My small takeaway is live in a week. Please help with some advice

[hnro14]

Hello,
I ll start apologizing about any grammar mistakes I might make.

This coming weekend I’ll start taking orders for my small takeaway - grill focused(ribs,steaks etc)I do have a question for someone who was in my shoes and worked with Just eat, Uber. Etc…
I’ll state some numbers and if you could help me with some advice that would be amazing.
Monthly rent £350
Gas/electricity £350
Just Eat charges me 27,5% per order
The cost of food for a menu is between £7 and £13
Let’s say for the £7 menu the cost of food is £2 but JE takes the 27.5% which takes me to 7-27.5% = £5-£2= £3 profit on the product before paying for the utilities and rent. Is that ok?
My concern is if I’m charging enough or if I’m missing something.
It’s worth mentioning I have near zero footfall hence the low price of rent and also the reason I am stuck with a delivery option.

If there’s any questions let me know.
Any advices are more than welcome.

Thank you.

 

[fisicx]

You have missed insurance, wages, marketing, internet connection, maintenance and incidentals. Unless you are selling thousands of steaks each month you are probably going to run at a loss.

 

[MOIC]

Is it fitted out, or do you need to include more appliances, packaging etc?

Need to add VAT & a percentage for food wastage.

You should try to work on 10 x your ingredient cost if you want to survive.

Good luck.

 

[Mark T Jones]

I would strongly recommend that you find a cashflow forecast template and run your figures through that

You are working on some fine margins, a few little discrepancies can be the difference between failure and success

 

[hnro14]

You have missed insurance, wages, marketing, internet connection, maintenance and incidentals. Unless you are selling thousands of steaks each month you are probably going to run at a loss.

Free internet. It’s a small sized takeaway so me and my wife should suffice for staff. Insurance is already paid. Would that change the situation slightly?

Is it fitted out, or do you need to include more appliances, packaging etc?

Need to add VAT & a percentage for food wastage.

You should try to work on 10 x your ingredient cost if you want to survive.

Good luck.

fitted out and ready to go. Packaging is already included in the production cost of £2 I mentioned earlier. I feel like I couldn’t get the price of prodution much lower without affecting the quality. Also let’s say £15 for a chicken breast with chips and dips doesn’t sound like anyone would pay. So that means I’m doing something wrong
Just have to find out what.

Thanks everyone for your input. I’ll see if I can find a different supplier and get cheaper ingredients perhaps.

I was hoping that once people get to know my business( after social media + marketing) they would just drop by to collect instead of using Just Eat and that would bring my margins slightly up.

 

[fisicx]

I was hoping that once people get to know my business( after social media + marketing) they would just drop by to collect instead of using Just Eat and that would bring my margins slightly up.

Do you have parking outside? Do you have a website? Can I order and pay online for pickup?

As others have said, your margins are far to small. A takeaway we use spends about £500/month on marketing. A lot of that is flyers but they also do deals and post adverts on social media and Google. They have parking where people drive up and the owner comes out with their order.

As @Mark T Jones suggests, you need to do a cash flow analysis.

 

[hnro14]

Do you have parking outside? Do you have a website? Can I order and pay online for pickup?

As others have said, your margins are far to small. A takeaway we use spends about £500/month on marketing. A lot of that is flyers but they also do deals and post adverts on social media and Google. They have parking where people drive up and the owner comes out with their order.

As @Mark T Jones suggests, you need to do a cash flow analysis.

I do have an outside parking. No website besides the Just Eat page.

I will try to do one this evening. Appreciate your answer.

 

[pentel]

For your £7 menu.

£7 inc VAT

VAT =£1.17

Excluding VAT sale price £5.83

27.5 % for Just eat= £1.60

Excluding VAT & JE = £4.23

less food cost £2 = £2.23.

This has to cover everything else!!!! not enough unless you have huge sales quantities

Bear in mind that the average costa turns over around £500 a day

 

[fisicx]

It needs to be a website with full menu, ingredients allergy info, ordering and payment systems. Not something you can knock up in an evening.

