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Breaking point - takeaway?

Discussion in 'General Business Forum' started by Abbyboo92, Feb 24, 2020.

  1. Abbyboo92

    Abbyboo92 UKBF Regular Free Member

    113 7
    Hi everyone
    As some of you know around 6 weeks ago I opened a takeaway from home selling mostly desserts
    I’m now at breaking point
    I know most businesses make a loss in the first 3 years but I need to be able to eat and take care of my child
    I’m brining in around £900 a week but most of that goes on the drivers wages/stock and I’m taking home about £20 a week
    14% goes to JustEat, about a 3rd of orders are taken directly
    My pricing structure for the food items, most of the items I am making at least 3x the amount. For example, my most expensive to make waffle costs me £1.20, I sell it for £6.

    drivers are paid £10 an hour + £1 per delivery. I have one driver all week, 2 on Friday and Saturday. Any advice before I shut it down?
     
    Posted: Feb 24, 2020 By: Abbyboo92 Member since: Dec 31, 2019
    #1
  2. Mitch3473

    Mitch3473 UKBF Regular Free Member

    1,086 260
    First of all, well done..I trust this business is coming from fare paying punters and not just family and friends.....
    Secondly, it's not the norm for businesses to take 3 years to get to profit and thirdly, and I'm sure some far better qualified food outlet owners on here may or may not correct me but.....how do the food delivery firms, Deliveroo, Uber eats etc stack up against your drivers wage bill.
    Keep up the good work.
     
    Posted: Feb 24, 2020 By: Mitch3473 Member since: Aug 25, 2011
    #2
  3. AndyF85

    AndyF85 UKBF Newcomer Free Member

    13 0
    Is your driver available at all times? If so what % of the time are they actually driving?
    What is the average distance between your office and the delivery points?
     
    Posted: Feb 24, 2020 By: AndyF85 Member since: Feb 23, 2020
    #3
  4. Abbyboo92

    Abbyboo92 UKBF Regular Free Member

    113 7
    6.5 miles is the delivery radius, one of the drivers does it in 32 mins one does it in 24... they are sitting idol most of the time (they do other stuff like cleaning, making boxes up) in spare time but not worth the £10 an hour wage. The majority of the orders come between 6 and 7pm
     
    Posted: Feb 24, 2020 By: Abbyboo92 Member since: Dec 31, 2019
    #4
  5. Opinion87

    Opinion87 UKBF Regular Free Member

    426 104
    A bunch of us tried to give you advice before you started but you told us all to shut up.
     
    Posted: Feb 24, 2020 By: Opinion87 Member since: Jul 1, 2015
    #5
  6. Abbyboo92

    Abbyboo92 UKBF Regular Free Member

    113 7
    I’m sorry, but I think this is rude and unnecessary. I didn’t tell anybody to shut up, I took your advice into account.
     
    Posted: Feb 24, 2020 By: Abbyboo92 Member since: Dec 31, 2019
    #6
  7. tony84

    tony84 UKBF Big Shot Free Member

    5,710 1,029
    What do you earn from pick ups only?
    Sometimes lower turnover can equal more money in your pocket, so getting rid of the drivers may result in an increased income.

    Failing that, have you looked at alternatives to just east? Deliveroo for example have their own drivers/riders dont they? You could maybe still do take aways but without having to pay drivers.

    You are 6 weeks in to a business. I am not sure I would have set up a business expecting to turn a profit in such a short space of time.

    Have you worked out what the issue is or could be?
    - Are you selling enough to earn an income but expenditure is too high?
    - Are you just not selling enough? If not, are sales increasing or staying fairly level?

    If you need to just increase sales, what can you do?
    - Facebook?
    - Sell to local businesses, pay day treats for example or teams hitting targets?
    - Can you sell to retailers? Profit margins will be hit but if you are selling more, then you may find you are making more in the long run (the opposite to what I said earlier.

