Online ordering and delivery are two separate functions that can expand a restaurant’s operations. An online ordering system allows restaurant customers to order food through a website. A delivery system allows you to transport online orders to a customer. There are two primary strategies for adding online ordering and delivery to your restaurant operation: building an in-house system or using a third-party platform.
Setting up a restaurant online ordering and delivery system is simple and can be very low cost. Online ordering systems range from free to $79 per month, depending on which products you use. Adding online payment processing will add fees of up to 3.49% plus 50 cents. Prices for food delivery solutions vary greatly, from free to upward of $700 a month. Some delivery services will also charge a commission of 20% to 30% of every order they process.
Online Ordering System Type
Without Online Payment Processing
Free - $9 per month
Works with or without a POS; quick setup; no annual contracts; great in an emergency
Orders are not prepaid; orphaned can lead to food waste
With Online Payment Processing
$29 - $75 per month
All orders can be prepaid, cutting down on losses due to orphaned orders
Higher credit card processing fees for online transactions; integrating with a POS may come at an additional cost
POS Module with Payments & Delivery
$75 - $150 per month
Great for full service restaurants; all sales are in one place; no need for double entry; can track customer information for marketing and promotions
Must manage your own drivers; additional expenses for auto insurance
Third Party Platform with Delivery
Setup fee: $150 - $350;
Order Commissions: 20% -30%
Promotes your restaurant to a new audience, comes with a fleet of drivers
Requires additional integration fees to send orders via your POS; transferring orders manually can lead to errors; no access to customer data; requires administrative time to oversee
Setting up online ordering can seem daunting, but that is because there are so many options. Many options, however, means restaurants can create customized solutions. We’ve listed the options below from lowest to highest cost. In-house solutions are listed first, with third-party platforms below. For more in-depth analysis of software options in each category, see our definitive rankings of the best online ordering software and the best food delivery software.
The best online ordering system for your restaurant is the one that allows you to maintain a profit. Low-cost solutions with lots of functionality tend to require regular managerial attention to operate. On the other hand, a high-functioning system that does not require a lot of your attention will probably be expensive.
Recent updates to Google searches have made it very important for restaurants to decide how to manage online ordering. Increasingly, search results for restaurants feature an “order online” button. If your restaurant does not have an online ordering site to receive this traffic, it may be claimed by a third-party platform that will then process these customers and orders through their platform.
How to Set up Simple Online Ordering
Many restaurants start with a simple online ordering system that allows customers to place an order on their website, then pick up those orders and pay at the restaurant. Then, as a restaurant’s online ordering traffic grows, they can expand their system to integrate with a POS or even add delivery drivers.
Simple online ordering can be used for curbside pickup or allow customers to merely order ahead and pay for their meal at the time of pick up, either in cash or credit/debit card. This sort of ordering prevents lines from forming in quick-service restaurants. A minimal system like this is flexible; it works for small restaurants that operate with or without a Point of Sale (POS) and restaurants that only accept cash payments.
Online Ordering without Online Payments
Restaurants that operate with or without a POS can set up online ordering through GloriaFood. GloriaFood provides a free do-it-yourself online ordering platform while offering additional features, like online payment processing, for a monthly fee. GloriaFood pricing is transparent, and using the system does not require a contract. Both methods are so simple to set up that restaurants can start receiving online orders within hours of completing their profile.
Setting up online ordering with GloriaFood is easy. Interested restaurants simply go to the Gloriafood website and create a profile for your restaurant. The setup dialog box will request your restaurant’s name, address, hours of operation, and website. If you do not currently have a website for your restaurant, you can get one through GloriaFood for $9 per month.
Once your restaurant is registered, you will need to create your online menu. The menu set-up dialog box will walk you through the process. There are areas to describe each dish that you offer, and places to include photos of those dishes. If you serve popular dishes like pizza or burgers but don’t have pictures of your specific dishes, GloriaFood has stock images that you can add in their place.
Once your menu is loaded, you can add the GloriaFood order buttons to your restaurant website and Facebook page. Once you download the GloriaFood Admin App, the online menu works on mobile devices like smartphones and tablets. Orders placed on your digital menu appear in the GloriaFood Admin App, which rings with an alert, so you can begin processing the order.