You also need a Google business profile where customers can leave reviews.

Then think about building an email list to entice customers back.

And justeat won’t bring in the punters unless they know you exist. Which means spending a large wodge on marketing before you open and then for many months afterwards.

 

[hnro14]

For your £7 menu.

£7 inc VAT

VAT =£1.17

Excluding VAT sale price £5.83

27.5 % for Just eat= £1.60

Excluding VAT & JE = £4.23

less food cost £2 = £2.23.

This has to cover everything else!!!! not enough unless you have huge sales quantities

Bear in mind that the average costa turns over around £500 a day

Maybe I’m undercharging but not by a lot. I’ll probably need to redo my cost per product and find a better supplier. I should also find a way to sell without relying so much on JE.
I know it depends on a lot of variables and I will do a cash flow asesment but what would you reckon in general the menu price should be compared to the cost of product? Someone mentioned 10 times but that wouldn’t work for a £2 product.

 

[hnro14]

It needs to be a website with full menu, ingredients allergy info, ordering and payment systems. Not something you can knock up in an evening.

You also need a Google business profile where customers can leave reviews.

Then think about building an email list to entice customers back.

And justeat won’t bring in the punters unless they know you exist. Which means spending a large wodge on marketing before you open and then for many months afterwards.

Will set up a google profile and will look up on building a website in order to bypass JE as much. These are all valid points. Doing a cashflow would probably be the best for now and I’ll take it from there.
Not the answers I was hoping for but the answers i needed ?

 

[Mark T Jones]

Maybe I’m undercharging but not by a lot. I’ll probably need to redo my cost per product and find a better supplier. I should also find a way to sell without relying so much on JE.
I know it depends on a lot of variables and I will do a cash flow asesment but what would you reckon in general the menu price should be compared to the cost of product? Someone mentioned 10 times but that wouldn’t work for a £2 product.

For eat in, a normal GP would be 75%

In the old days take away was a bit of a licence to print money, but the likes of Just Eat have crucified that - there are far better returns now in simple sit-downs. (TBH I'm not up to speed with margins on 3rd party take away)

But, whilst averages and norms can be interesting, you need to run your figures to see what will work for your business - it's a tad concerning that you've reached this stage without doing so.

 

[fisicx]

Will set up a google profile and will look up on building a website in order to bypass JE as much.

You will still need JustEat as people use it all the time.

The google profile and website go hand in hand. Building a complex online ordering site is not something you want to try unless you have some experience at his sort of thing. Getting expert help is going to be the best option. Budget a couple of grand for this and add in a few hundred each month for hosting and maintenance. And the payment portal could add another hundred each month (plus fees). You can do things on the cheap but people expect a lot more from a takeaway these days.

All of this means your tiny profit could be eaten up just running the business.

 

[Mark T Jones]

I think @fisicx is pitching in in the middle somewhat - though I would certainly pay attention to him on the subject of online presence.

The absolute basic, fundamental marketing questions you should have been digging into, before you spent a single penny on setting up the business are:

- Who is my target customer?
- How do they behave/buy?
- Why will they use me rather than someone else?

You can add 100 more questions to that list, but until you are absolutely clear on those 3 your marketing budget will be just pissing in the wind.

 

[japancool]

Will set up a google profile and will look up on building a website in order to bypass JE as much. These are all valid points. Doing a cashflow would probably be the best for now and I’ll take it from there.
Not the answers I was hoping for but the answers i needed ?

Make sure that when people order from you via Just-Eat, you include a flyer or something that points them towards your own website. Offer an incentive for people to order directly from you rather than through JE (e.g. deals that are unavailable on JE).

 

[MBE2017]

OP, you seem to have rushed into this venture with no planning at all, which means your chances of success are considerably reduced as a result. You should have considered all these questions before taking on this venture.

Best of luck, I think you are going to need plenty.

 

[fisicx]

Make sure that when people order from you via Just-Eat, you include a flyer or something that points them towards your own website. Offer an incentive for people to order directly from you rather than through JE (e.g. deals that are unavailable on JE).

