Restaurant Plan: Does Delivery Add Profit or Displace Dinner?

Delivery should be judged against the dinner service it changes. Added order revenue can be outweighed by platform costs, packaging, extra kitchen labor and contribution lost when existing guests move to the new channel.

Compare the service with and without delivery

Original assumptions, $ per dinner service. Baseline demand is 50 dine-in covers at $30, with $12 variable cost each and $900 of service commitments. The room's assumed ceiling is 60 covers and the kitchen can handle 72 meal-equivalents. Each cover or delivery order uses one equivalent in this simplified mix.

A delivery offer adds twelve $28 orders. Each costs $12 food plus $7 channel fees and packaging. It displaces six dine-in covers and requires $80 extra kitchen labor.

The twelve deliveries add $108 contribution, exactly matching the six lost dine-in covers at $18 each. Extra labor then makes the change negative $80, even as sales rise $156. Total kitchen load is only 56 equivalents, so spare aggregate capacity does not rescue unfavorable channel economics.

Find the substitution limit

With all other assumptions unchanged, delivery adds $28 before any dine-in displacement: 12 ×9 -80. Losing one cover leaves $10; losing two leaves negative $8. The offer can tolerate at most one whole displaced cover in this case. Measure substitution rather than treating every delivery as new demand.

Date the complete selected cash

Assume all $1,736 of food, channel, staffing and service commitments are paid before receipts. Dine-in cash of $1,320 settles on day 2, leaving negative $416; delivery cash of $336 settles on day 7, leaving negative $80. These payment dates are illustrative. Actual supplier terms and common roster dates may change the funding trough.

Use channel-specific realized baskets, recipes, settlement terms and the busiest kitchen interval. The Restaurant Financial Model connects feasible covers, average checks, costs and staffing to the broader venue plan.