Using a POS for Online Ordering
Cloud-based POS systems have great options for online ordering. Toast, Lavu, Revel, and Upserve all have robust online ordering functions that place an online menu on your restaurant website and send online orders directly to the order stream in your POS. Pricing for online ordering modules varies from system to system, ranging from $25 to $75 per month. This option is high functioning, requires little administrative work, and price-wise is middle of the road.
Using a native online ordering system through your POS syncs all of your in-house operational information with your online business information. The online menu will update with your in-house menu. If you run out of a dish, blocking that dish in your POS disables ordering for your employees in the restaurant as well as customers ordering online. Your daily sales and tax information will all be in one place, making it easy for you to track your restaurant performance metrics and create forecasts.
Online Ordering with Online Payments
The next step up in online ordering functionality is online ordering with online payments. If your POS offers an online ordering module, accepting online payments can be as simple as clicking a button in your management dashboard. Payment processing fees will typically be higher for credit card payments made online, however, since they are a higher risk transaction. These fees range from 2.9% + 30 cents on the low end to 3.99% + 50 cents on the high end.
The higher payment processing fees can be worth it to ensure that all your online orders arrive pre-paid. Online ordering with online payments is the best way to set up a no-contact, curbside delivery operation.
Online Payments Without a POS
Restaurants that operate without a POS can add online payment options by setting up a Square Online Store. Square’s Online Store is free to set up; it only charges payment processing fees for payments. Square’s standard transaction fee for online payments is 2.9% + 30 cents and allows you to accept credit cards, debit cards, Square gift cards, and Apple Pay.
Alternatively, restaurants that created an online menu via GloriaFood can add GloriaFood’s online payment plug-in for $29 per month. The main advantage of GloriaFood is that the system was designed for food orders, so it is easy to build in customization options. Though not built specifically for restaurants, a Square online store has the advantage of allowing restaurants to accept online orders and online payments with absolutely no setup fees.
After setting up online payments for your online orders, the next big decision for a restaurant is whether to expand into delivery. Delivery solutions are as plentiful as online ordering tools; the trick is choosing a system that works best for your operation.
A Hybrid Solution for Online Ordering & Payments
There is one online ordering tool currently on the market that straddles the line between an in-house solution and a third party solution. ChowNow is technically a third-party platform that is “white-labeled.” It creates an online ordering and payment portal that is branded with your restaurant name and logos and hosted on your restaurant website. It has the look and feel of an in-house solution, with the functionality of a third-party ordering system.
Unlike a more robust third party platform, however, ChowNow does not have a wide customer base. For restaurants that already experience a high volume of in-house business, or those that want to offer a branded in-house solution quickly, ChowNow can be a great fit. ChowNow currently does not extend into delivery operations. For that, restaurants will need to hire a roster of in-house drivers or consider a more robust third-party platform.
ChowNow offers three different pricing tiers that range from $99 to $149 per month. With the set-up fee that ranges from $199 to $399, getting started with this platform can be pricey. Visa, Mastercard, and Discover card transactions are processed at a rate of 2.6% plus $0.10 per transaction; American Express transactions are 3.5% plus $0.15 apiece.
Online Ordering with Delivery
Delivery adds convenience for customers, especially those who work long hours or have small children at home. Adding delivery to your online ordering operation is an excellent fit for restaurants in suburban places of sprawling cities. Consumer demand for restaurant delivery has been growing steadily. Research by Technomic found that in 2019, 21% of consumers shifted to ordering delivery over carryout.
When considering adding delivery to your restaurant operation, the most significant decision you need to make is whether you will hire drivers or work with a third party delivery platform. There are pros and cons to both choices. Adding drivers to your employee roster can be logistically tedious and require expanding your insurance coverage. Third-party platforms on the other hand, retain all the customer data and charge hefty commissions on each order.
Using Your Own Delivery Drivers
Restaurants that plan to hire and manage a fleet of delivery drivers need a system for assigning orders, tracking drivers’ sales, and dispatching drivers.
In a small operation, a manual method of handwritten tickets and addresses may work fine. If, however, you want more control and trackability, there are many options for software tools to help streamline the process.