Indeed. But for that to happen you need your own online ordering system. And even then people will still use justeat because the app is on their phone.

 

[Newchodge]

Indeed. But for that to happen you need your own online ordering system. And even then people will still use justeat because the app is on their phone.

Most of our takeaway purchases are still from menus throug the door. I look onlinw if I have heard f a new provider that I don't have a menu for, but, as soon as I order I get a menu with the delivery.

OP don't forget old fashioned printed menus to include with every order and, possibly put through all local doors.

 

[Mark T Jones]

Make sure that when people order from you via Just-Eat, you include a flyer or something that points them towards your own website. Offer an incentive for people to order directly from you rather than through JE (e.g. deals that are unavailable on JE).

You'd need to check on the legal/contractual aspect.

I can't speak for take aways, but there are clear rules on how hotels can / can't differentiate their offers between platforms.

 

[Ozzy]

Most of our takeaway purchases are still from menus throug the door.

All the comments above are valid, I'll just add a +1 to this... and it does depend if I were your target market.
My kids order online for the likes of Domino's but when the wife and I have a take away/delivery we get the menu the kitchen drawer, spend 15 minutes reading through it then telephone the take away and order the exact same thing we always have! ?. (the point here being we order by phone from a printed menu that was posted through our door -I've never used JE)

Personally I think you may need to review your prices upwards, as your margins do look very tight. You need to be building the business to make enough money to make you and your wife redundant with it run by someone else with you still taking a drawing - ideally. You also need to be able to build a nest egg for rainy days.

 

[japancool]

You'd need to check on the legal/contractual aspect.

I can't speak for take aways, but there are clear rules on how hotels can / can't differentiate their offers between platforms.

I imagine JE also have some rules about it, but I know some takeaways in our area have different offerings on JE than on their own sites (Pizza Hut being one very notable example).

 

[Newchodge]

when the wife and I have a take away/delivery we get the menu the kitchen drawer, spend 15 minutes reading through it then telephone the take away and order the exact same thing we always have!

We tend to go through the different menus before deciding on the usual provider and then go through the menu before agreeing on the usual order. ?
??

 

[IanSuth]

Yeah we have a discussion about all the other weird and wonderful; things we could buy but then often end up with the same old same old from the reasonably ok Chinese within walking distance (who only take cash) or the chippy/burger/turkish place a bit further away who do JE but give you bigger portions/free extras if you collect because we cant agree between 4 of us what else we would want to try.

We tend to try new places due to a deal on a paper menu through door, but most only last a year or so and then it is "under new management" and we are unsure of the quality

 

[fisicx]

All of which come back to the post by @Mark T Jones: know your customer.

Once you know who you are selling to and how they buy you can then tailor your marketing plan accordingly. You may discover your target is middled aged foodies who don’t use justeat which means you need a totally different way of getting their orders.

Incidentally, if you are going to take internet/telephone orders you both need to be working all the time. Which means no time off ever. Which means you will soon burn out.

 

[hnro14]

Very useful piece of information from all of you.I can’t respond to everyone but I read and re-read everything that was posted. I do appreciate all the advices and tips and I’ll try to implement some of them.
The flyers are already in the making and social media aswell. Both of them will try and send the customers into ordering by phone - which was a great idea.
I will look into putting the prices a little bit up as what we’re selling is only made from fresh meat sourced locally and also we’re using a grill to cook it which means less oil and less that classic fast food style. There’s only one more restaurant that does proper barbecue and they’re a restaurant.

 

[fisicx]

That looks like a great usp. Really push and promote the local/fresh thing. Get some videos make of the food being cooked. Think of the M&S food or Tesco food love stories. Sell the sizzle not the sausage. Use sites like nextdoor and local forums and blogs to build up anticipation.

If done well you should have people queuing out the door on opening night.

Almost all your success will be because of marketing and only a small bit because of the food.

Might even be worth delaying the opening if you don’t have all the ducks lined up.

Post your flyer here to get a critique. Last person that did ended up with a much better flyer.

