In a recent exercise, Square collaborated with Wakefield Research to survey restaurateurs, retailers, and consumers across the U.S.
In the survey, over 500 restaurant owners and managers admitted more than 62% of their revenue will come from takeout or delivery in 2021.
Given the above stats, it’s safe to say most catering entrepreneurs accept the fact that online food ordering is here to stay. But how do you as a drop-off caterer succeed in this new online ordering market?
You must provide a super-efficient, convenient way for customers to order online and have their food delivered.
It’s no surprise then to see lots of caterers searching for the best platform to set up their catering business online.
If you found this resource after a bit of online research, I’m sure you came across different platforms promising to make the process seamless.
An example is ezCater ordering software.
But is ezCater worth considering to take your catering business online? To answer this question, here’s an in-depth review of how ezCater works and its downsides for drop-off caterers.
To help you determine whether it’s a right fit for your catering business.
But before we dive in, let’s take a look at how ezCater works.
- How Does ezCater Work
- How to Setup Your Catering Business on ezCater
- ezCater Ordering Software Pricing & Commissions
- Downsides of Using ezCater (compared to a commission-free alternative)
- Final Thoughts: Scale Your Business With a Commission-Free Catering Automation Software
How Does ezCater Work
ezCater is a Boston-based online catering marketplace. The platform connects caterers, restaurants, and customers.
It houses over 80,000 restaurants and caterers.
And all those businesses are competing for the attention of potential and repeat customers.
When customers visit the site to order food, they find a list of various restaurants’ and caterers’ online menus based on their requirements.
How to Setup Your Catering Business on ezCater
To set up on ezCater ordering software, you simply create an account and set up your online menu. Next, you’d add cost, delivery fees, and other restrictions you want like charging for last-minute cancellations.
Once your page is active, customers who can find your page can place orders. ezCater receives each order and sends the details to you via email, text, or fax for you to either accept or reject the order.
You have a 15-minute window to accept or reject an order before you receive automated phone calls asking for your response.
If they don’t get any response, they’ll reject the order on your behalf. Upon rejection, they’ll send it to another caterer on their platform
But if you were quick to accept the order, ezCater will remind you of it the night before or the morning of the order to ensure it’s on track.
Then you prepare the food and deliver it yourself or use one of their delivery partners.
Once the order has been completed, ezCater ordering software takes its commission first. After that, you have to wait a week to receive your share either by check or electronic transfer.
On one hand, this may seem like a great way to get customers for your catering business. On the other, you must compete with thousands of other caterers on the marketplace, not to mention sacrificing your precious margins to get these customers.
Now that you understand how ezCater works, let’s take a look at its pricing and commissions.
ezCater Ordering Software Pricing & Commissions
Pricing is something most people look out for when choosing a platform for their business. Caterers are no different.
On ezCater, creating an account and setting up your online menu is free. However, you’ll sacrifice commissions on each order you get.
ezCater commission is quite on the high side. It charges a 15% commission, plus a 2.75% processing fee for credit card payments.
That may not seem like much. But when it’s time to balance your books, you’ll realize you’ve lost a huge amount of money to middlemen.
Imagine what you could do with the extra money you lose to a third-party site like ezCater. You can expand your business, buy new equipment or get a bigger space.
But besides charging commissions, what are other downsides to using ezCater?
Downsides of Using ezCater (compared to a commission-free alternative)
1. Competition for First Page Rankings
There’s a funny saying that the best place to hide a dead body is on Google’s second page.
Because no one goes there.
Well, maybe some people do. But according to research from Moz, Google’s first-page captures 71% of search traffic clicks and in recent reports, it’s as high as 92%.
Second-page results capture as low as 4% of all website clicks.
Now here’s the point I’m trying to make. Most people never go beyond the first page of search results on most online platforms.
The same could be true on an online marketplace like ezCater.
There’s no guarantee your catering store or online menu will show on the first pages. If you’re new on ezCater, you may not even appear on the tenth or twentieth page.
Remember there are over 80,000 businesses all competing for these top spots and the same customers.
To rank higher on the marketplace largely depends on factors such as:
- A high order acceptance rate,
- Prompt responses to orders,
- Positive reviews,
- On-time delivery, and
Sounds like a lot of work, right?
So, relying on a platform that promises vastly wider audiences isn’t exactly the best business strategy for scaling your catering business.
On ezCater ordering software, you still have to promote your catering business yourself to stand a chance. If that’s the case, why not do so using a platform where you don’t have to sacrifice commissions to a third-party?
Take Charlton Becker of Charlton Becker Catering, for example.
He knew sacrificing commissions wasn’t healthy for his business. So he pulled the plug on ezCater after four years of using their platform.
After he switched to HoneyCart, and here’s what he said:
“Ultimately, we knew that ideally, we wanted people to come to our website and order directly from us…no 3rd party middle-man that would just send them emails to promote our competitors. “
2. Margin-eating Tactics
You may have a passion for running a catering business but here’s the harsh reality…
Passion won’t pay the bills.