Restaurants that work with a POS system with a delivery module can manage in-house deliveries with the click of a button. Upserve, Revel, and Toast, in particular, have excellent built-in delivery modules. More POS systems are expanding into this area every day, however, so you should check with your POS provider to see what options are available.
If your operation currently does not use a POS, freestanding delivery management tools like QuestTag, Mobi2Go, and ZippyKind can help organize your drivers. Monthly fees for these tools range from $29 to $149 and may depend on how many deliveries you process. Setup fees range from $39 to $99. Some tools, like Mobi2Go, also charge a 3% commission on all deliveries processed through their platform.
Most of them, however, operate on a month-to-month basis. If you try one and it is not a good fit, you can move on to a new strategy with no financial consequences or broken contracts. For more information, see our definitive ranking of food delivery software.
Hiring & Training
Hiring delivery drivers will be an essential part of any in-house delivery solution. You may be able to shift some of your employees from functions like serving or cashiering to driving. You may also have luck finding drivers in your area on social media boards where drivers share advice.
Wherever you find your drivers, you will want to be sure that they have a valid drivers’ license, a clean driving record, and at least some familiarity with your location. Once you have hired your team, you will likely need to spend some time training them on your ordering and delivery systems as well as safe food handling techniques.
Insurance & Liability
If you are working with an in-house team of delivery drivers, you will want to make sure that your liability is covered. If you are using company-owned vehicles, there will be the additional expense of purchasing and maintaining those vehicles. You will also need to add automotive coverage to your business insurance. If, however, you allow your delivery drivers to use personal vehicles to deliver your food, you will need to add “hired, non-owned” insurance to your policy.
Depending on your insurance provider, your location, and the number of drivers you are covering, this should add $50 to $150 to your monthly premium. Most every major insurer should be able to provide this coverage. If you are in the market for a commercial automotive plan, however, Progressive offers a wide range of commercial auto endorsements for customizing an automotive policy.
Bike deliveries and deliveries on food may be covered by your workers’ compensation policy. Before deciding on a delivery strategy, restaurant should check with their insurers to get a clear idea of additional policies and costs.
Pros & Cons: In-House Online Ordering & Delivery System
End to End Control: An in-house solution allows you to control every aspect of your online ordering and delivery process from the menu selection, pricing, and delivery area.
Additional Insurance Costs: Adding an in-house team of drivers requires additional insurance to cover the delivery vehicles whether you use company cars or drivers’ personal vehicles.
No Commission Fees: Restaurants will not pay commissions to a third-party for every online order that comes in.
Additional Labor Costs: Hiring your own team of drivers will definitely add to your training and labor costs.
Customer Retention: Customer information from orders placed through your website can be logged and retained to improve customer service or tailor loyalty programs or future marketing campaigns.
No Built-In Marketing: An in-house solution does not have any organic ways to grow your customer base.
Social Media Integration: Most in-house solutions enable restaurants to share their menus directly on social media channels, placing the tool directly in front of the people most likely to use it.
Third-Party Online Ordering & Delivery Platforms
Third-party delivery platforms like DoorDash, Uber Eats, and GrubHub are popular options for restaurants that want to expand into online ordering and delivery quickly. They are popular with restaurants because they are popular with customers. The most significant advantage of working with these platforms is the ability to promote your restaurant to a new audience.
Restaurants that want to promote themselves to different customers can work with more than one third-party platform. While they all operate with annual contracts, these contracts are non-exclusive.
How Third-Party Delivery Platforms Work
The first thing to note about third-party delivery platforms is that, at their core, they are not delivery companies. They consider themselves logistical platforms. Their business is communicating customer orders to restaurants and connecting restaurants with independent drivers to deliver those orders. The platforms do not employ drivers; the drivers are simply one group of people that the platform connects.
Common Third-Party Delivery Fees
20% - 30% Commission
$300 - $500 Initial Setup Fee
20% Marketing commission
21% - 30%
10% Delivery Commission
3.05% + $0.30 Per CC transaction
15%- 30% Commission
0.80% Direct deposit fee
20% - 30%
$350 Activation Fee
Fees quoted here are based on estimates from providers’ websites, restaurant partner sources, and media sources. Individual rates will vary based on location, sales volume, and types of services provided.
