Back in December 2016, I wrote this post, where I told you that I was starting a food delivery company. My company started operations mid January 2017. In February 2017 I had a seizure and found out I had stage 4 brain cancer. March 2, 2017 (my birthday), I had brain surgery to remove the tumor. I ran the company until the end of July. Getting diagnosed with such a serious form of cancer shocked me. It changed my life forever. In the words of Dostoevsky:
…causing as it were, a crisis and upheaval in his soul, which shook his mind but also ultimately strengthened it for the whole of his life, and towards a definite purpose.
Let’s get to it.
Now for you lazy folks, consider yourselves lucky I didn’t make you read the whole article!
TLDR; go to this website http://www.deliverlogic.com/ Here you will get the food delivery app and your customizable website. Feel free to comment, share, or email me your thanks 🙂 And be prepared to spend roughly $1,500-$3,000 starting this up. ***For my theory on how Indians could dominate the market, you have to read on***
My company consisted of the following:
An customer facing app – downloadable from both Google and IOS app stores, where clients go to select the restaurant they want to order from and the individual items they want to buy from the restaurant.
A driver facing app – delivery drivers view their current orders and addresses of clients. When driver clicks on the client’s address, the app opens up Google Maps showing the directions to the client’s home.
A cool website offering the ability to order directly from your web-browser.
FB page 5,000+ subscribers within 3 months.
Over 5,000+ email addresses collected
Obviously an awesome logo to boot.
With this simple setup, I earned nearly $50,000 in 3 months. Of course, you got to take the cost of food out as well as the driver(s) pay. Whatever you earn is based on the strategy you use. I’ll outline a few and you may have a few ideas as well.
And with that being said, someone with the means and a naughty streak (starting a food delivery as a side hustle) or living or having family that speaks English living in India, I believe you could gain a deep market share rather quickly. More on this later.
First, let’s define what a food delivery company is. A food delivery company is a service which people use to order food from a restaurant which is then delivered to the person’s home. Simple enough eh? It is and let me be clear – you need to have your head checked if you are approached by someone “offering” to sell you or cut you in on a food delivery franchise or any other some such crap. Why?
There’s a saying I have – YOU SHOULD buy or spend money on franchising a McDonald’s or Taco Bell, but NEVER on anything else. Especially not a damn delivery service. Two reasons: first, because anything else, especially a delivery service, will be an elaborate, idiot scam, scamming you out of money for “marketing” strategy, while you make the people franchising it rich. Or put another way, don’t spend money on franchising a business that is EASILY REPLICABLE and when you can own 100% of the profits rather than just a percentage of the profits.
The people trying to franchise it are relying on the law of large numbers to sell their “franchise” i.e. they think if they talk to enough people, they’ll eventually run across an idiot willing to spend shekels on their “franchise.” I repeat, if someone approaches you and wants to talk to you about franchising their delivery service, beware – it’s a big scam. The sales pitch will be along the lines of “uh hey Mr. So and So, I have this cool delivery business, making X amount of money, and I want to talk to you and see if we can work together. We have all the marketing down pat and we will make you a lot of money in return for a percentage of your profits.” What was just said here? But wait, let’s back up, this idiot is APPROACHING YOU (huge red flag), trying to convince you to work for him! Back to the rubric (1) is this a McDonalds or Taco Bell? No. Case closed. Peace Dr. Snake Oil.
I have no financial interest in writing this article. I’m writing it because (1) I want to and (2) hopefully it opens your eyes to the possibilities. I’m frankly tired of people not seeing the unlimited # of opportunities life presents to each and everyone of us. You want freedom? Work for yourself. But in order to do this, you need to have skills. As some gangsters like to say “you gotta have the skills to pay the bills.” Skills can be virtually anything: computer programming, reading, writing, thinking outside the box, math, good with tools and building things, ad infinitum. The point is is that if you want to be free, you’ve got to have skills. Don’t have skills? Then you know where to start.
I’ve started 6+ companies in my lifetime. Never franchised anything because there frankly is no need to. Anything not requiring extensive capital outlays or logistics is easily replicable, think Amazon. Easily.Yes, I’ve even started companies for other people but never once franchised one.