 

[Mark T Jones]

You have a USP going on, which is definitely a good thing.

To a significant extent the USP will define who your target customer is - do some research into that to establish the habits, preferences and behaviour of those consumers

 

[hnro14]

That looks like a great usp. Really push and promote the local/fresh thing. Get some videos make of the food being cooked. Think of the M&S food or Tesco food love stories. Sell the sizzle not the sausage. Use sites like nextdoor and local forums and blogs to build up anticipation.

If done well you should have people queuing out the door on opening night.

Almost all your success will be because of marketing and only a small bit because of the food.

Might even be worth delaying the opening if you don’t have all the ducks lined up.

Post your flyer here to get a critique. Last person that did ended up with a much better flyer.

Hey there. In no way I'm a graphics designer so if you're ready for a facepalm ? I attached a draft of the flyer that also acts as a menu. If you'd like let me know what bases I need to cover in order to have a decent flyer.
Hope this site is allowed here.
Also here in case 1st one doesn't work:

Your feedback is highly appreciated.

 

[japancool]

Change that font for the text in the top-right and bottom. It looks cheap and rather downmarket.

Personally, I find the "Hey! Did you know..." slightly condescending.

The prices seem a little high, £10 for one chicken breast? That appeals to a certain demographic, so you're going to need to make sure you get your marketing properly targeted.

I'd also want to know how large the rib-eye steak is, how many ounces? And for £10, those had better be quite large sausages, if you only get one. Our local grillhouse does a grilled chorizo for £7.99, and it's about 20cm or about 8" long, at a rough guess. I think you'd benefit from a little bit of added description to your menu, for first time buyers. You have to entice people who've never ordered from you before to try you out for the first time.

There's no address. I hope that's on the reverse side, as people will need to know where to go to collect from you!

I suggest you put a calorie count on there as well.

And... where's the alcohol on your drinks section? If you're selling barbecue, alcohol seems to be the perfect accompaniment.

I have to say though - I hate chicken breast. It's the driest, most unappetising part of a chicken possible (not counting chicken feet, no thank you). I have yet to come across a well done chicken breast anywhere in the world. Not saying your chicken breast will be bad, this is just my personal opinion. I'd have liked to see the option of chicken thighs or whole legs.

 

[hnro14]

Change that font for the text in the top-right and bottom. It looks cheap and rather downmarket.

Personally, I find the "Hey! Did you know..." slightly condescending.

The prices seem a little high, £10 for one chicken breast? That appeals to a certain demographic, so you're going to need to make sure you get your marketing properly targeted.

I'd also want to know how large the rib-eye steak is, how many ounces? And for £10, those had better be quite large sausages, if you only get one. Our local grillhouse does a grilled chorizo for £7.99, and it's about 20cm or about 8" long, at a rough guess. I think you'd benefit from a little bit of added description to your menu, for first time buyers. You have to entice people who've never ordered from you before to try you out for the first time.

There's no address. I hope that's on the reverse side, as people will need to know where to go to collect from you!

I suggest you put a calorie count on there as well.

And... where's the alcohol on your drinks section? If you're selling barbecue, alcohol seems to be the perfect accompaniment.

I have to say though - I hate chicken breast. It's the driest, most unappetising part of a chicken possible (not counting chicken feet, no thank you). I have yet to come across a well done chicken breast anywhere in the world. Not saying your chicken breast will be bad, this is just my personal opinion. I'd have liked to see the option of chicken thighs or whole legs.

Change that font for the text in the top-right and bottom. It looks cheap and rather downmarket.

Personally, I find the "Hey! Did you know..." slightly condescending.

The prices seem a little high, £10 for one chicken breast? That appeals to a certain demographic, so you're going to need to make sure you get your marketing properly targeted.

I'd also want to know how large the rib-eye steak is, how many ounces? And for £10, those had better be quite large sausages, if you only get one. Our local grillhouse does a grilled chorizo for £7.99, and it's about 20cm or about 8" long, at a rough guess. I think you'd benefit from a little bit of added description to your menu, for first time buyers. You have to entice people who've never ordered from you before to try you out for the first time.