Each of these third-party platforms has an in-app marketplace that features restaurants. Customers log in to the platform’s app to place an order. The order is then sent to the restaurant via a branded tablet provided to the restaurant. In most restaurants, these orders are then manually rung into their POS system to transfer the order from the tablet to the real-time order queue in the kitchen.
Some platforms, however, integrate directly with POS to send online orders directly to your POS and kitchen. Doordash, for example, integrates directly with Square for Restaurants. Restaurants that are processing a lot of online orders from multiple platforms can add a middleman app like Chowly or ItsaCheckmate. For a monthly fee, these apps aggregate orders from several sources and send them directly to your POS. Pricing for these middleman apps ranges from $69 to $79 per month.
Orders come to member restaurants pre-paid through the platforms’ credit card payment processors. Payment processing fees vary from platform to platform and are usually in the range of 3.05% plus $0.30 per transaction. Credit card payments that run through the payment platforms are paid out to restaurants once a week, minus the platforms’ commission fees.
Keeping track of the sales you make through the platforms will be essential to ensure that your deposits are accurate from week to week. It is also important because your restaurant is on the hook to pay the necessary sales tax on those orders.
Setting up Accounts
It is straightforward to set up a restaurant merchant account with any of the popular third-party platforms. The full set-up process can take three to five business days depending on the platform. Simply go to their website and find the restaurant merchant dialog, and click on the get started button. Most platforms will request your restaurant’s basic business information like name, address, phone number, and hours of operation.
To receive online payments, you will also need to provide information to link your business bank account to your merchant profile. Most of the platforms do not charge any additional fees for this, but Postmates, for example, charges a 0.08% “direct deposit fee” for transferring funds to your bank account. Take care to read the terms and conditions of any third party platform to be sure what fees they charge.
Menu Set Up
When you initially set up your restaurant account on third party platforms you must send in your menu to be uploaded by the platform’s team. Once it is uploaded, however, you can make updates to it yourself via the platforms’ restaurant manager portal. If you are receiving orders from the apps via the tablets they provide, then you will need to update the menu in the app whenever your menu changes. If you, however, the platform integrates with your POS, menu updates can be made directly in the POS.
Restaurants that process a high volume of online orders from third-party platforms will likely find that integrating with their POS saves them a lot of headaches. If, for example, you run out of a dish in the middle of a busy dinner rush, you won’t need to update the menu in two places; simply marking that dish as unavailable in the POS will make the dish unavailable for online orders as well.
Third-party delivery platforms provide member restaurants with digital tablets that sync with the platform. All of the orders from that platform will appear on their tablet, with an alert. Unless the platform integrates with your POS, these orders will not automatically print in your kitchen. To send order tickets to the kitchen, someone on your staff will need to ring the order into your POS system manually.
If you have opted to work with more than one-third party platform, you will have a tablet or smartphone dedicated to each one. When you experience a high volume of online orders, you may need to assign a server or host to handle transferring all of the orders, so you don’t fall behind. Some platforms will charge restaurants penalties if orders are not prepared promptly.
Ensuring Quality & Customer Service
It is important to remember that all the third-party platforms are just a way to promote your restaurant to a new group of customers. The product is still yours. So when customers are disappointed, or something goes wrong, your restaurant will be the place that receives complaint phone calls and online reviews. The best defense against negative customer experiences is making sure that your orders are accurate and correctly packaged before they leave the restaurant.
Since the drivers, however, are not directly employed by your restaurant or by the platform, you have little control over the last leg of the journey. Many of the platforms allow restaurants to rate drivers, so if something goes wrong, you can note it. Many restaurants do get frustrated with the lack of accountability for drivers.
Pros & Cons: Partnering with Third-Party Delivery Platforms
Marketing Potential: These platforms are excellent at driving online orders to your restaurant.
High (& Fluctuating) Commission Fees: The platforms take 15% to 30% of each sale and they reserve the right to change fees at any time.
Quick Setup: The platforms make it easy to create an account on their website.
Lack of Quality Control: Once the food has left your restaurant, you have no control over how or when it is delivered.
No Additional Insurance: A third-party platform handles background checks and insurance concerns for their drivers.
Split Customer Loyalty: Customers on the third-party platforms are retained by those platforms. Your restaurant will not be able to obtain any of that customer information.
No Additional Insurance: A third-party platform handles background checks and insurance concerns for their drivers.
