Lucas Lopez Davalos, a bar consultant from Buenos Aires and Iain McPherson from Panda and Sons, Edinburgh talk to the Diageo Bar Academy about their experiences and top tips for takeaway service.
Lucas launched an online market Dava Mercado, selling drinks and experience boxes from some of the best restaurants in the country, while Iain introduced an online delivery service, ‘Edinburgh Booze Delivery’ and both shared their insights and guidance from putting these services into practice.
- SIMPLIFY THE OFFER
Iain: Too many options can be overwhelming, so we restrict our online offering to six cocktails per bar. From an operational point of view this helps save time as bars can then batch multiple cocktails in line with supply and demand.
Our e-commerce platform has been invaluable in shaping our offering due to the level of analytics provided. Having such detailed information at your fingertips is a massive weapon in learning your consumer wants and needs.
Lucas: One of the main characteristics of our product is that we produce it with the lowest raw material cost possible and add real value in how we prepare it.
When we started our delivery service, we decided to do a selection of aperitive cocktails and classic cocktails with a little twist, which gave us good results. Now, as we are more settled, we are thinking of creating a line of non-alcoholic cocktails and a delicious kombucha.
2. BE TIME EFFICIENT
Iain: From the outset you will need to find a balance of man hours vs revenue – and it’s important to get this right for revenue reasons. We moved our whole shop online, where customers can take all the time they need to choose their products without taking up any of our time. We can then focus our efforts on fulfilling that order.
By having all our online customers choose a set time slot for pick-up or delivery, we can produce all the orders at the one time each day and customers know exactly when to expect their order, everyone wins!
2. MAKE YOUR INGREDIENTS WORK
Iain: When we first launched our delivery service, we were selling quite a lot of cocktails that contained perishable ingredients – which meant reduced shelf life and higher costs. We have since swapped out our fresh lime or lemon with an acid blend solution, that can keep for up to 3 weeks refrigerated. Not only can we save time by preparing this in advance, we don’t incur the cost of the fresh ingredients. I would urge you to look at your menus to identify ways you can make similar substitutions – so long as they don’t impact the flavour or quality of the serve.
Lucas: The product you provide is critical to the overall success of the service and in my experience, you can’t compromise on quality just to save money – in the long run that will negatively affect you.At Dave Mercado, we are really careful about waste and make effective use of each ingredient. With the fruit waste, for example, we process them and produce different preparations such as sweets, fruit leathers and infusions. Nothing is thrown away.
4. PACKAGE IT UP
Iain: It’s easy to overlook the cost of packaging, but when not carefully considered it can easily mount up. Where possible, buy in bulk. The more you buy, the cheaper the packaging will cost overall. We also chose bottles big enough to fit two servings of each cocktail. We sell them in pairs, as the increased cash margin helps combat the reduced gross profit.
Lucas: Cost isn’t the only deciding factor, you must make a call on whether you want to be sustainable or not. This will likely come at a higher cost, but it means making a long-term compromise that the world and environment will thank you for. Sustainable packaging can also be the feature that differentiates your offering in the market, so it’s worth exploring, particularly if you are an eco-friendly environment.
5. KNOW THE LAW
Iain: It’s worth seeking expert guidance to ensure you are aware of the specific legalities in your country. In Scotland, for example, you need to have an off-licence capability on your operating plan for alcohol to be taken off premises.
Lucas: When setting up a system like this, it is incredibly important to seek professional advice and consult. Have an expert review your terms and conditions, particularly on your online store, to ensure you are totally compliant.
6. BE TECH SAVVY
Iain: Taking advice and guidance from YouTube and web development forums I was able to set-up the Edinburgh Booze Delivery website. I’m not saying you should do the same, but my point is, you can build valuable in-house capabilities by harnessing the power of technology. I saved a lot of money by building my own website but there are a number of creative ways to open an online store, like Facebook and Instagram shops, you can even set-up a WhatsApp ordering system.
Lucas: It pays to be digitally savvy in the current hospitality landscape. Whether that’s creating an online store or using social media channels to sell to, and communicate with, your audience. Don’t lose sight of the fact that people buy from people, your customers need to know that you are on the other side. Use your channels to connect with your community and build loyal customers for life.
7. DELIVER, DELIVER, DELIVER
Iain: We are fortunate in that we can deliver in-house, meaning we have full control over this otherwise uncertain aspect of the service, and we don’t have to pay a third party. Where possible I would urge you to explore the viability of this for your venue, otherwise shop around your local area, are there any local couriers you could negotiate a good rate with?
Lucas: For deliveries within an 80km radius we use our own in-house delivery service, but for sales further out, we ship by national post. We track all packages sent via post but there is always the risk that the product can be compromised or manipulated during transit. Packaging can help here – as mentioned previously, packaging should be selected carefully as it plays a crucial role in maintaining the aspect and the quality of the products inside. We also provide delivery updates and find this strengthens customer confidence and benefits the overall relationship.
8. DIVERSIFYING THE PORTFOLIO
Iain: Beyond our cocktail offering, we offer extras to compliment the purchase, including glassware. We also diversified the online portfolio to also sell mixers, snacks, branded merchandise, and gift vouchers, making our online store a sort of one-stop shop in an effort to increase spend.
Lucas: We have been getting creative and tapping into the experience sector by building custom food and drink packages. They are designed to give the customer a special night in at a time when they can’t, or choose not to, go out. Another way to increase sales is by collaborating with like-minded brands or individuals in a mutually beneficial way to reach new audiences and drive awareness of your product.
9. USEFUL RESOURCES
Iain: As takeaway and delivery services become part of our new reality there is an increasing amount of information online for support and guidance. I found it useful to look at what others were doing, on a global and local scale, and learn how they are efficiently running this new bar initiative. By speaking to other venue owners and sharing knowledge, the model for our delivery service was born.
10. TRAINING
Iain: We spend time training our staff to work across multiple touchpoints. Our staff are all multi skilled which helps us to be more agile and responsive in the current environment. It also means that we don’t need to outsource any aspects of the job which helps us reduce costs.
Lucas: Training the team on exactly how to make each serve and having set recipes, or even training the team on batching, can help minimise waste and protect margins. Not to mention, your team will feel confident in their role as they are equipped to handle their job and weather all conditions that come with it.