And this conversation is getting closer to what is most important to me – freedom. I hate seeing people make up excuses on why something won’t work or why something is too hard. Things in this world are not that hard. Definitely not as hard as most people make them out to be. Yes, you can double your salary by starting a side company in addition to your corporate job. Yes, you can quit your corporate job and make a million bucks. I could charge $10,000 for the information that I’m about to provide, but I’m not. I’m giving it away for free. But I’m not going to hold your hand. I am going to lay out the exact steps to take and flesh them out a bit and that’s it. I don’t control your future, you do. I can only show you what’s behind the curtain. The rest is up to you. Do you want to be free or not? If not, then stop reading and obey your boss’s next order.
We opened mid January. I found out I had brain cancer in February. And on March 2, I had brain surgery. We weren’t even open for the second half of March. Beginning in April I had radiation everyday (burning my brain with radio waves) plus chemotherapy. At this point, I could care less about making the company a huge success. I definitely could have, but now I have other plans for my life rather than building companies and working like a rat. The point, the company was already automated, running itself so to speak. Everyday I laid around and watched t.v. and slept. That’s it.
You should see by this, that this is an extremely easy company to start. EXTREMELY. In fact, people that are working in corporate America could start this from their desk at work. It’s not a full-time job and is easily automated, which means you don’t really have to do anything at all. Just sit back, relax, and watch your bank account build.
Now you’re probably asking, if it’s so easy why did you shut Yellow City down? I did so because as with any business, they all come with a certain level of stress. And I for one am trying to live a life that is virtually stress free. Why? Because the doctors say that the brain cancer I have is going to kill me. And I’m so far from being ready to die. I have three young kids that I need to be a father to, to teach them, to mold them into good people. For me, the less stress the better. And on top of all this, I’m following what my heart is telling me, and it’s telling me to write. So write is what I’m going to do.
My goal with writing this piece is to open your eyes to the possibilities of what life has to offer and to enlighten you to the scams out there trying to take your money. I don’t make money off of writing this article. No one is paying me to write it. I’m writing it simply because I want to help you help yourself. If you’re working a corporate job, fine. Start one of these and then quit. When you do, send me an email and tell me about it. I’d love to hear your story.
Enough with the blabbing, here’s how to do it.
1. Name your company but make sure it’s a valid name. Do this by checking with your local business or small business association (SBA).
2. At the same time, when you come across a name you like, you need to check it against available domain names over at Go Daddy.or some other domain registrar. If you pick “Amarillo Delivery” you’ll notice that it’s taken. This means iterate on the name until you get something that is available in (1) your city – step #1, and (2) Go Daddy.
3. Now you’ll want to file all of your business paperwork with the city. Not sure what papers you need? Ask them, they’ll tell you. I suggest opening under an LLC or better S-Corp, but you can always go the easy route and do it as a Sole Proprietorship. Choose your format and file. You’ll pay some kind of small fee such as $30 .00 for this. They’ll give you copies of your paperwork which you’ll then take to the bank to open your business account.
4. Next you’ll want a cool logo for your company. I suggest do it for yourself for free and utilize Adobe Illustrator and some free templates downloaded from within. Or search online for someone who’ll design a logo for you.
5. Go ahead and set up a Facebook Business page, Twitter, Instagram, and Snapchat. Whatever you want to go with or without is fine.
6. Now you’ll want to go visit restaurants and sign them up to receive delivery services from your company. Get restaurant’s menus, add them to your app and website through your backend. By the way, you obviously need to put every restaurant in your city on your app, permission or not. It’s better to ask forgiveness than permission. Now it’s time to explain strategy:
(A) There are two strategies here. (1) charge the restaurants a commission or a percentage on the food that you sell for them. For example, a good rule of thumb is 20% commission. That means if you sell an item for the restaurant for $10.00, the restaurant pays you $2.00 or 20%. Easy enough right? Well, yes, it is on paper. The logic is simple – you’ve made the restaurant money they otherwise wouldn’t have earned without your service. The least they can do is give you $2.00 of their free money. Unfortunately, when you tell an owner of a restaurant that they have to pay you (even though is free money they otherwise wouldn’t have earned), they back down. Logic flies out the window. Owners of restaurants don’t want to pay. Yes, they want you to make them extra money, but they don’t want to pay for that extra money. Here’s an example of the point I’m making – your delivery company makes Restaurant ABC $5,000 in one month in sales. Great! But the restaurant owner will shy away from giving you a percentage of the $5,000 that you made for them. I know for you readers that are logical and have brains, this makes no sense. I assure you though, this is the rule, not the exception. In plain english, the restaurant owner would rather forfeit making an extra $4,000 than pay you $1,000 for the delivery service that you provide. For you first time entrepreneurs, welcome to the real world.