    At 6 weeks, you wont really have enough information but you should be able to make a bit of judgement on what the issues could be.
     
    Posted: Feb 24, 2020 By: tony84 Member since: Apr 14, 2008
    #7
  8. Abbyboo92

    Abbyboo92 UKBF Regular Free Member

    113 7
    There’s no Deliveroo, Uber eats in my area. It’s delivwry only as I work from home. I have had 2 people pick up before but I wouldn’t want this as an everyday thing as a bit unsure what to do if they turned up early?! the sales are good, they could be increased but it’s a bad time of year. I’m sure this weekend will be good as payday weekend. But then that means needing more drivers and stock
     
    Last edited: Feb 24, 2020
    Posted: Feb 24, 2020 By: Abbyboo92 Member since: Dec 31, 2019
    #8
  9. tony84

    tony84 UKBF Big Shot Free Member

    5,710 1,029
    Does Ubereats have their own drivers/delivery people?
    If they do, why not sign up with them?

    You cant really be outlaying £20 an hour to 2 drivers who do nothing of any value 90% of the time. That seems to be where the issue lies. If you can cut that cost out, then all of a sudden your profit margin jumps up. It sounds like you need to think of a way to get around that, which either means something like Deliveroo or an alternative who has their own drivers or another option (no idea what that would be, but have a think - maybe you could cook the cakes during the day and then deliver them yourself in the evening).
     
    Posted: Feb 24, 2020 By: tony84 Member since: Apr 14, 2008
    #9
  10. Opinion87

    Opinion87 UKBF Regular Free Member

    426 104
    You chose to ignore anyone that said anything that you didn't agree with.

    If you had taken a step back and been a bit more open to advice it would have probably have become obvious pretty quickly that you needed to re-evaluate a few things.
     
    Posted: Feb 24, 2020 By: Opinion87 Member since: Jul 1, 2015
    #10
  11. AndyF85

    AndyF85 UKBF Newcomer Free Member

    13 0
    I think most people have shown that your delivery issue is the biggest cost, which is taking money away from you and your child.

    You could also give them something extra if they pick up? People may enjoy the experience of the chat with the person who made the cake, make it more personal. If the environment at home allows maybe a small coffee and a sample of a new cake while they wait the few mins? Be creative.

    Keep your head above water, and try small incremental improvements over time. The savings will improve over time to become large shares of profit.

    But that delivery issue seems to be a complete nightmare...

    As also suggested increasing sales in the cheapest and quickest way possible through social media . If your town has a localised facebook page "whats going on in [insert town name here]" type of thing, people tend to givelocal producers a chance, hopefully your skills will convince them for a second visit

    Keep at it
     
    Posted: Feb 24, 2020 By: AndyF85 Member since: Feb 23, 2020
    #11
  12. mattk

    mattk UKBF Newcomer Free Member

    2,022 770
    Firstly, how much do you want to take home per week? Let's say £500. Based on your average order size, how many orders per week do you need to make that much - compared to how many orders you are currently making? Is it realistic for you to scale up, given that you'll need to be making the orders and your drivers deliver them?

    Alternatively, you could look to cut your costs. How evenly are your orders spread out across the week? Have you worked out your profit per day? Could you close for a few days per week in order to reduce your costs?
     
    Posted: Feb 24, 2020 By: mattk Member since: Dec 5, 2005
    #12
  13. Mitch3473

    Mitch3473 UKBF Regular Free Member

    1,086 260
    Or....have more manageable opening hours, condensing your driver hours into shorter but more productive windows.
     
    Posted: Feb 24, 2020 By: Mitch3473 Member since: Aug 25, 2011
    #13
  14. dan19900

    dan19900 UKBF Regular Free Member

    250 44
    Best to just shut it down, it was obvious from your first thread on here that it would be an absolute disaster.
    Thought you'd atleast manage to make a few quid before hitting the VAT threshold though to be fair
     
    Posted: Feb 24, 2020 By: dan19900 Member since: Mar 2, 2018
    #14
  15. UrbanRetail

    UrbanRetail UKBF Regular Free Member

    244 75
    What are your portion sizes like? Especially waffles as waffle makers varying in size a great deal. What model are you using?