There's no address. I hope that's on the reverse side, as people will need to know where to go to collect from you!

I suggest you put a calorie count on there as well.

And... where's the alcohol on your drinks section? If you're selling barbecue, alcohol seems to be the perfect accompaniment.

I have to say though - I hate chicken breast. It's the driest, most unappetising part of a chicken possible (not counting chicken feet, no thank you). I have yet to come across a well done chicken breast anywhere in the world. Not saying your chicken breast will be bad, this is just my personal opinion. I'd have liked to see the option of chicken thighs or whole legs.

As I said - it's only a draft. Prices are not definitive, address is to be added as well. I feel I still need to tinker in regards to the font and placing as it gives the impression of crammed up.

At the moment in regards of delivery I only use JE which takes a big chunk of my income so prices have to be a little bit high - I know that in real world this is not ideal but I'll give it a shot and see how customers respond.

The steak is 10 ounces roughly. And we serve around 250 g of sausages.
£10 for a chicken breast with dip and chips aswell. When collecting it's £8.5 and they also get a drink of their choice.


I have not looked into alcohol as I am not well versed into this and I wouldn't even know where to start with the licences and everything. I feel like at the moment I have enough on my platter for now. Again, this is just a small takeaway that I'm setting up with a minimum investment so far and minimum knowledge so I'm pretty realistic and don't have great expectation.

Thank you for your feedback, I appreciate it

 

[fisicx]

Have you looked at the flyers that come through your door? Pictures of the food, lots of colour, codes for discounts etc.

You need a lot more of everything on the flyer. At the very least show me what I’m getting.

But…

Why would I even need to get a sausage delivered? I can fire up the barby and cook one myself quicker than you can deliver.

You need to do a lot more marketing before you open. Finding out who your target customer is and their price point will be a good start. Then find out how they order food.

You need to do a lot of pre-opening work as well. Flyers with the 'coming soon' message. You need that website up and running and start work on your social media. For example, putting up images on instagram, telling food stories on FB, meal ideas on NextDoor and so on. Build up anticipation. As I said in an earlier post, you might not even need JustEat.

Pay someone to design you a flyer. It's not your area of expertise so don't even try.

 

[Deleted member 315707]

Do you have parking outside? Do you have a website? Can I order and pay online for pickup?

As others have said, your margins are far to small. A takeaway we use spends about £500/month on marketing. A lot of that is flyers but they also do deals and post adverts on social media and Google. They have parking where people drive up and the owner comes out with their order.

As @Mark T Jones suggests, you need to do a cash flow analysis.

I’m not disputing the comments about cash flow or marketing but £500/month mostly on flyers that the majority of people chuck in the bin is just crazy in 2022. May as well hire a sign writing plane and spank it in the sky.

 

[Mark T Jones]

In common with most people who don't understand marketing you are diving into the 'fun' visual bit whilst steadfastly avoiding the graft that will actually make a difference - ie research.

Your dull flyer makes only a fleeting reference to 'local' - every bit of it should shout provenance to me.

Then you have the perennial delivery/ presentation problem.

If I order a quality rib-eye, I want it to look and feel like it came off the grill and rested 3 minutes ago, not warm and sweaty in a box (that's why wet take aways are popular) - the quality aspect must last through the entire process

 

[Newchodge]

I thought the prices on the high side until I saw the 15% discount and free drink for collection, by which time I already had a mental feel for high price. I don't know if Just eat allow it but I would price for collection, which is what you offer. Phrasing it the way you have implies that you offer delivery, and I don't think you do.

 

[Nico Albrecht]

If I would see your menu on paper or online I'd wouldn't order.

There is too much info missing and items feel like store bought stuff and boring specially the sauces. Add at least some sort of hot sauce as well.

You need to do more explaining and possible some more vegetarian options and create a killer USP. Give the dishes good or funny names.

Also add 2 - 3 types of starch such as baked potatoes, sweet potatoes fries, wedges maybe to the menu.