To keep your business running, you must make a profit.
On a marketplace platform, you have to constantly give out discounts or reduce your prices just to rank higher up the listings.
Doing those alone dips into your margins.
Now add the commissions you must sacrifice for each order to this, and you may have little or nothing left to keep your business running.
But with a commission-free platform that also automates the entire online ordering process for you, you‘d worry less about reducing prices to rank higher or increasing them to boost your margins.
Instead, you can focus on marketing your catering business. And once you send potential customers directly to your online menu, you have 100% control over your ordering policies.
3. Commissions on Repeat Customers
Let’s assume potential customers find and order food from your online menu on ezCater. It makes sense for the platform to remove their commission because they brought the customers the first time, right?
Subsequently, when these returning customers go directly to your online menu on their platform to order, you would be forgiven to think you no longer need to pay commissions.
But that’s not the case with these third-party sites.
You still have to sacrifice commissions on returning customers’ orders.
However, on a commission-free platform, you don’t have to worry about sacrificing your precious margins. And that’s whether it’s new or returning customers.
Any money that comes into your business is yours to keep.
4. Losing Loyal Customers to Competitors
On a platform like ezCater where customers are spoiled for choice because there are too many options to choose from. With that, the chances of losing them to your competitors are much higher even if they are loyal.
Little wonder 58% of restaurants say they prefer to use their own app or website for delivery.
On ezCater, customers get enticed by juicier offers from one of your competitors. If it’s not the case, they suffer from poor customer service on the side of the platform, which could mar the relationship you have with them.
You can avoid all these with a commission-free platform branded to your taste. First, you’re never in direct competition with anyone at the time a customer is ordering online. And that’s because you own the platform.
Also, they’ll get a superior experience, which you can personalize according to your customers’ needs. Take this seriously because research shows that 71% of consumers get frustrated if their experience with a business isn’t personalized.
Pem Booke, Marketing Manager of SuperStaff reiterates this in his article in Modern Restaurant Management:
“Customer loyalty is built through positive engagements. You may have excellent marketing strategies and competitively priced products, but you should always keep in mind that service is just as impactful as the two.”
I’ve listed four downsides of using ezCater to run your catering business online compared to a commission-free platform like HoneyCart.
One significant benefit is not having to sacrifice your precious profits to these third-party sites. Another is that you can automate the entire online ordering process.
Now, you may be wondering, do caterers mind?
Of course, they do.
And don’t take my word for it.
Here’s the experience Linda Estrada of MyTacoGuy had with ezCater. Even though she was getting 30 orders monthly from them, she was still paying commissions on new and repeat orders.
In her words:
“We were using ezCater on our website and received 30 orders a month from them. 90% of our business was repeat orders and half of them still went through ezCater. Outside of ezCater, we were spending too much time going back and forth via email for every order. Customers always had to wait for me to email or text them back…”
And she wasn’t comfortable with it:
“On top of feeling overwhelmed from wearing too many hats in the business, it killed me knowing we had to share our profits with ezCater even though it was OUR FOOD customers loved, and all they did was process the order.”
Linda switched to HoneyCart, and here’s what she had to say:
“I love how I can make instant changes and updates to my menus without having to email someone to do it and waiting for days. I’m 100% in charge of my menu, my prices, and order volume.
The best part for her?
But the BEST part is… now we get to keep all the profits from our return business!”‘
Final Thoughts: Scale Your Business With a Commission-Free Catering Automation Software
It’s no secret that third-party sites like ezCater entice unsuspecting caterers with the promise of a wider audience.
It’s one of the reasons many caterers jump at the offer at first. After all, they pay nothing to set up their online catering menu and assume no responsibility for building or managing an online ordering platform.
The site does all the hard work, while they sit back and wait for new orders to come in.
Sounds easy, right?
Think of all the amount of money you’ll lose over a long time all in the name of commissions, and it’s easy to see why setting up your catering business on their site isn’t such a great idea.
The worst part?
You must play by their rules and still face tough competition from thousands of other caterers and bigger restaurants.
This makes using a commission-free catering order automation system like HoneyCart a no-brainer. The software is designed from the ground up for caterers who want 100% control over their ordering policies.
Once it’s up and running, you only need to focus on getting new customers and providing an excellent customer experience to your existing customers.
Many caterers now recognize the need to have control and flexibility over their catering system even if it means missing out on third-party referrals.
It’s why Charlton Becker switched to HoneyCart.
In his words:
When I first discovered HoneyCart, my main concern was missing out on 3rd party referrals. But I knew we had to give corporate clients convenient online ordering because many of them just don’t have the time to email back-and-forth…
So, ready to take control of your catering business?
Start your free trial right away. No credit card is required.