2023 was a year of mixed performance for the global restaurant industry. While restaurants generally recovered from pandemic-era losses, record-breaking inflation took a bite out of many eateries’ profit margins. Now more than ever, restaurant tech is needed to help eliminate redundant costs and maximize returns on every order served. That’s what more than 275,000 businesses have been doing with Otter’s Restaurant Operating System.
Below, you’ll see many of the most vital (and most timely) data points for the success of today’s restaurants across the United States and Canada. Through the powerful features of our reporting apps, we’ve discovered key strategies to help restaurants stand out and manage their bottomline. Our suite’s Marketing tool has also determined the most effective methods of boosting customer loyalty, encouraging reorders and high reviews. With our newly-introduced software, you’ll also see the impact of modern QR codes for dine-in and commission-free online ordering on revenue.
Read on to see some key takeaways and download the full report below for more tips on how to set your restaurant up for greater success in 2024.
1. Top-ranked delivery cuisines of 2023
Eaters know what they like when it comes to ordering from third party food delivery services. Not only have the top ten cuisine types remained the same year-over-year across the U.S. and Canada, but the number of locations with these cuisine offerings keeps growing, as well. The cuisines with the highest year-over-year growth were coffee (29.6%) and desserts (20.2%). Consider expanding your coffee and delivery offerings in the new year to capitalize on this growth!
2. Top locations and growth rate for online delivery
Across the board, the number of restaurant locations went up by 20% from 2022 to 2023. This is great news in parallel with the return to the pre-pandemic restaurant workforce. Restaurants are making a slight comeback even amidst the challenges of inflation and staffing shortages.
California has 87,000 storefront locations, making it the state with the highest number of locations, followed by Texas (78K) and Florida (57K). Wyoming has 1,400 storefronts, the lowest number of locations. On average, a state has 16,000 restaurant storefronts. If you’re in one of these more populated states, it’s even more critical to find ways to stay ahead of the competition and grow your customer base. Virtual brands or delivery app promotions are a great way to do exactly that.
3. How to convert your customers into loyal guests
Looking to get more orders? When it comes to loyal customers, 4 is the magic number! A customer needs to place 4 lifetime orders, after which they have more than a 50% chance of reordering within 30 days. Even more—after a customer orders 12 times, they then have a 75% chance of reordering within 30 days!
Having a social media presence and posting consistently is a great way to ensure you’re staying top-of-mind with existing customers and reaching new ones. Plus, you can put your online ordering link directly in your bio to generate more commission-free sales. If you're looking to give your customers more ways to order, consider starting your own direct ordering platform or exploring completely new channels like frozen food delivery.
4. The benefits of virtual brands
Adding your first virtual brand to your business can increase your orders by 24.1%. Sounds like a no-brainer, right? You can use your existing resources and space to expand what you’re already doing with the goal of driving more sales.
Here’s how easy it is to get started:
- Work with the Otter team to get matched with a brand that fits your business and inventory
- Easily manage, fulfill, and track your new brand in one easy platform
- Increase your reach on delivery apps with your new brand
- Improve visibility on delivery apps with Otter’s automated promotions
- Keep your cancellation rate and downtime below 5% and your Uber Eats rating above 4.4
- Start fulfilling more orders with your existing resources to grow your bottom line!
5. How to keep your cancellation rates down
Reducing cancellations is critical to your restaurant’s success and directly correlates with your restaurant rankings. The average order cancellation rate for restaurants in 2023 is between 1.5-3%. This means that, in dollars, a restaurant that collects $10k in weekly revenue loses between $150 and $300 per week due to canceled orders. To help prevent canceled orders, make sure your online menus are up to date, and keep business hours on your website and apps accurate, as well.
You don’t have to wait until the new year to upgrade your business and enhance your restaurant tech stack, but it’s always a helpful time to start! Otter does much more than just order aggregation. With a best-in-class POS system, direct ordering channels, in-app promotions and more, Otter is the Restaurant Operating System designed to help you succeed all year round.
Book a demo with one of our Otter team members today.
Want more data? Fill out the form below to access Otter’s full 2023 Restaurant & Delivery Data Report!
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