It just doesn't feel like BBQ place or what I would think of a BBQ place more like the usual take away place.

What grill tech do you use e.g Gas, Charcoal, flat grill and so on. This needs to be better explained.

If I'd know what BBQ you use such the likes of a smoker etc... I would be more tempted to order as I can't do that at home.

Sauces read cheap and store bought and dont go well with your home made desserts.

Start developing a fresh killer " House Sauce " and scream all over the place the stuff is fresh if it really is.

Actually make all your sauces from scratch as a USP and also add a skinny option for people on diets and a low carb option etc.... This can all be done by using your existing menu just marketed better such as protein bomb etc...

How about making some sausages from scratch beef, pork and pullet types and let this be your USP in combination with buying fresh sausages to take home. Might as well do a fresh burger paddy from different proteins. A fresh made veggie paddy possible as vegetarian option.

Ribs are missing on the menu and also I would never order a steak from a takeaway it will never arrive in a condition I would be happy with.


I would put more local seasonal grilled veggies on your menu that go with the proteins.

Prices they don't make sense you are right in the middle not cheap but not expensive either.

For the rest I'm not sure what your demographics are and what disposable income is available in your area.

 

[fisicx]

I’m not disputing the comments about cash flow or marketing but £500/month mostly on flyers that the majority of people chuck in the bin is just crazy in 2022.

It’s not just flyers. That’s his total marketing spend. And a lot of people keep flyers for takeaways. Especially if they have coupons. He creates new flyers each months with different deals and offers that brings in a load of business. Add in social media ads, Google business profile, posters in pubs and there is great variety of marketing tools in use that adds to the cost. He easily covers this total cost in a weekend.

 

[Deleted member 315707]

I said mostly as that’s what you said. For some, flyers may work, but for most they get thrown in the bin and certainly after the 10th menu from the same curry house, it’s 100% waste.

Any wide ranging survey or report concerning whether leaflets still work in 2022 I’ve seen are either written by a printer or commissioned by the DMA. Do you have anything other than anecdotal which says otherwise?

 

[fisicx]

It goes back to the market research as @Mark T Jones suggested. This will tell you if the target customer is more or less likely to phone in their order.

 

[ecommerce84]

I like the overall concept, and the menu main options seem varied enough to get you going. I do agree that a couple of extra carb options would be beneficial.

Price wise, I think you’re about right. We were trading at a food festival on Saturday and I was going to treat myself to some food from one of my favourite vendors - they charge £12 for a larger foil tray with seasoned fries, pulled pork and coleslaw. The only reason I didn’t buy it was because the queue was epic, and we were too busy for me to be away from our stall for that long.

They also have a premises and they are always busy, and they only really rely on social media for advertising.

If I were you I’d do the following:
- delay your opening date
- perfect how your dishes are going to look - if you’re charging slightly more make them look as epic as you can
- take your advertising budget and get some professional photos of your products done that really show off your food.
- start building a buzz that your business is coming soon on social media - post on Nextdoor and importantly local Facebook groups. Post your new photos of your food and get people salivating.
- Pay for some professionally designed flyers, don’t try and do them yourself. Would you rather pay £1000 for flyers that generate £20,000 of revenue or have £5,000 of revenue from home made flyers.
- the easiest way to build up new followers on Facebook is with a competition - post your best pictures of your best products and say you’ll be picking 5 people at random who like your post, tag 2 friends and share your post. Throw some money behind it by sponsoring the post to people in your local area and get this post in to your local Facebook groups.
- launch with a bang - get local food bloggers on board, give them free food in exchange for posts and reviews, maybe offer an opening night deal with free drinks, but make sure you can cope if you’re busy.

Food businesses always do well on social media if you have decent photos, I’d prioritise social media over printed leaflets if you have to pick one.

I wish you the best of luck, I’d definitely give you a go if you end up being local to me!

 

[MBE2017]

FWIW I would print the two prices side by side, delivered and collected, or have the collected price plus a flat delivery charge unless £x is spent. Most people will struggle to work out the discount price, where adding £5 delivery is easy at the end.