Tiny carried the Rib Dinner for Two out of the Western Avenue steakhouse and put it on the front seat of his cab, and turned the meter on.
He hadn’t yet turned on the ignition, but the aroma of smoky pork and barbecue sauce was already driving him nuts.
“That smells good,” Tiny said out loud.
After a few blocks, he sneaked a peek at the ribs.
“That looks good,” he said admiringly.
A minute later, he said, “Tastes good, too.”
He left a five-mile trail of bones from West Rogers Park to north Evanston. The Rib Dinner for Two on the front seat now looked like a Rib Dinner for One Guy On a Diet.
He wiped his mouth, shrugged at the barbecue sauce on his shirt, and brought the box to the house. He thanked the lady at the door for his fare and tip, and got back in the car.
Tiny was never allowed to transport food again. Amazingly, as a result of this incident of 30 years ago, the cab company did not lose the restaurant’s business, however. It remained in force until phone orders built up a little, and at that point, the restaurant hired somebody’s kid to start an in-house delivery service.
That is not the way the food delivery business usually works today. Now, restaurants often pay delivery companies a percentage of each sale to deliver.
That way, the restaurants don’t have to arrange their own services. One less headache. And the deliveries get done fast. No waiting for orders to multiply so an in-house driver won’t waste time hitting the road with just one order.
That speed doesn’t come cheap. The services charge enough, often around 15 percent, so that if each delivery order rides alone, it might still pay off for the delivery company and the driver.
So a restaurant winds up turning over much of its profit margin to a delivery contractor. Restaurants wind up raising prices to make up for it, or shaving quantity or quality, or become resigned to losing money on some deliveries.
Customers may think that all this extra business is great for their favorite restaurants. It ain’t necessarily so. It’s reminiscent of the old joke about the owner who loses 50 cents on every sale, but isn’t worried. “I make it up on volume,” he explains.
The restaurant owners know that some customers hear about them through the delivery services, so they think it’s worth it partly because of that.
But the delivery services have figured that out, too. They’re planning their own restaurants where people can’t necessarily go in. They’ll cook their own food to load into their little trucks.
They need to, because despite all the money they’re charging, they’re reportedly still having a hard time retiring their debt.
It reminds me of the tamale guys who show up in taverns that don’t have kitchens. People drunk and famished, or trying to stave off tomorrow’s hangovers, will eat clammy lukewarm tamales from a guy who looks like he slept in his car. It’s all about the delivery, not the product.
At about the same time that Tiny was banned from delivering meals, an ex-cabdriver named Reza Toulabi was driving an oven-equipped car packed with Persian food to taverns frequented by guys who missed the cuisine from back home. As it turned out, the stuff was really good. You didn’t have to be from Iran to like it. And he started to include American food, too.
Before long, the very popular Reza’s Restaurant opened. The last time I checked, the Toulabi family owned three restaurants and two brands in and around Chicago.
From what I can see, you can grow a restaurant business into a delivered-food business. And you can grow a delivered-food business into a restaurant business. But despite what a lot of people think, it works better if you do it all yourself.
Pizza joints proved many years ago that it’s quite possible to run your own efficient delivery service. You don’t see many of them hiring contractors.
The City of New York has noticed that restaurateurs there feel compelled to offer delivery to stay competitive, but the delivery services are charging so much that it looks likely to cause mass die-offs among the representatives of one of the greatest collections of restaurants in the world. So they’re trying to pass an ordinance to limit the charge to 10 percent or so.
But it’s difficult to protect people from themselves. Though many restaurants have enough trade to hire their own delivery guys, many of them never will, because it’s much easier to use contractors.
The restaurant business has entered a cycle in which outside contractors digitally perform many management functions. Delivery is just another outsourced thing.
The result, eventually, will be that the restaurants will make deals with the contractors so nobody loses money, except, of course, the drivers. It won’t be surprising if the costs are spread to all the customers, including the ones only asking for their meals to be delivered from the kitchen to the table where they’re sitting.