    Have you tried putting leaflets/business cards in with the JustEat orders? Try and get them to order direct.

    I'd definitely drop to one driver, are there no just eat drivers in your area?
     
    Posted: Feb 24, 2020 By: UrbanRetail Member since: Mar 3, 2012
    #15
  16. Mark T Jones

    Mark T Jones UKBF Big Shot Free Member

    4,300 1,494
    Ok. I’ll admit - despite what I post on here - when I first started out in business I just turned up and winged it. For me it actually took 18 months for the sh!t to hit the fan. During that time I had what now be called a mentor (to me it was a friendly mate in business). When I moaned about stuff going wrong, his favourite response was ‘welcome to the real world’. And that’s where you are now.


    Hopefully you have now realised there is a whole lot more to running a business than just turning up, making stuff and posting on Facebook.

    Moving forward, as I see it your options are:

    1. Give up and get a job
    2. Give up and get a job whilst creating a plan and projections so you really understand the mechanics of your business
    3. Keep going whilst creating a business plan with projections so that you really understand the mechanics of your business
     
    Posted: Feb 24, 2020 By: Mark T Jones Member since: Nov 4, 2015
    #16
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  17. Mr D

    Mr D UKBF Legend Free Member

    20,737 2,392
    Nothing like adversity to cause us to try new things.

    OK current plan not working so well, junk current plan. Try new plan that may be variation on old plan.

    Reduce number of days. Reduce number of hours per day. Change prices. Change portions.
    Do 'specials' - combining multiple things to get bigger per order totals.

    Don't know how feasible this could be with your setup - but can you do a sinfully decadent / high calorie dessert suitable for 2 people to share? Sometimes see them in restaurants and occasional pub - a bigger dessert that someone really likes and will scoff the lot or 'officially' will share with their partner.
    Higher price, higher profit total per order of it - though would suggest making something like that early in the day.

    Perhaps most of what people suggest won't work for you. Perhaps something will spin off an idea that you can run with.

    No business is worth doing simply to work hard, there should be a time (months or years away maybe) where you get a regular income from your efforts and also making a profit.
    Sometimes it does indeed take years. Sometimes it takes a short time.

    Good luck.
     
    Posted: Feb 24, 2020 By: Mr D Member since: Feb 12, 2017
    #17
  18. Mitch3473

    Mitch3473 UKBF Regular Free Member

    1,086 260
    People will pay good money for the info in this post.

    If you only implement a handful of the suggestions on here you ' should ' do alright
     
    Posted: Feb 24, 2020 By: Mitch3473 Member since: Aug 25, 2011
    #18
  19. UKSBD

    UKSBD Not a real duck Staff Member

    9,826 1,881
    If you are delivering to order and the drivers are only delivering one item at a time it's costing over £6.00 just for the one delivery.

    You need to have a system where you only do deliveries when there are at least a set amount of orders at a time and have a really good knowledge of delivery routes and a bit of strategic planning.

    ie
    rather than a driver taking 30 minutes to deliver an order, he should take 40 minutes to deliver 10 orders
     
    Posted: Feb 24, 2020 By: UKSBD Member since: Dec 30, 2005
    #19
  20. AndyF85

    AndyF85 UKBF Newcomer Free Member

    13 0
    As said above, so many good ideas that you can use or twist to your requirements to be successful.

    Just another idea for people to pick up, could be to give some sort of "upgrade/discount on their next order". Not only are you avoiding transport costs, but you are combining it with marketing to increase sales for the future.

    In my experience, the less variables you have to think about and the greater capacity you have to think about better things rather than delivery drivers etc.
     
    Posted: Feb 24, 2020 By: AndyF85 Member since: Feb 23, 2020
    #20