storage

WeWhoDo sat down with Elisa Alexieva, Brand Marketing Manager at Aceleron to discuss UK engineering that is powering the world! The company’s circular economy approach is designing waste out of the battery manufacturing process by manufacturing the first circular economy lithium-ion batteries that can be serviced, maintained and upgraded.

Worthmore: why we need a phonespiracy

WeWhoDo sat down with Tegan Spinner, Founder of Worthmore, to discuss the Phonespiracy and how we can give our old phones a new life responsibly while doing our bit for the planet!

Pip & Nut: Completely Nutty with a big helping of sustainability

WeWhoDo sat down with Jacq Ellis-Jones, Marketing Director and Curious Squirrel at Pip & Nut to discuss how they disrupted their category – not by adding complexity – but by creating a deliciously simple recipe that is good for the planet and people!

We spoke about their decision to move towards glass over plastic, their team of squirrels and what’s in store for them in the future.

MUST HAD: redefine and refashion

WeWhoDo sat down with Eugenio Riganty, co-founder of MUST HAD, to discuss how we can reduce fashion waste without compromising on style!