(B) The (2) strategy is this – provide your services for free and add-in $$$’s into the restaurant’s food prices. If they sell an item for $10.00, you go and add your $2.00 fee to this. When customers are on your app, and add the item, the item price shows $12.00 rather than $10.00. Your cut here is $2.00. This strategy is good for a couple of things (1) continuing percentage cut negotiations with restaurants owners or “giving them a trial period” to see how much money you can make the owner, and/or (2) offering food from restaurants that do not want to pay. The former part is good for extending your restaurant availability options, allowing for a richer offering of food at no risk to the restaurants.
7. Now, let’s add an intricate wrinkle – Your General Store. What is a General Store? A place that sells pretty much anything that Walmart sells. You will either have to build this into your site or talk to someone that has a general store template. I suggest to copy someone’s as they are all the same. Your general store will sell things like toilet paper, bread, cereal, milk, cokes, red bull, candy and chips. Obviously you’ll charge a higher price than your local gas station charges for these. For example, the gas station sells a coke for $1.25…ok, you charge $3.00. You also have the option to overlay your General Store over every restaurant’s menu. So say someone is buying steak dinners for everyone in their family and they want drinks. Your store will pop-up on their app screen asking them if they want drinks. Like I said, I’m not going to hold your hand, so ponder this paragraph and tease is out as best you can.
8. Marketing – let’s face it, everyone has their own idea of how they should market. And I’m not here to convince you how to do it. I tend to go the goofy, sarcastic way, but that’s just who I am. You’ll mainly want to market through these channels:
Facebook business page, Facebook Ads and Facebook Live. Don’t be a pansy.
Snapchat – I used it with my company with good success. Then I got sick and quit using it. Worth a try.
Google Adwords – not going to explain this unless you wanna pay me $200 an hour.
9. IPAD – You’ll also want an IPAD. This is based on the assumption that you, the owner, will do the first deliveries. And when you’re doing the first deliveries you need to be able to (1) answer the phone, (2) place orders via IPAD, and (3) drive.
10 Business Number – at the beginning your cell-phone is fine.
11. Dispatch, drivers, and scaling. When your company grows, and it will, you’ll want to hire a dispatcher. A dispatcher is one who answers incoming calls and places orders for those who want to place their order over the phone rather than via app or website. Of course, you charge extra for this 🙂 Drivers – use high school kids or family members. Scaling – your company will probably double in size every two months or so for the first year.
12. Delivery bags – you’ll want varying sizes of food carrying bags. A simple google search will wield results.
Marketing Domination Strategies
Pricing – a food delivery company can put all others on their knees, within a month, if they are able to offer lower prices than the competitors. This isn’t anything new, but I don’t think it’s thought about enough. If your competitors are pricing their deliveries at $3.99, can you offer them at $2.99? This poses good news for (1) corporate people wanting a side hustle, or (2) Indians. Corporate people have a decent advantage here because anything that they make is gravy since they’re not dependent upon the delivery company for making a living. Indians have an even better advantage because they can virtually destroy all the margins and convert dollars to rupees, and still come out way on top. **Moral note** I believe in right and wrong and I’ve come to understand that everyone’s definition of right and wrong is different. My definition of right and wrong could be and very well may be, different than yours. This strategy will put companies out of business. Period. If you’re fine with doing that, ok, but you will be the one living with that shadow.
Excellent Service – try and automate or routinize everything from all of the steps drivers must perform, from checking all orders to ensure accuracy to what they do when they arrive at their destination. Automate this and customer retention and loyalty will be there.
Email funnels – I’m not going here. If you want me to, you’ll have to fork over my hourly fee of $200 per hour.
Where do I find drivers? Craigslist, Facebook, people you know, family members.
I think I’m through with this post. I’ll read over it and will add to it, if I see the need. Otherwise, I truly hope this article has lit you on fire.