Direct Competition: Your restaurant will be featured on the platforms alongside your direct competitors. Competition for orders can be fierce.
Online Ordering: Additional Considerations
Now that you have the big pieces of your online ordering system set, it is time to do the detail work. You want to think about what dishes on your menu travel well for online ordering and pickup. If your restaurant receives a lot of online orders, you’ll want to make it easy for customers or delivery drivers to identify their orders and pick them up quickly. The final detail to consider is how, exactly, you will pack each dish so that it stays hot and doesn’t spill on customers or their vehicles.
Optimize Your Menu for Online Ordering
The timing of online orders can be tricky. You want customers to enjoy your food at its best, but traffic and other uncontrollable circumstances can lead to long hold times. Edit your menu offerings in your online menu to feature dishes that are hearty and travel well. Delicate dishes or dishes like steaks or sushi that are sensitive to temperature changes or long hold times might only be available on your in-house menu.
Optimize Your Restaurant Space for Order Pick Up
You want to make it easy for customers and drivers to identify their order and pick it up when it is ready. A bookshelf placed near the entrance works well; you can place completed pre-paid orders in clearly marked bags for quick pickup. If you receive a high volume of orders, you can also find shelving solutions with heating components and digital displays. Brightloom launched the Spotlight customizable smart shelf in early 2019. This shelving system is sold in individual tiles and can be customized to fit a restaurant of any size.
Optimize your To-Go Containers
Nowadays, the sky’s the limit with to-go containers. You can find options in every size, shape, and material imaginable. You will likely need containers in several different sizes to accommodate various dishes on your menu, as well as sauces and condiments. You can find a large variety of to-go containers at competitive prices from mainline suppliers like Sysco and US Foods.
In recent years, there has been a consumer push for more sustainable food packaging options. Some cities have even taken an interest and have placed bans on plastic bags and straws. Beyond regulatory and customer concerns, sustainable and compostable packaging options are an excellent fit for any local, health-conscious restaurant concept. The recyclable and compostable boxes fit the brand. Goodstart packaging offers a vast array of sustainably produced, biodegradable fiberboard containers via its website.
Don’t forget to add these items to your food cost calculations. Dishes with several garnishes and condiments, or dishes like soups that are prone to spilling require careful packaging. Sometimes these dishes even need several containers for one meal. Decide how each dish will be best packaged, tally the cost of the boxes, bag, napkins, and utensils. Then add this cost to the price of the meal.
Alternatively, a sustainable New York City chain Dig is testing a Canteen program that allows customers to enroll in a reusable container program. They pack takeout items in lidded metal bowls that the customer returns to the restaurant on a future trip.
Charging Delivery Fees
A popular move by large chain restaurants like McDonald’s, Arby’s, and Bucca di Beppo is to offer free delivery to its customers. During the COVID-19 outbreak, waiving delivery fees has become even more widespread. After social restrictions are lifted, customers may be accustomed to getting delivery for free from their favorite restaurants. The catch, however, is that customers also like supporting local restaurants.
If your restaurant needs to charge a delivery fee to operate profitably, you will have an added challenge of educating your customers about why these fees are necessary. Whatever fee you charge should be easy to explain. For example, some restaurants charge a boxing fee to cover the cost of the to-go containers. This is usually a flat fee of $2.00 to $5.00 or a small percentage (2% to 10%) of the total order. Customers generally understand that these items cost more for the restaurant to provide.
Restaurants that charge a fee like this, however, should take extra care that the orders are well packed. They should also prepare for customers to ask if you will waive the fee if they provide containers. While that last request has implications for sanitation, some restaurants do allow a form of this.
Online ordering can be a simple or involved system that makes it easy for customers to order your food for pick up. Many restaurants add only online ordering functions for pickup in the restaurant or curbside. Adding delivery options, however, is the next natural step to expand a restaurant’s operations. An in-house solution is best for restaurants that have a well-established customer base. Third-party platforms allow restaurants to expand their customer base.
If you are considering adding delivery with your own in-house drivers, you will want to be sure to update your insurance coverage to include delivery vehicles. It is easy to add hired and unowned coverage via most major insurers. Progressive, in particular, offers a wide array of solutions for covering commercial vehicles.